04-001041 In Re: Petition For Rule Creation - Coastal Lake Community Development District vs. * Status: Closed Recommended Order on Wednesday, June 30, 2004.

Summary: The local public hearing was held on the petition to establish a community development district. The evidence recieved supports the petition.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

IN RE: PETITION FOR RULE )

CREATION - COASTAL LAKE ) Case No. 04 - 1041

COMMUNITY DEVELOPMENT DISTRICT. )

__________________ )

ADMINISTRATIVE LAW J UDGE’S REPORT TO THE

FLORIDA LAND AND WATER ADJUDICAT ORY COMMISSION

Notice was given and a local public hearing under Section

190.005(1)(d), Florida Statutes, was held on May 25, 2004,

before Charles A. Stampelos, an Administrative Law Judge of the

Division of Administrative Hearings (DO AH). The hearing was

held at the WaterColor Inn, 34 Goldenrod Circle, Seagrove Beach,

Florida.

STATEMENT OF THE ISS UE

The issue is whether the Petition to Establish the Coastal

Lake Community Development District should be granted pursuant

to Chapter 190, Florida Statutes, and Florida Administrative

Code Chapter 42 - 1. The local public hearing was conducted for

the purpose of gathering information in anticipation of

rulemaking by the Florida Land and Water Adjudicatory Commission

(Commission).

APPEARA NCES

For Petitioner: Jonathan T. Johnson, Esquire

Brian A. Crumbaker, Esquire

Hopping, Green & Sams, P.A.

123 South Calhoun Street

Post Office Box 6526

Tallahassee, Florida 32314

PRELIMINARY STATEMEN T

The Petitioner filed the Petition to Establish the Coastal

Lake Community Development District (Petition) with the

Secretary of the Commission on February 27, 2004. Prior to this

time, Peti tioner delivered the Petition and its attachments,

along with the requisite filing fee, to Walton County. A copy

of the Petition, including its attachments, was received into

evidence as Petitioner’s Composite Exhibit A.

On March 19, 2004, the Secretary of the Commission

certified that the Petition contained all required elements and

forwarded it to the DOAH for the purpose of holding the public

hearing required under Section 190.005(1)(d), Florida Statutes.

A copy of the Secretary’s correspondence to th e DOAH was

received into evidence as Petitioner’s Exhibit D. ( All

citations are to the 2003 version of the Florida Statutes unless

otherwise indicated.)

The Commission published a Notice of Receipt of Petition in

Volume 30, Number 19 of the Florida Admin istrative Weekly on

May 7, 2004. A copy of the Notice of Receipt of Petition was

received into evidence as Petitioner’s Exhibit G.

The local public hearing was scheduled in Seagrove Beach,

Florida, on May 25, 2004, at 10:30 a.m. (CST). Petitioner

publish ed notice of the hearing in accordance with Section

190.005(1)(d), Florida Statutes. The proof of publication of

the notice of local public hearing was received into evidence as

Petitioner's Exhibit C.

The land to be included within the proposed District is

contained wholly within the boundaries of unincorporated Walton

County, Florida. The land within the external boundaries of the

proposed District is neither contained within nor contiguous to

the boundaries of any municipality. Section 190.005(1)(c),

Florida Statutes, provides that the county containing all or a

portion of the lands within the proposed District has the option

to hold a public hearing within forty - five (45) days of the

filing of the petition. Walton County did not opt to hold such

a he aring.

At the local public hearing on May 25, 2004, the Petitioner

presented the testimony of George Jones, Project Manager for The

St. Joe Company; Richard Wohlfarth, P.E., of CCL Consultants,

Inc., an expert in civil engineering and public infrastructur e;

William J. Rizzetta, President of Rizzetta & Company, Inc., a

management consulting firm, an expert in district management;

Carey Garland, Director of Public Finance with Fishkind &

Associates, Inc., and an expert in economic and financial

analysis; and Mike Patterson, Principal Planner with PBS&J,

Inc., an expert in land use planning. Petitioner's Exhibits A

through N, were received into evidence at the hearing.

