04-002141 Pensacola Gulf Coastkeepers, Inc. vs. The District Board Of Trustees Of Okaloosa - Walton Community College Status: Closed Recommended Order on Monday, August 22, 2005.

Summary: Petitioners do not have standing to challenge the Respondent`s decision to certify the Foundation and endorse the sale of the Mattie Kelly property.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MARIKA HAMMET, )

)

Petitioner, )

)

vs. ) Case No. 04 - 2049

)

THE DISTRICT BOARD OF TRUSTEES )

OF OKALOOSA - WALTON COMMUNITY )

COLLEGE, )

)

Respondent. )

)

PENSACOLA GULF COASTKEEPERS, )

INC., )

)

Petitioner, )

) Case No. 04 - 2141

vs. )

)

THE DISTRICT BOARD OF TRUSTEES )

OF OKALOOSA - WALTON COMMUNITY )

COLLEGE, )

)

Respondent. )

)

RECOMMENDED ORDER OF DISMISSAL

This cause co mes on for consideration of Respondent's

Motion to Dismiss Joint First Amended Petition for

Administrative Hearing before Suzanne F. Hood, Administrative

Law Judge with the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Steven A. Med ina, Esquire

Levin, Papantonio, Thomas, Mitchell,

Echsner & Proctor, P.A.

316 South Bayen Street

Post Office Box 12308

Pensacola, Florida 32581

For Respondent: Joseph D. Lorenz, Esquire

1270 North Elgin Parkway, Suite C - 12

Shalimar, Florida 32579

STATEMENT OF THE ISSUES

The issues are as follows: (a) whether Respondent took

"agency action" when i t certified the Okaloosa - Walton College

Foundation, Inc. as its direct support organization and endorsed

the Foundation's decision to sell the Mattie Kelly property; and

(b) whether Petitioners have standing to request an

administrative hearing on those is sues.

PRELIMINARY STATEMENT

On or about March 15, 2004, Petitioner Marika Hammet

(Petitioner Hammet) filed a Petition for Administrative Hearing

with Respondent District Board of Trustees of Okaloosa - Walton

College (the Board, formerly known as District B oard of Trustees

of Okaloosa - Walton Community College.) The petition requested

an evidentiary hearing concerning whether the Board should

support, endorse, and/or not oppose the sale of the Mattie Kelly

property for private real estate development purpose s, accept

the recommendation of the Board's President pertaining thereto,

and certify the Okaloosa - Walton College Foundation, Inc. (the

Foundation, formerly known as Okaloosa - Walton Community College

Foundation, Inc.) to be operating in the best interest o f the

state.

The Board referred the petition to the Division of

Administrative Hearings (DOAH) on April 22, 2004. That same

day, the Board filed a Motion to Dismiss Petition for

Administrative Hearing, alleging that Petitioner Hammet, a minor

student, lacked standing to request an administrative hearing

and that the issues raised in the petition were moot. DOAH

assigned DOAH Case No. 04 - 2049 to Petitioner Hammet's case.

On or about May 11, 2004, Petitioner Pensacola Gulf

Coastkeepers, Inc. (Petitioner Coastkeepers) filed a Petition

for Administrative Hearing with the Board. The petition

requested the same relief as DOAH Case No. 04 - 2049. On June 15,

2004, the Board referred the petition to DOAH, which assigned

the case DOAH Case No. 04 - 2141.

On June 18, 2004, the Board filed a response to DOAH's

Initial Order. That same day, Petitioner Hammet filed a similar

response, requesting that DOAH Case No. 04 - 2049 be consolidated

with DOAH Case No. 04 - 2141.

On June 23, 2004, the undersigned issued Order o f

Consolidation for DOAH Case No. 04 - 2049 and 04 - 2141.

Hereinafter, Petitioners Hammet and Coastkeepers will be

referred to collectively as Petitioners.

A Notice of Hearing dated June 23, 2004, scheduled the

hearing for August 30 and 31, 2004.

