05-004511 In Re: Petition For Rule Amendment-Tomoka Community Development District vs. * Status: Closed Recommended Order on Wednesday, May 10, 2006.

Summary: Petitioner presented evidence in support of expanding the boundaries of the community development district to what was intended but for incorrect legal description.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

IN RE: PETITION TO AMEND THE )

BOUNDARIES OF THE TOMOKA )

COMMUNITY DEVELOPMENT DISTRICT ) Case No. 05 - 4511

)

ADMINISTRATIVE LAW JUDGE'S REPORT TO

THE FLORIDA LAND AND WATER ADJUDICATORY COMMISSION

Pursuant to Section 190.005(1)(d), Florida Statutes, 1

J. Lawrence Johnston, an Administrative Law Judge (ALJ) of the

Division of Administrative Hearings (DOAH), conducted a local

public hearing, in Palm Coast, Florid a, on February 22, 2006.

APPEARANCES

For Petitioner: Jonathan T. Johnson, Esquire

Wesley S. Haber, Esquire

Hopping Green & Sams, P.A.

123 South Calhoun Street

Post Office Box 6526

Tallahassee, Florida 32314

STATEMENT OF THE ISSUE

At issue in this case is whether the Florida Land and Water

Adjudicatory Commission (FLWAC) should grant the Petition to

Amend the Boundaries of the Tomoka Community Development

District filed on November 23, 2005 (Petition). The purpose of

the Pe tition is to add 1,122 acres that were intended to be

included in the Community Development District (CDD, or

District) when it was created in October 2003 but were omitted

through the inadvertent use of an erroneous legal description.

PRELIMINARY STATEM ENT

On October 2, 2003, FLWAC adopted Florida Administrative

Code Rule Chapter 42LL - 1 2 establishing the CDD on land in Flagler

County. Subsequently, it was determined that the legal

description used to establish the CDD was erroneous and

inadvertently om itted 1,122 acres. Instead of creating a CDD of

approximately 1,968 acres, only 846 acres were included. To

correct this error, the CDD's board of supervisors filed the

Petition.

On December 9, 2005, FLWAC's Secretary certified under Rule

42 - 1.009 tha t the Petition contained all required elements and

forwarded it to DOAH for the local public hearing required under

Section 190.005(1)(d), Florida Statutes.

As required by Rule 42 - 1.010, FLWAC published a Notice of

Receipt of Petition in the Florida Adm inistrative Weekly on

February 3, 2006.

Flagler County held a public hearing on February 6, 2006,

and passed Resolution 2006 - 12 conditionally approving the

amendment of the CDD's boundaries. A copy of Flagler County's

Resolution 2006 - 12 was received in evidence as Petitioner's

Hearing Exhibit L. 3

A local public hearing was held in Palm Coast, Flagler

County, Florida, on February 22, 2006. At the hearing,

Petitioner presented three witnesses: Cynthia C. Jones,

president of Intervest Construction, Inc. ; Jerry Finley,

managing general partner of the firm Finley Engineering Group,

an expert in civil engineering; and James A. Perry, of

Governmental Management Services, LLC, an expert in the field of

economics and financial analysis. One member of the publ ic

attended the hearing and commented, as did a representative of

Flagler County. Petitioner also offered Hearing Exhibits A

through R, which were received in evidence.

On February 23, 2006, Petitioner filed an Amended Petition

with attached exhibits su pplemented, revised, and substituted in

accordance with the evidence presented at the hearing. On

March 6, 2006, Petitioner filed an affidavit in response to some

of the public comment at the hearing.

Petitioner caused a transcript of the local public hearing

to be prepared. The Transcript was filed on March 9, 2006.

However, it misspelled the name of the CDD, and a corrected

Transcript was filed on April 18, 2006, together with a Proposed

Report of Findings and Conclusions.

SUMMARY OF PETITIONS AND EVIDENCE

1. As indicated in the Preliminary Statement, by adopting

Rule Chapter 42LL - 1, FLWAC established the Tomoka CDD on land in

Flagler County. Subsequently, after the entry of a final

judgment validating up to $50 million in bonds to pay for

improv ements in the CDD, and the issuance of $8,250,000 of

bonds, it was determined that the legal description used to

establish the CDD was erroneous and inadvertently omitted 1,122

acres. Instead of creating a CDD of approximately 1,968 acres,

only 846 acres were included. To correct this error, the CDD's

board of supervisors filed the Petition with FLWAC.