A copy of the Transcript of the public hearing was filed at

DOAH on June 24, 2004. On Ju ne 24, 2004, Petitioner filed a

Proposed Report of Findings and Conclusions, which has been

considered.

SUMMARY OF THE REPOR T

A. Overview

1. Petitioner is seeking the adoption of a rule by the

Commission to establish a community development district

propo sed to consist of approximately 1,402 acres located within

the unincorporated boundaries of Walton County, Florida. The

proposed name for the proposed District is the Coastal Lake

Community Development District.

2. There are no parcels within the extern al boundaries of

the proposed District that are to be excluded from the District.

3. The estimated cost of the infrastructure facilities and

services that are presently expected to be provided to the lands

within the District was included in the Petition.

4. The sole purpose of this proceeding is to consider the

establishment of the District as proposed by the Petitioner.

Information relating to the managing and financing of the

service - delivery function of the proposed District was

considered. This re port summarizes the relevant and material

evidence relating to Section 190.005(e)1. - 6., Florida Statutes.

B. Whether all statements contained within the Petition have

been found to be true and correct.

5. Petitioner's Composite Exhibit A consists of th e

Petition and its attachments filed with the Commission.

Mr. Jones testified that he had reviewed the contents of the

Petition and approved its findings. Mr. Jones also generally

described certain of the attachments to the Petition. Mr. Jones

testified that the Petition and its attachments were true and

correct to the best of his knowledge.

6. Mr. Wohlfarth testified that he had assisted in the

preparation of portions of the Petition and its attachments.

Mr. Wohlfarth also generally described the ser vices and

facilities that the proposed District is expected to provide.

Mr. Wohlfarth testified that the construction cost estimates

identified in Attachment 7 to the Petition were true and correct

to the best of his knowledge.

7. Mr. Garland testified that he had prepared Exhibit 8 to

the Petition, the Statement of Estimated Regulatory Costs

(SERC). Mr. Garland also testified that the SERC submitted as

Attachment 8 to Petitioner's Composite Exhibit A was true and

correct to the best of his knowledge.

8. The Petition included written consent to establish the

District from the owner of one hundred percent (100%) of the

real property located within the lands to be included in the

proposed District. Mr. Jones also testified that the ownership

of the land s to be included within the proposed District had not

changed.

9. The evidence indicates that the Petition and its

exhibits are true and correct.

C. Whether the establishment of the District is inconsistent

with any applicable element or portion of the S tate

Comprehensive Plan or of the effective local government

comprehensive plan.

10. Mr. Patterson reviewed the proposed District in light

of the requirements of the State Comprehensive Plan, Chapter

187, Florida Statutes. Mr. Patterson also reviewed t he proposed

District in light of the requirements of the Walton County

Comprehensive Plan.

11. The State Comprehensive Plan “provides long - range

policy guidance for the orderly social, economic and physical

growth of the State” by way of twenty - five subje cts, and

numerous goals and policies. From a planning perspective, two

subjects of the State Comprehensive Plan apply directly to the

establishment of the proposed District, as do the policies

supporting those subjects.

12. Subject 15, Land Use, recogni zes the importance of

locating development in areas with the fiscal ability and

service capacity to accommodate growth. The evidence indicates

that the proposed District will have the fiscal ability to

provide services and facilities and help provide infr astructure

in a fiscally responsible manner in an area that can accommodate

development within Walton County.

13. Subject 25, Plan Implementation, provides that

systematic planning shall be integrated into all levels of

government, with emphasis on inter governmental coordination.

The evidence indicates that the proposed District is consistent

with this element of the State Comprehensive Plan because the

proposed District will systematically plan for the construction,

operation and maintenance of the publ ic improvements and the

community facilities authorized under Chapter 190, Florida

Statutes, subject to and not inconsistent with the local

government comprehensive plan and land development regulations.

Additionally, the District meetings are publicly ad vertised and

are open to the public so that all District property owners and

residents can be involved in planning for improvements.

Finally, Section 189.415, Florida Statutes, requires the

District to file and update public facilities reports with the

Co unty or City, which they may rely upon in any revisions to the

local comprehensive plan.