On Ju ne 28, 2004, Respondent filed a Motion to Abate Due to

Pending Circuit Court Action. The motion was granted in an

Order dated July 1, 2004. Pursuant to the agreement of the

parties, the undersigned issued three consecutive orders

continuing this matter i n abeyance.

On June 3, 2005, the Circuit Court of the First Judicial

Circuit, in and for Okaloosa County, Florida, entered a Final

Judgment for Defendant (the Foundation) in Circuit Court Case

No. 2004 - CA - 405.

A Notice of Hearing dated June 6, 2005, scheduled the

hearing for July 8, 2005.

On June 8, 2005, Petitioners filed a Motion to Amend

Petitions for Administrative Hearing, together with the Joint

First Amended Petition for Administrative Hearing. Petitioners

also filed a Joint Response to Moti ons to Dismiss.

On June 24, 2005, the Board filed a Motion to Dismiss Joint

First Amended Petition for Administrative Hearing.

On June 28, 2005, Petitioners filed a Motion for Extension

of Time for Serving Response to Respondent's Motion to Dismiss

Jo int First Amended Petition for Administrative Hearing. The

undersigned granted the motion in an Order dated June 30, 2005.

On July 5, 2005, Petitioners filed a Response to

Respondent's Motion to Dismiss Joint First Amended Petition for

Administrative Hear ing.

On July 8, 2004, the undersigned heard oral argument on all

pending motions to dismiss.

On July 18, 2005, the undersigned issued an Amended Notice

of Hearing, scheduling a hearing on the merits for August 29,

2005, to meet the contingency that the motion to dismiss might

not be granted.

On August 1, 2005, Respondent filed a Motion to Add Expert

Witness and Exhibit. On August 3, 2005, Petitioner filed a

response to the motion. In light of the Recommendation set

forth below, the motion is moot.

F INDINGS OF FACT

1. The Foundation was incorporated and first certified as

a direct support organization in 1988.

2. The Mattie Kelly property is approximately 13 acres of

waterfront property on Choctawhatchee Bay in Destin, Okaloosa

County, Florida. I t includes the former residence of Mattie

Kelly and the real property surrounding the residence.

3. Destin, Okaloosa County, Florida, is a municipality,

bounded on the north and west by Choctawhatchee Bay, on the

south by the Gulf of Mexico, and on the east by Walton County,

Florida.

4. On August 17, 1992, Mattie Kelly executed her Last Will

and Testament (will). Article VIII of the will states as

follows:

I give, devise and bequeath my personal

residence located a 1200 Indian Trail Road,

Destin , Florida 32541, including all real

property surrounding the residence and the

sum of Five Hundred Thousand Dollars

($500,000,000) to Okaloosa - Walton Community

College for the establishment of the "Mattie

M. Kelly Cultural and Environmental

Institute of O kaloosa - Walton Community

College." The purpose of the "Mattie M.

Kelly Cultural and Environmental Institute

of Okaloosa - Walton Community College" shall

be:

(1) To provide a meeting place for

literary societies, fine arts groups, and

small performi ng groups.

(2) To provide a location for

conferences and seminars offered through

Okaloosa - Walton Community College.

(3) To provide a location for biology

studies and marine science studies

associated with Choctawhatchee Bay and the

Gulf of Mex ico.

(4) To provide a location for

displaying the coastal heritage of Northwest

Florida.

The Five Hundred Thousand Dollars

($500,000,000) endowment which forms part of

this gift shall be used only for maintenance

and operating costs in furtheran ce of the

above purposes, including the perpetual

care, maintenance and upkeep of my

mausoleum.

5. A Personal Representative's Warranty Deed dated

March 6, 1997, conveyed the property to the Foundation.

6. At some point in time, the Foundation decided t o sell

the property to a real estate developer and entered into a

contract to do so.

7. On March 15, 2004, Petitioner Hammet filed a Petition

for Administrative Hearing with the Board. The petition

questioned whether the Board should support, endorse, an d/or not

oppose the sale of the property for private real estate

development purposes, accept the college president's

recommendation about the sale, and certify the Foundation to be

operating in the best interest of the state.