A. Petition and Amended Petition

2. The Petition, with nine exhibits, was received in

evidence as Hearing Exhibit A.

3. The Petition asserts that Fl agler County was paid the

"requisite" filing fees. It is not clear whether Petitioner

considered the requisite amount to be $15,000 or $1,500.

4. The Petition stated the name of the CDD but did not

list the names of the members of the board of supervis ors.

Petition Exhibit 7 designated future general distribution,

location, and extent of public and private uses of land in the

future land use element of the appropriate general purpose local

government. The Petition did not contain a separate map showin g

current major trunk water mains and sewer interceptors and

outfalls, if any. The Petition stated that construction of the

improvements to the expansion parcel is expected to be complete

in 2006. However, it also attached Petition Exhibit 8, the

CDD's I mprovement Plan dated October 2003, which stated that

lands in the CDD "are to be developed in several phases,

spanning approximately 10 years" and that "scheduled completion

for Phase 1 Construction is anticipated in 2004." Petition

Exhibit 9 was a State ment of Estimated Regulatory Costs (SERC).

5. Petitioner recognized that the Petition, as filed with

FLWAC, contained errors and was not up - to - date as of the time of

the hearing. For those reasons, corrections and up - dates were

made by Petitioner durin g the hearing.

6. Hearing Exhibit B supplemented Petition Exhibit 6.

Witness Jones testified that the written consents in Petition

Exhibit 6, together with the supplemental written consents in

Hearing Exhibit B, accounted for one hundred percent of the

owners of the real property located within the lands to be

included in the expansion parcel.

7. Hearing Exhibit C corrected and replaced legal

description in Petition Exhibit 4.

8. Hearing Exhibit D corrected and replaced Petition

Exhibit 5, the nam es and addresses of the owners of excluded

out - parcels .

9. Hearing Exhibit E, an affidavit as to the estimated

costs of CDD improvements, corrected and replaced Petition

Exhibit 8, which was an Improvement Plan for the District dated

October 2003. The affidavit states that estimated development

costs for the CDD total $53,351,719; the Improvement Plan

estimated total costs for public improvements in Westlake, which

accounts for all but $695,984 of the total in the affidavit, at

$37,442,000.

10. Petitio ner then re - introduced Petition Exhibit 8

(already in evidence as part of Hearing Exhibit A) as Hearing

Exhibit F.

11. Witness Jones testified that the Petition, and its

attached exhibits, as modified by the evidence presented at the

hearing, was true a nd correct to the best of her knowledge.

12. Witness Perry testified that his firm prepared

Petition Exhibit 9, the SERC. Witness Perry testified that the

SERC was true and correct to the best of his knowledge.

13. The SERC included in the Petition contained an

estimate of the costs and benefits to all persons directly

affected by the proposed rule to amend the District -- the State

of Florida and its citizens, the County and its citizens, the

Petitioner, and consumers. However, the SERC's Table 2, Cost

Estimate for District Facilities, was based on the Improvement

Plan for the District dated October 2003, and does not match

Hearing Exhibit E's estimated costs of CDD improvements. See

Finding 9, supra . The discrepancy in estimated cost of

improveme nts between Hearing Exhibit E and the SERC was not

explained. It would appear that the SERC was not adjusted to

reflect a new, higher estimate.

14. Beyond administrative costs related to rule adoption,

the State and its citizens will incur virtually no costs from

amending the District in addition to the minimal costs already

incurred from its original creation, which are related to the

incremental costs to various agencies of reviewing one

additional local government report. The District, as proposed

t o be amended, will require no subsidies from the State.

15. Administrative costs incurred by the County related to

rule adoption should be minimal and are offset by the required

filing fee to Flagler County. Benefits to the County will

include improved planning and coordination of development,

without incurring any administrative or maintenance burden for

facilities and services within the District, as proposed to be

amended, except for those the County chooses to accept.

16. Consumers will pay non - a d valorem or special

assessments for the District facilities. Location within the

District is voluntary. Generally, District financing will be

less expensive than maintenance through a property owners'

association or capital improvements financed through developer

loans. Benefits to consumers in the area within the CDD 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 sh are

of direct control over community development services and

facilities within the area. Ultimately, the property owners

within the District as well as the users of the District

facilities choose to accept the Districts costs in return for

the benefits t hat the District provides.