14. Mr. Garland reviewed the proposed District in light of

the requirements of the State Comprehensive Plan, Chapter 187,

Florida Statutes. From a financial perspec tive, two subjects of

the State Comprehensive Plan apply directly to the establishment

of the proposed District, as do the policies supporting those

subjects.

15. Subject 17, Public Facilities, provides that the state

shall protect substantial investment s in public facilities and

plan for and finance new facilities to serve residents in a

timely, orderly and efficient manner. The evidence indicates

that the proposed District will be consistent with this element

because the District will plan and finance the infrastructure

systems and facilities needed for the development of lands

within the District; be a stable, perpetual unit of local

government and will be able to maintain the infrastructure

servicing the lands within the District; and allow growth wit hin

the District to pay for itself at no cost to Walton County.

16. Subject 20, Governmental Efficiency, provides that

governments shall economically and efficiently provide the

amount and quality of services required by the public. The

evidence indicat es that the proposed District will be consistent

with this element because the proposed District will

economically and efficiently finance and deliver those public

services and facilities as needed by the District's residents

and property owners. The evid ence indicates that the proposed

District will be professionally managed, financed, and governed

by those whose property directly receives the benefits of the

services and the facilities provided. Creating a District does

not burden the general taxpayer w ith the costs for the services

or facilities inside the proposed District.

17. Based on the testimony and exhibits in the record, the

evidence indicates that the proposed District will not be

inconsistent with any applicable element or portion of the Sta te

Comprehensive Plan.

18. Based on the evidence in the record, the evidence

indicates that the proposed District will not be inconsistent

with any applicable element or portion of the Walton County

Comprehensive Plan.

19. The Florida Department of Comm unity Affairs (DCA)

reviewed the Petition for compliance with its various programs

and responsibilities. After conducting a review of the

petition, DCA had no comment on the petition for the

establishment of the proposed Coastal Lake Community Development

District relative to DCA’s programs and responsibilities under

Chapters 163 and 380, Florida Statutes.

D. Whether the area of land within the proposed district is of

sufficient size, is sufficiently compact, and is sufficiently

contiguous to be developa ble as one functional interrelated

community.

20. All of the land in the proposed District is part of a

Planned Unit Development (PUD) approved by ordinance of Walton

County, Florida.

21. The proposed District will include approximately 1,402

acres, lo cated within the unincorporated borders of Walton

County, Florida. From planning, engineering and management

perspectives; the evidence indicates that the area of land to be

included in the proposed District is of sufficient size, is

sufficiently compact, and is sufficiently contiguous to be

developed as a single functionally interrelated community.

E. Whether the proposed District is the best alternative

available for delivering community development services and

facilities to the area that will be serv ed by the proposed

District.

22. It is presently intended that the District will

construct or provide certain infrastructure improvements as

outlined in the Petition.

23. Installation and maintenance of infrastructure systems

and services by the propose d District are expected to be paid

through the imposition of special assessments. Use of such

assessments will ensure that the real property benefiting from

District services is the same property that pays for them.

24. Two alternatives to the use of th e District were

identified. First, Walton County might provide facilities and

services from its general fund. Second, facilities and services

might be provided by some private means, with maintenance

delegated to a property owners' association (POA) or a

homeowners' association.

25. The evidence indicates that the District is preferable

to these alternatives.

26. The District will construct certain infrastructure and

community facilities that will be needed by the property owners

and residents of the p roject. Expenses for the operations and

maintenance of the facilities the District retains are expected

to be paid through maintenance assessments to ensure that the

property receiving the benefit of the district services is the

same property paying for t hose services.

27. The community development district allows for the

independent financing, administration, operations and

maintenance of the land within such a district. The community

development district allows district residents to ultimately

complet ely control the district.

28. From an engineering perspective, the evidence

indicates that the proposed District is the best alternative to

provide the proposed community development services and

facilities to the land included in the proposed District be cause

it is a long - term, stable, perpetual entity capable of

maintaining the facilities over their expected life.

29. From planning, economic, engineering and special

district management perspectives, the evidence indicates that

the proposed District is the best alternative available for

delivering community development services and facilities to the

area that will be served by the District.