8. The Board's March 16, 2 004, minutes state as follows in

relevant part:

ACTION AGENDA

DSO Certification/IRS 990

The District Board of Trustees certified

that requirements of Direct Support

Organization under FS 1004.70 have been met

and that the OWCC Foundation is in

complian ce with the procedures as herein

described and accepts Form IRS 990 as

submitted. Further, the District Board of

Trustees supports and endorses the

Foundation Board of Directors in its

endeavor to sell the Mattie Kelly Property

(Motion: Henderson; Second Rainer. Vote: 6

yes; 2 no (Smith, Wells). Motion carried.

9. On April 22, 2004, the Board referred Petitioner

Hammet's petition to DOAH, together with the Board's Motion to

Dismiss. DOAH assigned this case DOAH Case No. 04 - 2049.

10. On June 15, 2004, the Board referred the following to

DOAH: (a) Petitioner Coastkeepers' Petition for Administrative

Hearing; (b) Petitioner's Motion and Suggestion for

Disqualification of Joseph Henderson and James R. Richburg; and

(c) the Board's Motion to Dismiss Petit ion for Administrative

Hearing. DOAH assigned the case DOAH Case No. 04 - 2141.

11. On July 8, 2004, some of Ms. Kelly's relatives filed a

suit against the Foundation in Circuit Court. In Count I of the

complaint, the relatives sought a declaratory judgme nt that the

Foundation's proposed sale violates Ms. Kelly's will and that

the relatives had reversionary rights to the property. In Count

II of the complaint, the relatives sought injunctive relief to

restrain the Foundation from selling the property to a third

party in accordance with a written contract of sale.

12. On April 20, 2005, the Florida Attorney General issued

an Advisory Legal Opinion, stating that the Foundation is

subject to Florida's Sunshine Law.

13. On May 5, 2005, the Foundation vot ed to ratify the

contract to sell the property and to confirm the prior decision

to sell the property.

14. On June 3, 2005, the First Circuit Court entered a

"Final Judgment for Defendant" in L. Bernarr Kelly, Carol Kelly

and Lowell B. Kelly v. The Okal oosa - Walton Community College

Foundation, Inc. , No. 2004 - CA - 405 (Fla. 1st Cir. Ct. June 3,

2005), which states as follows in pertinent part:

6. . . . The Court is convinced by the

nature of the Will, and the testimony and

evidence that Mattie Kelly had legal advice

in her estate planning, that if Mattie Kelly

intended for the subject property to be

placed in a trust, and if she desired to put

restrictions on the subject property to

prevent Defendant Foundation from selling

it, that she knew how to a ccomplish this,

and that she chose not to do so. The Court

finds . . . that Mattie Kelly did not intend

to limit or restrict the sale of the subject

property in the future to fulfill her

desires for the creation of a cultural and

environmental institute . . . .

7. The Court finds that the deed dated

March 6, 1997, . . . does not contain a

reverter clause or language creating any

right of reversion. . . . The Court finds

that the deed conveyed a fee simple title to

the OWCC Foundation with no right of

reversion. The Court further finds that

this deed was in accordance with the intent

of Mattie Kelly at the time she executed her

will.

8. The Court finds that Article VIII

of the Will which devised the subject

property contains no language of tru st and

no language of reverter, and did not create

a charitable trust . . . .

9. The Court further finds that

Defendant's proposed sale of the subject

property does not include the "mausoleum

property." . . . Since the mausoleum

property is not being conveyed, the Court

finds that the Plaintiffs no longer have

standing as to the remaining property, and

would deny Plaintiffs relief on this basis,

in addition to the foregoing reasons.