17. As indicated in the Preliminary Statement, an Amended

Petition was filed post - hearing to reflect the corrections,

supplemental information, and substitutions made during the

hearing. The Amended Petition's Exhibit 8 corre sponded with

Hearing Exhibit E, not the original Petition Exhibit 8 (the

Improvement Plan dated October 2003). The Amended Petition did

not include the Improvement Plan dated October 2003, but it also

did not modify the SERC, which referred to the Improve ment Plan

for the estimate of costs of improvements.

B. Whether the establishment of the District is inconsistent

with any applicable element or portion of the State

Comprehensive Plan or of the effective local government

comprehensive plan

18. At th e hearing, Petitioner introduced in evidence the

affidavit of Suzanne Van Wyk that the "Petition is not

inconsistent with any applicable provision of the State

Comprehensive Plan."

19. Ms. Van Wyk’s affidavit identifies goals and policies

which are con sistent with and are furthered by the Petition.

The goals and policies identified in Ms. Van Wyk’s affidavit

include Policy (b)1. of Goal 15, Land Use; Policy (b)6. of Goal

17, Public Facilities; and Policy (b)2. of Goal 20, Governmental

Efficiency.

20 . Additionally, Ms. Van Wyk’s affidavit notes that the

development of the area to be added to the District implements

the local comprehensive plan "by directing development to an

area planned for mixed use, medium density development of the

County’s Futur e Land Use Map."

21. Witness Perry testified that he reviewed the proposed

boundary amendment of the District in light of the requirements

of the State Comprehensive Plan, Chapter 187, Florida Statutes.

22. According to Mr. Perry, two subjects of t he State

Comprehensive Plan apply directly to the boundary amendment to

the District, as do the policies supporting those subjects.

Specifically, Mr. Perry noted that the amendment of the

District’s boundaries furthers Goals 17 and 20 of the State

Comprehe nsive Plan. Subject 17, Public Facilities, directs the

state to protect the substantial investments that already exist

and plan for and finance new facilities to serve residents in a

timely, orderly and efficient manner. Subject 20, Government

Efficiency , directs the Florida government to economically and

efficiently provide the amount and quality of services required

by the public.

23. According to the evidence, amending the boundary will

have no impact on the District’s ability to fulfill its

obliga tions to residents and third parties. To the contrary, it

will accomplish what was intended when the CDD was established

in 2003. The amended District would finance and deliver its

public facilities, and the board of supervisors will be able to

provide t he level and quality of service required by those who

benefit and pay for the services.

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

District, as proposed to be amended, will not be inconsistent

with any applicable element or portion of t he State

Comprehensive Plan.

C. Whether 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 community

25 . Testimony on this factor was provided by witnesses

Jones, Finley, and Perry. The lands that comprise the District,

as amended, consist of approximately 1,968 acres, located

entirely within the borders of Flagler County, Florida. All of

the land in the District, as proposed to b e amended, is part of

a planned community included in the West Lake portion of the

Plantation Bay Development of Regional Impact, as intended when

the CDD was established in 2003.

26. Based on the evidence, the area of land to be included

in the Distric t, as proposed to be amended, is of sufficient

size, is sufficiently compact, and is sufficiently contiguous to

be developed as a single functionally interrelated community.

D. Whether the proposed District is the best alternative

available for deliverin g community development services and

facilities to the area that will be served by the proposed

District

27. According to Mr. Perry, only the District has planned

to include the services and facilities proposed in the District.

28. Mr. Perry also test ified that there are two

alternatives for providing community development services to the

expansion parcel. First, the County might provide facilities

and services from its general fund. Second, facilities and

services might be provided by some private m eans, with

maintenance delegated to a property owners' association (POA).

29. The St. Johns River Water Management District prefers

a CDD to the alternatives.

30. It is Mr. Perry’s opinion that the District is the

best alternative to provide services and facilities needed for

the land in the expansion parcel. This is especially true since

the District has planned for improvements, validated bonds, and

started construction in portions of the expansion parcel under

the mistaken belief that the expansio n parcel already was part

of the CDD. The infrastructure still needed for the expansion

parcel is of the same type the District has already provided

there.

31. Amending the District’s boundaries will enable the

District to continue to successfully mana ge its existing

services and facilities and accomplish what was intended when

the CDD was established in 2003.

32. Based on the evidence, the District, as proposed to be

amended, is the best alternative available for delivering

community development ser vices and facilities to the area that

will be served by the District.