F. Whether the community development services and facilities of

the proposed District will be incompatible with the capacity and

uses of existing local and regional community development

services and facilities.

30. The evidence indicates that the services and

facilities proposed to be provided by the District are not

incompatible with uses and existing local and r egional

facilities and services. The District's facilities and services

will not duplicate any existing regional services or facilities.

None of the proposed services or facilities is presently being

provided by another entity for the lands to be include d within

the District.

31. Therefore, the evidence indicates that the community

development services and facilities of the proposed District

will not be incompatible with the capacity and uses of existing

local and regional community development services and

facilities.

G. Whether the area that will be served by the District is

amenable to separate special - district government.

32. As cited previously, from planning, economics,

engineering and special - district management perspectives; the

evidence indic ates that the area of land to be included in the

proposed District is of sufficient size, is sufficiently compact

and is sufficiently contiguous to be developed and become a

functionally interrelated community. The community to be

included in the District has need for certain basic

infrastructure systems, and the proposed District provides for

an efficient mechanism to oversee the installation of these

improvements.

33. From planning, engineering, economic and management

perspectives, the evidence indica tes that the area that will be

served by the District is amenable to separate special - district

government.

H. Other requirements imposed by statute or rule.

34. Chapter 190, Florida Statutes, and Florida

Administrative Code Chapter 42 - 1, impose specif ic requirements

regarding the petition and other information to be submitted to

the Commission.

Elements of the Petition

35. The Commission has certified that the Petition to

Establish the Coastal Lake Community Development District meets

all of the requ irements of Section 190.005(1)(a), Florida

Statutes.

Statement of Estimated Regulatory Costs

36. The SERC contains an estimate of the costs and

benefits to all persons directly affected by the proposed rule

to establish the District -- the State of Florida and its

citizens, the City and its citizens, the Petitioner, and

consumers.

37. Beyond administrative costs related to rule adoption,

the evidence indicates that the State and its citizens will only

incur minimal costs from establishing the District. T hese costs

are related to the incremental costs to various agencies of

reviewing one additional local government report. The proposed

District will require no subsidies from the State. Benefits

will include improved planning and coordination of developme nt,

which is difficult to quantify but nonetheless substantial.

38. Administrative costs incurred by Walton County related

to rule adoption will be modest. These costs are offset by the

$15,000 filing fee required to accompany the Petition to Walton

Cou nty.

39. Consumers will pay non - ad valorem, or special

assessments, for certain facilities. Locating within the

District is voluntary. Generally, the evidence indicates that

the District financing will be less expensive than maintenance

through a POA o r capital improvements financed through developer

loans. The evidence indicates that benefits to consumers in the

area within the community development district will include a

higher level of public services and amenities than might

otherwise be available , completion of District - sponsored

improvements to the area on a timely basis, and a larger share

of direct control over community development services and

facilities within the area.

40. Section 190.005(1)(a), Florida Statutes, requires the

petition to include a SERC which meets the requirements of

Section 120.541, Florida Statutes. The Petition contains a

SERC. The evidence indicates that it meets all requirements of

Section 120.541, Florida Statutes.

Other Requirements

41. The evidence indicates th at the Petitioner has

complied with the provisions of Section 190.005(1)(b)1., Florida

Statutes, in that Walton County was provided a copy of the

Petition and was paid the requisite filing fee.

42. Section 190.005(1)(d), Florida Statutes, requires the

Pe titioner to publish notice of the local public hearing in a

newspaper of general circulation in Walton County for four (4)

consecutive weeks prior to the hearing. The notice was

published in a newspaper of general paid circulation in Walton

County (The No rthwest Florida Daily News) for four consecutive

weeks, on April 27, 2004; May 4, 2004; May 11, 2004; and May 18,

2004.

Public Comment During the Hearing

43. Public comment received during the hearing raised a

number of issues, most of which were not rel evant to the

proceeding. Several comments or questions; however, though not

seemingly tied to the statutory criteria, are briefly addressed

here.

44. One speaker inquired about the source of funds

necessary to pay the debt service obligations of the Dist rict

and whether property taxes will still be paid to Walton County.