Therefore, the Court finds for the

Defendant, The Okaloosa - Wal ton Community

College Foundation, Inc. and against the

Plaintiffs, and ORDERS and ADJUDGES as

follows:

A. Defendant Foundation's proposed

sale of the subject property is not in

derogation of Article VIII of the Last Will

and Testament of Mattie Kelly , or the deed

which conveyed the subject property to

Defendant Foundation. Therefore, Defendant

Foundation is not prohibited from selling

the subject property, excluding the

mausoleum property as described in Addendum

#4 to the Contract for Sale and Purch ase, in

order to fulfill the intent of Mattie Kelly

in creating the "Mattie M. Kelly Cultural

and Environmental Institute;" however, all

monies received from the sale of the subject

property, including any matching funds, are

to be used in the establishmen t and

operation of the Mattie M. Kelly Cultural

and Environmental Institute . [Emphasis

added.]

15. On June 8, 2005, Petitioners filed a Joint First

Amended Petition for Administrative Hearing, stating as follows

regarding standing:

5. Petitioner Hammet's substantial

interests will be affected by Respondent's

determination because she and her family

live within close proximity to the Mattie

Kelly property and have often used and

enjoyed the property for viewing the coastal

heritage of Northwest Fl orida, and she

wishes to continue to use and enjoy the

property in the future. The Mattie Kelly

property is a special place for Hammet and

her family, where they have many pleasant

memories and regularly have benefited from

this public property being in t heir

neighborhood. Hammet and her family will no

longer be able to use and enjoy this

accessible public resource if it is sold for

private development.

6. Petitioner Coastkeepers'

substantial interest will be affected by

Respondent's determinatio n because it is a

Florida non - profit corporation dedicated to

protection of the environment in an area of

the Gulf of Mexico Coast that includes

Okaloosa and Walton Counties and

Choctawhatchee Bay. Preservation of

environmentally sensitive lands such as t he

Mattie Kelly property, and having the Mattie

Kelly property as a location for biological

studies, marine science studies, and studies

of the coastal heritage of Northwest

Florida, are vitally important to protecting

Choctawhatchee Bay and the interest o f

Petitioner and its members, who include a

substantial number of members who reside in

Okaloosa and Walton Counties and have the

present intention to use, visit, enjoy, and

study biological, marine science and

cultural heritage issues associated with

Choc tawhatchee Bay, the Gulf of Mexico, and

the Mattie Kelly property at the Mattie

Kelly property. The Mattie Kelly property

is ideally suited to provide waterfront

environmental education in an otherwise

highly urbanized environment, including

education of local residents, which is vital

to controlling urban runoff, and for

highlighting, encouraging, and educating the

public of the need to protect Choctawhatchee

Bay and the Gulf of Mexico. The Mattie

Kelly property would no longer be available

for such inte nded pursuits were the proposed

sale of the Mattie Kelly property to private

development interest go forward. Moreover,

the proposed development of the very

property set aside by Mattie Kelly would

itself directly contribute to the urban

runoff known to b e causing problems in

Choctawhatchee Bay. Choctawhatchee Bay has

many examples of waterfront subdivision

development and very little opportunity for

environmental protection education in a

local setting near where waterfront

residential owners already liv e. These

purposes will not be as well - served by

educational efforts at OWC's main campus in

Niceville, which is not waterfront and miles

away from Choctawhatchee Bay. If properly

managed, the Mattie Kelly property should be

the field trip every school - ag e child in

Okaloosa and Walton County takes, which

would be a lasting legacy to Mattie Kelly

that would truly be consistent with her

express purposes. This opportunity will be

forever destroyed if the property is

developed as proposed.

16. On June 24, 2005, Respondent filed a Motion to Dismiss

Joint First Amended Petition for Administrative Hearing.

17. On July 5, 2005, Petitioners filed a Response to

Respondent's Motion to Dismiss Joint First Amended Petition for

Administrative Hearing.

18. Neit her of the Petitioners holds any title interest in

the property.

CONCLUSIONS OF LAW

19. The Division of Administrative Hearings has

jurisdiction pursuant to Sections 120.569 and 120.57(1), Florida

Statutes (2005).

Agency Action

20. Section 120.52(2), F lorida Statutes (2004), defines

agency action as follows:

(2) "Agency action" means the whole or

part of a rule or order, or the equivalent,

or the denial of a petition to adopt a rule

or issue an order. The term also includes

any denial of a requ est made under s.