E. 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

developme nt services and facilities

33. The evidence was that the services and facilities

proposed to be provided by the District are not incompatible

with uses and existing local and regional facilities and

services. The District's facilities and services withi n the

expansion parcel will not duplicate any existing regional

services or facilities which are provided to the lands within

the District by another entity.

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

amenable to separate special - district government

34. As cited previously, the area of land to be included

in the proposed amended boundary of the District is of

sufficient size, is sufficiently compact, and is sufficiently

contiguous to be developed and become a functionally

interrelated co mmunity.

35. Additionally, the area that will be served by the

District, as proposed to be amended, is amenable to separate

special - district government, especially since District

facilities already have been planned for, financed, and

partially constru cted in the expansion parcel under the mistaken

belief that the expansion parcel already was part of the CDD.

G. Publication of Notice

36. Petitioner published notice of the local public

hearing in a newspaper of general paid circulation in Flagler

Coun ty for four consecutive weeks prior to the hearing, on

January 24, 2006; January 31, 2006; February 7, 2006; and

February 14, 2006.

H. Local Government Support for Establishment

37. Pursuant to the requirements of Sections 190.046 and

190.005(1)(b), Fl orida Statutes, Petitioner filed a copy of the

Petition and a filing fee with Flagler County.

38. The Flagler County Commission held a public hearing on

the boundary amendment of the District, as permitted by Section

190.005(1)(c), Florida Statutes. A s a result of that hearing,

the County passed Resolution 2006 - 12 conditionally approving the

amendment of the CDD's boundaries.

39. The requirements in the County’s resolution include:

(1) agreement by the District that it will not undertake to own,

o perate or otherwise finance any utility facility within the

boundaries of the District without the County’s prior consent;

(2) revision to Petition Exhibit 5 correcting the owners of the

outparcels; (3) correcting the legal description in Petition

Exhibit 4; (4) a certified boundary survey labeling all points

of beginning as referenced in the legal description; (5) various

comments regarding Petition Exhibit 8, which was the District’s

improvement plan. As noted below, Petitioner addressed the

County’s req uirements.

40. With respect to the first requirement, District agreed

not to undertake to own, operate or otherwise finance any

utility facility within the boundaries of the District without

the County’s prior consent.

41. With respect to the County’s se cond requirement,

Petitioner submitted Exhibit D at the time of the hearing.

Exhibit D correctly lists the owners of the out - parcels.

42. With respect to the third requirement, which asked for

the correction of the District’s legal description, Petitione r

submitted Exhibit C at the time of the hearing. Exhibit C

corrects the errors noted in the County’s resolution.

43. The fourth requirement in the County’s resolution

asked that the District provide a certified boundary survey

labeling all points of b eginning as referenced in the legal

descriptions. The purpose of this request was to confirm the

accuracy of the legal description. At the time of the County’s

public hearing, the County agreed to accept a letter from

Jerry Finley confirming the accuracy of the legal description in

lieu of the certified boundary survey. A copy of the letter

from Mr. Finley to the County confirming the accuracy of the

legal description of the amended district was submitted at the

local public hearing as Exhibit Q. Walter Fufidio, who attended

the public hearing on behalf of Flagler County, accepted witness

Finley’s letter in lieu of the certified boundary survey.

44. With respect to the fourth requirement, the County’s

resolution included various comments about the im provement plan

included in Petition Exhibit 8. The primary reason this exhibit

was included with the Petition was to set forth the estimated

costs of construction for the District, as amended. To address

the County's concerns with the improvement plan, a t the time of

the hearing, Petitioner introduced the affidavit of Douglas R.

Ross as Exhibit E. Mr. Ross’s affidavit set forth the estimated

cost of construction for the District, as amended, and replaced

the improvement plan in its entirety. In addition to replacing

the improvement plan with Mr. Ross’s affidavit, in order to

address the County’s concerns, Petitioner also submitted Exhibit

P, which is a letter from Jerry Finley, the District’s engineer,

addressing the issues the County raised regarding th e

improvement plan.

I. Public Comment

45. With the exception of the County representative, only

one member of the public, Russell Reinke (misspelled "Relenke"

in the Transcript), commented during the public hearing. Based

on the address he gave at t he hearing, Mr. Reinke is not a

resident of the District. (Affidavit Of Cynthia C. Jones filed

with DOAH on March 6, 2006).

