17-004081 Southport Ranch, Llc vs. D.R. Horton, Inc., Osceola County, And South Florida Water Management District Status: Closed Recommended Order on Thursday, May 10, 2018.

Summary: Petitioner did not carry its burden of proving that Respondents were not entitled to the proposed amount of mitigation credits. Respondents carried their burden of showing entitlement to the requested mitigation bank permit.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

SOUTHPORT RANCH, LLC,

Petitioner,

vs. Case No. 17 - 4081

D.R. HORTON, INC., OSCEOLA

COUNTY, AND SOUTH FLORIDA WATER

MANAGEMENT DISTRICT,

Respondents.

_______________________________/

RECOMMENDED ORDER

Pursuant to notice, a final hearing was held in this case

on October 31 through November 2, 2017, in Orlando, Florida,

before Francine M. Ffolkes, a designated Administrative L aw

J udge of the Division of Administrative Hearings (DOAH) .

APPEARANCES

For Petitioner Southport Ranch, LLC:

Wayne E. Flowers, Esquire

John Wallace, Esquire

Lewis, Longman and Walker, P.A.

Suite 150

245 Riverside Avenue

J acksonville, Florida 32202 - 4931

For Respondent South Florida Water Management District:

Julia G. Lomonico, Esquire

Maricruz R. Fincher, Esquire

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406

For Respondent D.R. Horton, Inc.:

John J. Fumero, Esquire

Thomas Mullin, Esquire

Nason Yeager Gerson,

White & Lioce, P.A.

Suite 210

750 Park of Commerce Boulevard

Boca Raton, Florida 33487

For Respondent Osceola County:

Frank M. Townsend, Esquire

Shannon M arie Charles, Esquire

Osceola County Attorney's Office

Suite 4700

1 Courthouse Square

Kissimmee, Florida 34741

STATEMENT OF THE ISSUE S

The issues in this case are: 1) whether the Petitioner,

Southport Ranch, LLC (Petitioner) , is a substantially affected

person with standing to challenge the Respondent, South Florida

Water Management DistrictÓs (District) intent to issue

Environmental Resource Per mit (Mitigation Banking)

Number 49 - 00007 - M to the Respondents, D.R. Horton, Inc., and

Osceola County (Applicants); and 2) the number of potential

mitigation bank credits that the District should award to the

Applicants.

PRELIMINARY STATEMENT

On April 8, 2016, the Applicants submitted a r equest to

construct and operate a 747.91 - acre mitigation bank (Twin Oaks

Mitigation Bank) in Osceola County. The District announced its

intent to issue the Mitigation Banking Permit to the Applicants

on May 9, 2017. On May 31, the Petitioner and Gary Lee filed a

Petition for Administrative Hearing that the District dismissed

with leave to amend. The Petitioner subsequently filed an

Amended Petition (Gary Lee did not file an amended petition).

On July 18, the District referred to DOAH the Amended Petitio n

along with the Respondent, D.R. Horton, Inc.Ós Motion to Dismiss

and the PetitionerÓs Response in Opposition . The M otion to

Dismiss was denied by O rder dated July 25. On October 3, this

case was transferred to the undersigned.

The parties filed the Jo int Prehearing Stipulation on

October 23, in which the factual and legal issues were narrowed.

The Respondent, D.R. Horton, Inc. , filed its Amended Motion in

Limine in which the District joined. The undersigned denied the

motion without prejudice at the beginning of the final hearing.

At the final hearing, the parties offered Joint Exhibits 1

through 7, which were admitted into evidence. The Petitioner

presented the fact testimony of Gary Lee and Robert Mindick, and

the expert testimony of Beverly Bir kitt, Stuart Cullen, P.E.,

and Carl Salafrio. The PetitionerÓs Exhibits 1 through 9, 14,

17, 18, and 20 through 22 were admitted into evidence. The

Applicants presented the expert testimony of John Lesman and

Steven Boyd, P.E. The Respondent, D.R. Horto n, Inc.Ós ,

Exhibits 1 through 17 were admitted into evidence. The District

presented the expert testimony of Mark Daron, P.E., and Mark

Ady. The DistrictÓs Exhibits 1 through 5 were admitted into

evidence.