120.54(7).

21. There is no statutory provision that requires the

Board to support/endorse the Foundation's activities on a case -

by - case basis. Accordingly, the Board was not required to

demand that the Foundation sell or not sell the property.

22. The Board does have a duty to certify that the

Foundation is operating "in a manner consistent with the goals

of the community college and in the best interest of the state."

See § 1004.70(1)(a)3., Fla. Stat. (2004). The Board's duty to

certify the Foundation does not require a decision on every

activity undertaken by the Foundation. However, the Board

performed its statutory duty on March 16, 2004, and took "agency

action" to certify the Foundation and endorse the sale of the

property. The right of the Board to act as an agency, and any

opportunity Petitioners have to oppose that action, is limited

by the June 3, 2005, First Circuit Court’s "Final Judgment for

Defendant," which details the proper use of the monies received

from the sal e of the property.

Standing

23. Section 120.52(10), Florida Statutes (2004), states as

follows in relevant part:

(12) "Party" means:

(a) Specifically named persons whose

substantial interests are being determined

in the proceeding.

24. To be a party to an administrative proceeding, one

needs to prove standing. In Agrico Chemical Co. v. Dept. of

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

1981), the court established a two - prong test for determining

when a person has stan ding in administrative proceedings. In

order to have a substantial interest in the outcome of the

proceeding, one must demonstrate the following: (a) injury in

fact, which is of sufficient immediacy to entitle one to hearing

pursuant to Section 120.57, F lorida Statutes (2004); and (b)

injury of a type or nature, which the proceeding is designed to

protect. See Agrico , 406 So. 2d at 482.

Injury in Fact

25. Petitioner Hammet claims injury in fact because she

will no longer be able to use and enjoy the pro perty for viewing

the coastal heritage of Northwest Florida if it is sold for

private development. Petitioner Coastkeepers claims injury in

fact on behalf of its members, who are dedicated to the

protection of the coastal environment.

26. To this point , the agency action at issue here does

not contravene the circuit court’s "Final Judgment for

Defendant" or elevate the matter to one of immediate concern.

Therefore, Petitioners’ claims are speculative as to both

Petitioners. There is no injury in fact.

Zone of Interest

27. Assuming, but not finding any injury in fact, the

following discussion is given concerning Petitioners zone of

interest. Petitioners' Joint First Amended Petition for

Administrative Hearing cites numerous statutes that allegedly

required reversal or modification of the Board's decision in

this case. During oral argument on July 8, 2005, Petitioners

argued that the following statutes support a determination that

their claims meet the zone of interest prong of the Agrico test.

28. Section 1001.64, Florida Statutes (2004), states as

follows in pertinent part:

1001.64 Community college boards of

trustees; powers and duties. --

(1) The boards of trustees shall be

responsible for cost - effective policy

decisions appropriate t o the community

college's mission, the implementation and

maintenance of high - quality education

programs within law and rules of the State

Board of Education, the measurement of

performance, the reporting of information

and the provision of input regarding state

policy, budgeting, and education standards.

(2) Each board of trustees is vested

with the responsibility to govern its

respective community college and with such

necessary authority as is needed for the

proper operation and improvement there of in

accordance with rules of the State Board of

Education.

* * *

(5) Each board of trustees shall have

responsibility for the use, maintenance,

protection, and control of community college

owned or community college controlled

buildings and groun ds, property and

equipment, name, trademarks and other

proprietary marks, and the financial and

other resources of the community college.

Such authority may include placing

restrictions on activities and on access to

facilities, firearms, food, tobacco,

a lcoholic beverages, distribution of printed

materials, commercial solicitation, animals,

and sound.

* * *

(27) Each board of trustees shall be

responsible for managing and protecting real

and personal property acquired or held in

trust for use by and for the benefit of such

community college. . . .