46. Mr. Reinke's comments raised the following concerns:

(1) where he could review the documents submitted on behalf of

the Pe titioner; (2) who is going to pay for the debt service

that would have been covered by the assessments collected on the

property that was left out of the District; (3) what needs to

take place if the District seeks to raise assessments; (4)

whether the Dis trict can pay for infrastructure constructed

outside its boundaries; and (5) the validity of the bonds given

the error in the legal description. Several of Mr. Reinke's

concerns were not relevant to whether or not the Petition, as

amended, meets the appli cable factors set forth in Section

190.005, Florida Statutes, but all were addressed by

representations from counsel for Petitioner during the hearing,

as follows: (1) the documents submitted at the hearing would be

made available for review by the public at the Plantation Bay

POA's offices; (2) the developer has been paying the portion of

the assessments property owners in the expansion parcel were

expected to pay, under the mistaken belief that they were part

of the CDD, assessments on property in the ex pansion parcel will

not begin until the boundaries are expanded by rule, and

property in the expansion parcel will not be assessed

retroactively; (3) the board of supervisors would have to vote

on assessments, in accordance with the statutory CDD charter;

(4) the District already has paid for infrastructure constructed

outside its boundaries, but expansion of the CDD by rule will

"recapture" that infrastructure; and (5) the bonds have been

declared valid, notwithstanding the error in the legal

description.

APPLICABLE LAW

J. Procedure

47. Section 190.005(1), Florida Statutes, provides that

the exclusive and uniform method for establishing a community

development district of 1,000 acres or more shall be by rule

adopted by FLWAC's granting a petition for the establishment of

a CDD. Section 190.005(2), Florida Statutes, provides that the

exclusive and uniform method for establishing a CDD of less than

1,000 acres shall be pursuant to an ordinance adopted by the

county commission of the county having jurisdict ion over the

majority of land in the area in which the district is to be

located -- in this case, Flagler County.

48. The Tomoka CDD, with its erroneous legal description,

was established using the first method, even though the actual

acreage was under 1, 000 acres.

49. Section 190.046(1), Florida Statutes, provides:

The board may petition to contract or expand

the boundaries of a community development

district in the following manner:

(a) The petition shall contain the same

information required by s. 190.005(1)(a)1.

and 8. In addition, if the petitioner seeks

to expand the district, the petition shall

describe the proposed timetable for

construction of any district services to the

area, the estimated cost of constructing the

proposed services, and the designation of

the future general distribution, location,

and extent of public and private uses of

land proposed for the area by the future

land use plan element of the adopted local

government local comprehensive plan. If the

petitioner seeks to con tract the district,

the petition shall describe what services

and facilities are currently provided by the

district to the area being removed, and the

designation of the future general

distribution, location, and extent of public

and private uses of land p roposed for the

area by the future land element of the

adopted local government comprehensive plan.

(b) For those districts initially

established by county ordinance, the

petition for ordinance amendment shall be

filed with the county commission. If t he

land to be included or excluded is, in whole

or in part, within the boundaries of a

municipality, then the county commission

shall not amend the ordinance without

municipal approval. A public hearing shall

be held in the same manner and with the same

p ublic notice as other ordinance amendments.

The county commission shall consider the

record of the public hearing and the factors

set forth in s. 190.005(1)(e) in making its

determination to grant or deny the petition

for ordinance amendment.

(c) For t hose districts initially

established by municipal ordinance pursuant

to s. 190.005(2)(e), the municipality shall

assume the duties of the county commission

set forth in paragraph (b); however, if any

of the land to be included or excluded, in

whole or in p art, is outside the boundaries

of the municipality, then the municipality

shall not amend its ordinance without county

commission approval.

(d) 1. For those districts initially

established by administrative rule pursuant

to s. 190.005(1), the petition shall be

filed with the Florida Land and Water

Adjudicatory Commission.

2. Prior to filing the petition, the

petitioner shall pay a filing fee of $1,500

to the county and to each municipality the

boundaries of which are contiguous with or

contain all o r a portion of the land within

the district or the proposed amendment, and

submit a copy of the petition to the county

and to each such municipality. In addition,

if the district is not the petitioner, the

petitioner shall file the petition with the

distr ict board of supervisors.

3. The county and each municipality shall

have the option of holding a public hearing

as provided by s. 190.005(1)(c). However,

such public hearing shall be limited to

consideration of the contents of the

petition and whether the petition for

amendment should be supported by the county

or municipality.

4. The district board of supervisors

shall, in lieu of a hearing officer, hold

the local public hearing provided for by s.