A five - volume Transcript of the hearing was file d with DOAH

on November 30, 2017. Proposed findings of fact and conclusions

of law were filed by the parties on January 12, 2018, and they

have been considered in the preparation of this Recommended

Order.

FINDING S OF FACT

The Parties

1. The District is a government entity created pursuant to

chapter 25270 of the 1949 Laws of Florida, and operates as a

multi - purpose water management district. The District has the

authority and duty to exercise regulatory jurisdiction over the

Twin Oaks Mitigation Bank ( the Project ) under the provisions of

p art IV, c hapter 373, Florida Statutes, and Titles 40E and 62 of

the Florida Administrative Code.

2. The Respondent, D.R. Horton, I nc. (D.R. Horton) , is a

Florida corporation and the owner of two of three parcels that

comprise the Pr oject. D.R. Horton is the largest homebuilder in

the Unites States with a large full - time staff in Florida and

around the country. The Respondent, Osceola County, is a

political subdivision of the State of Florida and the owner of

one of t hree parcels that comprise the Project.

3. The Petitioner, Southport Ranch, LLC, is a Florida

limited liability corporation that owns 7,000 acres of real

property located within the Lake Tohopekaliga (Lake Toho), Lake

Gentry, and Reedy Creek drainage basi ns in Osceola County.

PetitionerÓs Substantial Interests

4. The real property owned and managed by the Petitioner

is called Southport Ranch (Ranch). The Ranch straddles three

drainage basins , which are sub - basins within the Kissimmee River

Basin. A sma ll portion of the Ranch touches Lake Toho and the

eastern boundary of the Ranch extends to the centerline of the

C - 35 Canal. Water flows south from Lake Toho through the C - 35

Canal and into Ranch property through culverts.

5. Extensive wetland resources are located throughout the

Ranch, including forested, freshwater, and herbaceous wetlands.

The Ranch is populated by a wide array of aquatic and wetland

dependent animal species, including several species that are

listed as threatened or endangered by the state or federal

government.

6. The Petitioner is owned by a series of trusts

established by George Andrew Kelley (Kelley) who passed away in

2014. Kelley was a fourth - generation cattle rancher. Gary Lee

manages the Ranch operations and is also the tr ustee of the

George Andrew Kelley Family Trust. Mr. Lee testified that the

PetitionerÓs primary management objective, consistent with the

direction of Kelley prior to his death, is preservation and

conservation. This includes preserving and protecting ex isting

wetland habitat on the Ranch.

7. Historically, the primary land use on the Ranch was

cattle ranching and that activity continues on a portion of the

Ranch property. The other land use is the Southport Ranch

Mitigation Bank (SRMB), a wetland mitiga tion bank permitted by

the District in 2010. The SRMB is operated by a separate

company in partnership with the Petitioner, and they are co -

permittees on the mitigation bank permit.

8. Mr. Lee testified to certain concerns with the Project

and the numb er of proposed mitigation credits. Mainly that, if

the Project does not achieve success as a mitigation bank, it

could be detrimental to existing wetlands, such as those on the

Ranch, which support aquatic and avian species. In addition,

there could be a dverse regional impact in the form of a net loss

of wetlands. Mr. Lee considers the Ranch to be a Ðvery[,]

very[,] very unique piece of propertyÑ and ÐweÓre trying to save

it.Ñ

9. The PetitionerÓs expert, Carl Salafrio, testified that

utilization of a mi tigation credit or credits that do not

completely offset the loss of wetland function caused by a

permitted wetland impact within the Kissimmee River watershed or

the three sub - basins in which the Ranch property is located,

would adversely impact aquatic a nd wetland species present on

the Ranch.

The Project and V icinity

10. The Applicants propose to construct and operate the

Project along the northeast side of Lake Toho in Osceola County.