* * *

(34) Each board of trustees shall

administer the facilities program pursuant

to chapter 1013, including but not limited

to: the construction of public educational

and ancillary plants; th e acquisition and

disposal of property; compliance with

building and life safety codes; submission

of data and information relating to

facilities, and construction; use of

building and grounds; establishment of

safety and sanitation programs for the

protec tion of building occupants; and site

planning and selection.

* * *

(37) Each board of trustees may

purchase, acquire, receive, hold, own,

manage, lease, sell, dispose of, and convey

title to real property, in the best interest

of the community co llege.

* * *

(39) Each board of trustees shall

prescribe conditions for direct - support

organization to be certified and to use

community college property and services.

Conditions relating to certification must

provide for audit review and oversigh t by

the board of trustees .

* * *

(43) Each board of trustees has

responsibility for compliance with state and

federal laws, rules, regulations, and

requirements.

(44) Each board of trustees may adopt

rules, procedures, and policies related to

institutional governance, administration,

and management in order to promote orderly

and efficient operation, including, but not

limited to financial management, budget

management, physical plant management, and

property management. [Emphasis Added.]

29. Section 1004.01, Florida Statutes (2004), states as

following in relevant part:

1004.01 Statement of purpose and

mission. --

(1) The Legislature finds it in the

public interest to provide a system of

postsecondary education which is of t he

highest possible quality; which enables all

students to participate in the search for

knowledge and individual development; which

stresses undergraduate teaching as its main

priority; which offers selected

professional, graduate, and research

programs w ith emphasis on state and national

needs; which fosters diversity of

educational opportunity; which promotes

service to the public; which makes effective

and efficient use of human and physical

resources; which functions cooperatively

with other educationa l institutions and

systems; and which promotes internal

coordination and the wisest possible use of

resources.

(2) The mission of the state system of

postsecondary education is to develop human

resources, to discover and disseminate

knowledge, to extend knowledge and its

application beyond the boundaries of its

campuses, and to develop in students

heightened intellectual, cultural, and

humane sensitivities; scientific,

professional, and technological expertise;

and a sense of purpose. Inherent in t his

broad mission are methods of instruction,

research, extended training, and public

service designed to education people and

improve the human condition.

30. Section 1004.70, Florida Statutes (2004), states as

follows in pertinent part:

1004.7 0 Community college direct -

support organizations. --

(1) DEFINITIONS. -- For the purposes of

this section:

(a) "Community college direct - support

organization" means an organization that is:

1. A Florida corporation not for

profit, incorpora ted under the provision of

chapter 617 and approved by the Department

of State.

2. Organized and operated exclusively

to receive, hold, invest, and administer

property and to make expenditures to, or for

the benefit of, a community college in this

st ate.

3. An organization that that the

community college board of trustees, after

review, has certified to be operating in a

manner consistent with the goals of the

community college and in the best interest

of the state. Any organization that is

den ied certification by the board of

trustees may not use the name of the

community college that it serves . [Emphasis

added.]

31. Section 1010.09, Florida Statutes (2004), states as

follows:

1010.09 Direct - support organizations. -

- School district, c ommunity college, and

university direct - support organizations

shall be organized and conducted under the

provision of ss. 1001.453, 1004.28, and

1004.70 and rules of the State Board of

Education, as applicable.

32. Section 1010.10, Florida Statutes (2004 ), states as

follows in relevant part:

1010.10 Florida Uniform Management of

Institutional Funds Act. -

(1) SHORT TITLE. -- This section may be

cites as the "Florida Uniform Management of

Institutional Funds Act."

(2) DEFINITIONS. -- As used i n this

section, the term:

(a) "Endowment fund" means an

institutional fund, or any part thereof, not

wholly expendable by the institution on a

current basis under the terms of the

applicable gift instrument.

(b) "Governing board" means the body

responsible for the management of an

institution or of an institutional fund.

(c) "Institution" means an

incorporated or unincorporated organization

organized and operated exclusively for the

advancement of educational purposes, or a

governmental en tity to the extent that it

hold funds exclusively for educational

purposes.