190.005(1)(d). This local public hearing

shall be noticed in the same manner as

provided in s. 190.005(1)(d). Within 45

days of the conclusion of the hearing, the

district board of supervisors shall transmit

to the Florida Land and Water Adjudicatory

Commission the full record of the local

hearing, the transcript of the hearing, any

resolutions adopted by the local general -

purpose governments, and its recommendation

whether to grant the petition for amendment.

The commission shall then proceed in

accordance with s. 190.005(1)(e).

5. A rule amending a district boundary

shall describe the land to be added or

deleted.

(e) In all cases, written consent of all

the landowners whose land is to be added to

or deleted from the district shall be

required. The filing of the petition for

expansion or contrac tion by the district

board of supervisors shall constitute

consent of the landowners within the

district other than of landowners whose land

is proposed to be added to or removed from

the district.

(f) 1. During the existence of a

district initially e stablished by

administrative rule, petitions to amend the

boundaries of the district pursuant to

paragraphs (a) - (e) shall be limited to a

cumulative total of no more than 10 percent

of the land in the initial district, and in

no event shall all such petiti ons to amend

the boundaries ever encompass more than a

total of 250 acres.

2. For districts initially established by

county or municipal ordinance, the

limitation provided by this paragraph shall

be a cumulative total of no more than 50

percent of the land in the initial district,

and in no event shall all such petitions to

amend the boundaries ever encompass more

than a total of 500 acres.

3. Boundary expansions for districts

initially established by county or municipal

ordinance shall follow the p rocedure set

forth in paragraph (b) or paragraph (c).

(g) Petitions to amend the boundaries of

the district which exceed the amount of land

specified in paragraph (f) shall be

considered petitions to establish a new

district and shall follow all of the

procedures specified in s. 190.005.

Use of paragraph (g), and consideration of the Petition (and

Amended Petition) as petitions to establish a new district

probably would cure the defect in the original establishment.

Cf. Conclusion 48, supra .

50. Se ction 190.005(1)(a)1. requires that a petition to

establish a CDD filed with FLWAC must describe by metes and

bounds the area to be serviced by the CDD with a specific

description of real property to be excluded from the district.

Paragraph 8 requires the petition to contain a SERC meeting the

requirements of Section 120.541, Florida Statutes.

51. Other requirements of Section 190.005(1)(a) are that a

petition to establish a CDD filed with FLWAC: set forth that

the petitioner has the written consent of the owners of all of

the real property proposed to be in the CDD, or has control by

"deed, trust agreement, contract or option" of all of the real

property (¶2); designate the five initial members of the board

of supervisors of the CDD (¶3); propose the d istrict's name

(¶4); contain a map showing current major trunk water mains and

sewer interceptors and outfalls, if any (¶5); propose a

timetable for construction and an estimate of construction costs

(¶6); and designate future general distribution, locatio n, and

extent of public and private uses of land in the future land use

element of the appropriate general purpose local government

(¶7).

52. Section 190.005(1)(b), Florida Statutes, requires that

the petitioner pay a filing fee of $15,000 to the county and to

each municipality the boundaries of which are contiguous with,

or contain all or a portion of, the land within the external

boundaries of the district. The petitioner also must submit a

copy of the petition on those local, general - purpose

governme nts.

53. Section 190.005(1)(c), Florida Statutes, permits the

county and each municipality described in the preceding

paragraph to conduct a public hearing on the petition. Such

local, general - purpose governments may then present resolutions

to FLWAC a s to the establishment of a CDD on the property

proposed in the petition.

54. Section 190.005(1)(d), Florida Statutes, requires an

ALJ to conduct a local public hearing pursuant to Chapter 120,

Florida Statutes, and states that the hearing "shall includ e

oral and written comments on the petition pertinent to the

factors specified in paragraph (e)." Florida Administrative

Code Rule 42 - 1.012 provides that "all persons shall have an

opportunity to present evidence and argument on all issues

involved" and t hat the ALJ "shall permit parties to examine and

cross - examine or question witnesses." Section 190.005(1)(d),

Florida Statutes, also specifies that the petitioner publish

notice of the local public hearing once a week for the four

successive weeks immedia tely prior to the hearing.