The evidence indicates that the District’s debt and

operation/maintenance expenses are paid through the levy of

special assessments on real property benefiting from the

construction of i mprovements and their maintenance. The special

assessments are in addition to any property taxes and/or

assessments levied by the local general - purpose government.

45. Another inquiry was made regarding the construction of

a dock on Lake Powell. The ev idence indicates that the dock is

not currently permitted by the ordinance establishing the PUD

for WaterSound North, and it is not anticipated that the

District will fund construction and/or maintenance of the

facility. Pursuant to Section 190.002(2)(d), Florida Statutes,

matters concerning permitting and planning are not material or

relevant when determining whether the Coastal Lake Community

Development District should be established. However, any issues

relating to the dock may be relevant to and may appropriately be

raised during the permitting process undertaken by the

applicable governmental entity.

APPLICABLE LAW

46. This proceeding is governed by Chapters 120 and 190,

Florida Statutes, and Florida Administrative Code Chapter 42 - 1.

47. The procee ding was properly noticed pursuant to

Section 190.005, Florida Statutes, by publication of an

advertisement in a newspaper of general paid circulation in

Walton County and of general interest and readership once each

week for the four consecutive weeks imm ediately prior to the

hearing.

48. The evidence indicates that the Petitioner has met the

requirements of Section 190.005, Florida Statutes, regarding the

submission of the Petition and satisfied the filing fee

requirements.

49. The Petitioner bears the burden of establishing that

the Petition meets the relevant statutory criteria set forth in

Section 190.005(1)(e)1. - 6., Florida Statutes.

50. The evidence was that all portions of the Petition and

other submittals have been completed and filed as required by

law.

51. The evidence was that all statements contained within

the Petition are true and correct.

52. The evidence was that the establishment of the

District is not inconsistent with any applicable element or

portion of the State Comprehensive Plan o r the effective Walton

County Comprehensive Plan.

53. The evidence was that the area of land within the

proposed District is of sufficient size, is sufficiently compact

and is sufficiently contiguous to be developable as one

functional interrelated commu nity.

54. The evidence was that the proposed District is the

best alternative available for delivering community development

services and facilities to the area that will be served by the

District.

55. The evidence was that the community development

serv ices and facilities of the proposed District will not be

incompatible with the capacity and uses of existing local and

regional community development services and facilities.

56. The evidence was that the area to be served by the

proposed District is amen able to separate special - district

government.

CONCLUSION

Section 190.005(1)(e), Florida Statutes, states that the

Commission shall consider the entire record of the local

hearing, the transcript of the hearing, resolutions adopted by

local general - purpose governments and the factors listed in that

subparagraph. Based upon the record evidence, the Petition

appears to meet all statutory requirements and there appears to

be no reason not to grant the Petition and establish the

proposed Coastal Lake Community Development District by rule.

For purposes of drafting such a rule, a metes and bounds

description of the proposed Coastal Lake Community Development

District can be found as Petition Attachment 2. Also, the five

persons designated to serve as the initi al members of the Board

of Supervisors of the Coastal Lake Community Development

District are identified in paragraph 5 of the Petition.

DONE AND ENTERED this 30th day of June, 2004, in

Tallahassee, Leon County, Florida.

CHARLES A. STA MPELOS

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

Div ision of Administrative Hearings

this 30th day of June, 2004.

COPIES FURNISHED :

Jonathan T. Johnson, Esquire

Hopping, Green, & Sams, P.A.

123 South Calhoun Street

Post Office Box 6526

Tallahassee, Florida 32314

Michael P. Hansen, Secretary

Florida Lan d and Water Adjudicatory Commission

The Capitol, Room 2105

Tallahassee, Florida 32399 - 0001

Barbara Leighty, Clerk

Growth Management and Strategic Planning

The Capitol, Room 1802

Tallahassee, Florida 32399 - 0001

Raquel A. Rodriguez, General Counsel

Offic e of the Governor

The Capitol, Suite 209

Tallahassee, Florida 32399 - 0001

Heidi Hughes, General Counsel

Department of Community Affairs

2555 Shumard Oak Boulevard, Suite 325

Tallahassee, Florida 32399 - 2100