(d) "Institutional fund" means a fund

held by an institution for its exclusive

use, benefit, or purposes. The term

excludes a fund held for an institution by a

trustee tha t is not an institution. The

term also excludes a fund in which a

beneficiary that is not an institution has

an interest, other than possible rights that

could arise upon violation or failure of the

purposes of the fund.

(c) "Instrument" means a w ill; deed;

grant; conveyance; agreement; memorandum;

electronic record; writing; or other

governing document, including the terms of

any institutional solicitations from which

an institution fund resulted, under which

property is transferred to or held by an

institution as an institutional fund.

(3) EXPENDITURE OF ENDOWMENT FUNDS. --

(a) A governing board may expend so

much of an endowment fund as the governing

board determines to be prudent for the uses

and purposes for which the endowment fund is

established, consistent with the goal of

conserving the purchasing power of the

endowment fund. In making its determination

the governing board shall use reasonable

care, skill and caution in considering the

following:

1. The purposes of the inst itution;

2. The intent of the donors or the

endowment fund;

3. The terms of the applicable

instrument ;

(4) The long - term and short - term needs

of the institution in carrying out its

purposes;

5. The general economic conditions;

6. The possible effect of inflation or

deflation;

7. The other resources of the

institution; and

8. Perpetuation of the endowment.

Expenditures made under this paragraph will

be considered prudent if the amount expended

is consistent with the goal of preserving

the purchasing power of the endowment fund.

* * *

(d) This subsection does not limit the

authority of a governing board to expend

funds as permitted under other law, the

terms of the instrument, or the charter of

the instituti on.

(e) Except as otherwise provided, this

subsection applies to instruments executed

or in effect before or after the effective

date of this section.

(4) STANDARD OF CONDUCT. --

(a) Members of a governing board shall

invest and manage an institutional fund as a

prudent investor would, by considering the

purposes, distribution requirements, and

other circumstances of the fund. In

satisfying this standard, the governing

board shall exercise reasonable care, skill

and caution.

(b) A go verning board's investment and

management decision about individual assets

shall be made not in isolation but in the

context of the institutional fund's

portfolio of investments as a whole and as a

part of an overall investment strategy that

provides risk and return objectives

reasonably suited to the fund and to the

institution.

(c) Among circumstances that a

governing board shall consider are:

1. Long - term and short - term needs of

the institution in carrying out its

purposes;

2. Its pre sent and anticipated

financial resources;

3. General economic conditions;

4. The possible effect of inflation or

deflation;

5. The expected tax consequences, if

any of investment decisions or strategies;

6. The role that each invest ment or

course of action plays within the overall

investment portfolio of the institutional

fund;

7. The expected total return from

income and the appreciation of its

investments;

8. Other resources of the institution;

9. The needs of the institution and

the institutional fund for liquidity,

regularity of income, and preservation of

appreciation of capital; and

10. An asset's special relationship or

special value, if any, to the purposes of

the applicable gift instrument or to the

in stitution.

(d) A governing board shall make a

reasonable effort to verify the facts

relevant to the investment and management of

institutional funds assets.

(e) A governing board shall diversify

the investments of an institutional fund

unless t he board reasonably determines that,

because of special circumstances, the

purposes of the fund are better served

without diversifying.

(f) A governing board shall invest and

manage the assets of an institutional fund

solely in the interest of the in stitution.

* * *

(8) RELEASE OF RESTRICTION ON USE OR

INVESTMENT. --

(a) With the written consent of the

don or, a governing board may release, in

whole or in part, a restriction imposed by

the applicable instrument on the use or

investment of an institutional fund.

* * *

(c) If written consent of the donor

cannot be obtained by reason of the donor's

death, disability, unavailability, or

impossibility of identification, a governing

board may apply in the name of the

institution to the ci rcuit court of the

county in which the institution is located

for release of a restriction imposed by the

applicable instrument on the use or

investment of an institutional fund. The

Attorney General shall be notified of the

application and shall be given a opportunity

to be heard. If the court finds that the

restriction is unlawful, impracticable,

impossible to achieve, or wasteful, it may

by order release the restriction in whole or

in part. A release under this subsection

may not change an endowment f und to a fund

that is not an endowment fund. [Emphasis

Added.]