55. The circumstances of this case raise questions

regarding the proper procedure. Since the Petition (and Amended

Petition) propose to add more than 1,000 acres, albeit acreage

intended to be included in the establishment of the CDD in 2003,

it would appear that, under Section 190.046(1)(f) - (g), Florida

Statutes, the Petition (and Amended Petition) should be

considered petitions to establish a new district and would have

to "follow all of the procedures specified in s. 190.00 5." That

would explain why the board of supervisors did not hold the

local public hearing under Section 190.046(1)(d)4., Florida

Statutes. But it would not eliminate other questions regarding

procedure.

56. Section 190.005(1)(a)2., Florida Statutes, r equires

the written consent of the owners of all of the real property

proposed to be in the CDD, while Section 190.046(1)(e), Florida

Statutes, only requires the written consents of the owners of

the expansion parcel (since the filing of the petition for

e xpansion by the district's board of supervisors constitutes the

consent of all other landowners under that statute.) If Section

190.005(1)(a)2., Florida Statutes, is "procedure," it would

govern. However, in at least one case, FLWAC has granted a

petitio n to contract a CDD's boundaries when only the written

consent of the owners of the parcel to be deleted from the CDD

was obtained. See In Re: Petition To Contract The Tampa Palms

Open Space And Transportation Community Development District ,

DOAH Case No. 96 - 4213, 1997 Fla. Div. Adm. Hear. LEXIS 5229

(DOAH Report January 29, 1997)(Rule 42J - 1.002 amended on

July 31, 1997). It would appear from the precedent that FLWAC

does not consider Section 190.005(1)(a)2., Florida Statutes, to

be "procedure." That bei ng the case, Section 190.046(1)(e),

Florida Statutes, would apply, and the board of supervisors, in

filing the Petition (and Amended Petition), would be presumed to

have consented on behalf of all owners of land in the CDD other

than the expansion parcel.

57. As to Section 190.005(1)(a)3., the Petition (and

Amended Petition) do not designate the five initial members of

the board of supervisors of the CDD. Although no direct

precedent has been located, if paragraph 2 of the statute is not

considered "pro cedure," paragraph 3 probably also would not be

considered "procedure." In any event, paragraph 3 does not seem

applicable to amendment of the boundaries of a CDD.

58. As to Section 190.005(1)(a)5., the Petition (and

Amended Petition) do not appear to contain a map showing current

major trunk water mains and sewer interceptors and outfalls, if

any. Although no direct precedent has been located, if

paragraphs 2 and 3 of the statute are not considered

"procedure," paragraph 5 probably also would not be c onsidered

"procedure." In any event, paragraph 5 may no longer be

applicable in this case, where the boundary amendment would

accomplish what was intended in establishing the CDD.

59. As to Section 190.005(1)(a)8., the Petition (and

Amended Petition) c ontained a SERC. The question is whether the

SERC meets the requirements of Section 120.541, Florida

Statutes, even though its estimated construction costs did not

match other information in the record. Although no direct

precedent has been located, if p aragraphs 2, 3, and 5 of the

statute are not considered "procedure," paragraph 8 probably

also would not be considered "procedure." In any event, taken

as a whole, and in light of the other evidence in the record,

the SERC probably complies with Section 1 20.541, Florida

Statutes.

60. Under Section 190.005(1)(b)1., Florida Statutes, the

filing fee is $15,000, not the $1,500 filing fee required under

Section 190.046(1)(d)2., Florida Statutes. But FLWAC has

granted petitions for boundary amendments exceed ing the limits

in Section 190.046( 1)(f) - (g), Florida Statutes, where the local

government did not require payment of the $15,000 filing fee

required under Section 190.005(1)(b)2., Florida Statutes. See

In Re: Petition For Rule Amendment - Fiddler's Creek Community

Development District , DOAH Case No. Case No. 02 - 4357, ---- Fla.

Div. Adm. Hear. LEXIS ---- , 2003 WL 603380, *13 (DOAH Report

February 25, 2003)(Rule 42X - 1.002 amended September 16,

2003)(county accepted $1,500 as payment in full, waiving any

addi tional fee, because of the net "wash" of expansions and

contraction acreage and because that amount more than paid for

County staff work in connection with the CDD); In Re: Petition

to Contract the Circle Square Woods Community Development

District , DOAH C ase No. 02 - 1118, 2002 Fla. Div. Adm. Hear. LEXIS

1017 (DOAH Report June 24, 2002)(Rule 42S - 1.002 amended

October 1, 2002)(county waived the filing fee). In one case, a

CDD was initially established by FLWAC where the required fees

were waived. In Re: Pet ition for Rule Creation - Tesoro

Community Development District , DOAH Case No. 04 - 1042, 2004 Fla.

Div. Adm. Hear. LEXIS 1937 (DOAH Report July 13, 2004)(Rule

42XX - 1.001 adopted January 10, 2005)(county and municipality

waived the filing fee).

61. It is not clear whether the filing fee Petitioner paid

to Flagler County was $1,500 or $15,000. In any event, Flagler

County's resolution of conditional approval accepted the amount

paid. Under the precedents, either the filing fee should not be

considered a m atter of "procedure," making $1,500 the requisite

fee, or the County effectively waived any shortfall, making the

fee paid acceptable.

K. Six Factors to be Considered

62. Section 190.005(1)(e), Florida Statutes, provides that

FLWAC consider the entire r ecord of the local hearing, the

transcript of the hearing, resolutions adopted by local general -

purpose governments as provided in paragraph (c), and the

following factors and make a determination to grant or deny a

petition for the establishment of a comm unity development

district:

1. Whether all statements contained within

the petition have been found to be true and

correct.

2. Whether the establishment of the

district is inconsistent with any applicable

element of the effective local government

comp rehensive plan.

3. Whether the area of land within the

district is of sufficient size, is

sufficiently compact, and is sufficiently

contiguous to be developable as one

functional interrelated community.

4. Whether the district is the best

alternative available for delivering

community development services and

facilities to the area that will be served

by the district.

5. Whether the community development

services and facilities of the district will

be incompatible with the capacity and uses

of exis ting local and regional community

development services and facilities.

6. Whether the area that will be served by

the district is amenable to separate

special - district government.

63. The evidence was that, except for the possible

inaccuracy of the es timated construction costs in the SERC, the

statements in the Amended Petition, with its attached exhibits,

taken as a whole, would appear to be true and correct.

64. The evidence was that establishment by rule of the

District on the expanded property as proposed in the Petition

(and Amended Petition) is not inconsistent with the State and

Flagler County Comprehensive Plans.

65. The evidence was that the size, compactness, and

contiguity of the proposed land area are sufficient for the CDD,

as proposed to be amended, to be developable as one functional

interrelated community.

66. The evidence was that the CDD is the best alternative

presently available for delivering community development

systems, facilities, and services to the proposed land area.

67 . The evidence was that the services and facilities

provided by the CDD, as proposed to be amended, will be

compatible with the capacity and uses of existing local and

regional community development services and facilities.

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

CDD, as proposed to be amended, is amenable to separate special -

district government.

CONCLUSION

Based on the record evidence, the law, and the precedents,

there appears to be no reason not to grant the Amended Petition

and amend Ru le 42LL - 1.002 by adding the expansion parcel to the

Tomoka Community Development District, other than perhaps to

clarify the discrepancy between the estimated cost of

construction in the SERC and the other evidence in the record.

For purposes of drafting amended Rule 42LL - 1.002, the metes and

bounds description of the proposed amended Tomoka CDD found in

Hearing Exhibit C should be used.

DONE AND ENTERED this 10th day of May, 2006, in

Tallahassee, Leon County, Florida.

S

_________________________________ __

J. LAWRENCE JOHNSTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 10th day of May, 2006.

ENDNOTES

1 / Unless otherwise indicated, statutory citations are to the

2005 codification of the Florida Statutes.

2 / Unless otherwise indicated, rule citations are to th e current

codification of the Florida Administrative Code.

3 / The prolific use of exhibits in this proceeding can cause

confusion. To clarify, exhibits attached to the Petition will

be called Petition Exhibits, and exhibits introduced in evidence

at t he hearing will be called Hearing Exhibits.

COPIES FURNISHED :

Michael P. Hansen, Secretary

Florida Land and Water

Adjudicatory Commission

The Capitol, Room 2105

Tallahassee, Florida 32399 - 0001

Barbara Leighty, Clerk

Growth Management and Strategi c

Planning

The Capitol, Room 1802

Tallahassee, Florida 32399 - 0001

Raquel A. Rodriguez, General Counsel

Office of the Governor

The Capitol, Room 209

Tallahassee, Florida 32399 - 0001

Jonathan T. Johnson, Esquire

Wesley S. Haber, Esquire

Hopping Green & Sams, P.A.

123 South Calhoun Street

Post Office Box 6526

Tallahassee, Florida 32314

David L. Jordan, General Counsel

Department of Community Affairs

2555 Shumard Oak Boulevard, Room 325

Tallahassee, Florida 32399 - 2100