33. Section 1011.85, Florida Statutes (2004),

states as follows in pertinent part:

1011.85 Dr. Philip Benjamin Matching

Grant Program for Community Colleges. --

(1) There is cre ated the Dr. Philip

Benjamin Matching Grant Program for

Community Colleges as a single matching

gifts program . . . . The program shall be

administered according to rules of the State

Board of Education and used to encourage

private support in enhancing c ommunity

colleges by providing the community college

system with the opportunity to receive and

match challenge grants. . . .

(2) Each community college board of

trustees receiving state appropriation under

this program shall approve each gift to

ens ure alignment with the unique mission of

the community college. The board of

trustees must link all requests for a state

match to the goals and mission statement. .

. .

(3) Upon approval by the community

college board of trustees and the State

Board of Education, the ordering of

donations for priority listing of unmatched

gifts should be determined by the submitting

community college.

(4) Each year, eligible contributions

received by a community college's foundation

or the State Board of Educati on by February

1 shall be eligible for state matching

funds.

* * *

(b) Community colleges must submit to

the State Board of Education an annual

expenditure report tracking the use of all

matching funds.

(c) The audit of each foundation

receiving state funds from this program must

include a certification of accuracy in the

amount reported for matching funds.

* * *

(7) The community college board of

trustees, in conjunction with the donor,

shall make the determination of whether

s cholarships established pursuant to the

program are endowed.

* * *

(9) Each community college entity

shall establish its own matching grant

program fund as a depository for the private

contributions and matching state funds

provided under this se ction. Community

college foundations are responsible for the

maintenance, investment, and administration

of their matching grant program funds.

* * *

(110 The board of trustees of the

community college and the State Board of

Education are respon sible for determining

the uses for the proceeds of their

respective trust funds. Such use of the

proceeds shall include, but not be limited

to, expenditure of the funds for:

(a) Scientific and technical

equipment.

(b) Scholarships, loans, or n eed - based

grants.

(c) Other activities that will benefit

future students as well as students

currently enrolled at the community college,

will improve the quality of education at the

community college, or will enhance economic

development in the comm unity.

34. Section 1013.28, Florida Statutes (2004), states as

follows in relevant part:

1013.28 Disposal of property. --

(1) REAL PROPERTY. -- Subject to rules

of the State Board of Education, a board may

dispose of any land or real property that

is, by resolution of the board determined to

be unnecessary for educational purposes as

recommended in an educational plant survey.

A board shall take diligent measures to

dispose of educational property only in the

best interests of the public. However ,

appraisals may be obtained by the board

prior to or simultaneously with the receipt

of bids.

35. Concerning the duties and responsibilities of the

Board, the above - quoted statutes do not protect a citizen's

desire to continue to use and enjoy propert y owned by or held in

trust for a college. The statutes do not protect an

environmental group's future use of the property for scientific

or educational purposes. The Petitioners' alleged injuries are

not of a type or nature that the statutory scheme is designed to

protect. Therefore, the Petitioners lack standing.

RECOMMENDATION

Based on the forgoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED:

That the Board enter a final order dismissing the Petitions

for Administrative Hearing.

DONE AND ENTERED this 22nd day of August, 2005, in

Tallahassee, Leon County, Florida.

S

SUZANNE F. HOOD

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Flor ida 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 22nd day of August, 2005.

COPIES FURNISHED :

James R. Richburg, President

Okaloosa - Walto n Community College

100 College Boulevard

Niceville, Florida 32578 - 1295

Joseph D. Lorenz, Esquire

1270 North Elgin Parkway, Suite C - 12

Shalimar, Florida 32579

Steven A. Medina, Esquire

Levin, Papantonio, Thomas, Mitchell,

Echsner & Proctor, P.A.

316 South Baylen Street

Post Office Box 12308

Pensacola, Florida 32581

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

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

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.