The Project consists of three mitigation areas (MA) with a total

of 747.91 acres. MA1 is the northern parcel and comprises

202.94 acres that are currently drained by an off - site pump that

pushes water to the west into Lake Toho. MA1 is bounded on the

north by the Partin Canal, to the west by Kings Highway , and to

the ea st by Neptune Road. D.R. Horton owns MA1. An existing

conservation easement (CE) encompasses 45.26 acres of MA1. The

CE is associated with the prior issuance of an Environmental

Resource Permit (ERP) for Phase 1A of a residential development

known as th e Toho Preserve (now known as Kindred).

11. MA2 is south of MA1 and the southwestern region of MA2

abuts the northeastern shore of Lake Toho. MA2 is bounded to

the east by Macy Island Road. MA2 comprises 283.82 acres that

are currently drained to the s outh by a pump into Lake Toho.

MA2 is owned by D.R. Horton.

12. MA3 is east of MA2 and comprises 261.15 acres that

drain through a culvert under Macy Island Road into MA2 and

south into Lake Toho. MA3 is owned by Osceola County and the

County will b e the sole user of the mitigation credits generated

by MA3. MA3 is bounded on the east by the C - 31 canal and to the

south by a park owned by Osceola County.

13. The service area for the mitigation bank consists of

the Lake Toho, Reedy Creek, Lake Gentry , Lake Hart, Shingle

Creek, Boggy Creek, Lake Hatchineha, and Lake Kissimmee drainage

basins within the jurisdiction of the District. The service

area also includes portions of the Southern St. Johns River

basin, which is within the jurisdictional boundar y of the

Southwest Florida Water Management District, and additional

areas within the boundaries of the St. Johns River Water

Management District.

14. The Project site was historically littoral areas of

Lake Toho that were separated from the Lake by dra inage

modifications , such as those made in the 1950s by the Central

and South Florida Flood Control Project. The drainage

modifications included features , such as the C - 31 Canal, the

Partin Canal, dikes, ditches, pumps, culverts and roads. In

particular, the large agricultural pumps at MA1 and MA2 drain

the mitigation areas and pushes water into Lake Toho to maintain

the acreages as pasture for cattle grazing.

15. The Applicants propose to construct the Project

through a combination of wetland restoratio n, wetland and upland

enhancement, conservation easements, and implementation of

hydrologic improvements. The Project will increase hydroperiods

in targeted wetlands to mimic the historic hydrologic regime and

restore natural sheet flow patterns that exis ted prior to the

drainage modifications. Rainfall and runoff from adjacent

developments will serve to hydrate the three mitigation areas.

Successful restoration of the natural hydroperiods will promote

the growth and maintenance of desired wetland vegeta tion

communities in the mitigation bank.

16. D.R. Horton will manage and operate the Project until

it meets the success criteria documented in the permit. Once

the Project achieves success, Osceola County will operate and

maintain the Project in perpet uity. Osceola County has

implemented an Environmental Land Conservation program (SAVE

Ordinance ) designed to acquire and manage, in perpetuity,

conservation lands.

Proposed Enhancement and Restoration

17. The Project would restore the upland and wetla nd

habitats historically a part of, and hydrologically connected

to, Lake Toho. The mitigation activities will consist of

various methods for the targeted community types. These include

hydrologic enhancement and restoration, regrading wetland areas

and ditches to match natural grades, prescriptive burning,

elimination of nuisance and exotic plant species, and vegetation

enhancement and restoration. The Project would eliminate

incompatible land uses within the mitigation areas, such as

cattle grazing, ha y production, and sod farming.

18. The Project w ould reestablish wetland community

structures and functions similar to the natural, historic

wetland communities within the mitigation service area. The

target community types and required hydrologic enhanc ement were

also identified by the Applic antsÓ expert, John Lesman.

Mr. Lesman testified that he consulted resources , such as

Ecosystems of Florida and the Florida Natural Areas Inventory.

For example, portions of the upland pasture areas w ould be

restore d to slough marsh and wet prairie communities by

increasing the elevation and duration of seasonal high water

levels .

19. Planting is proposed in upland enhancement areas

because of a lack of viable seed source for natural recruitment

of native upland spe cies. For the wetland enhancement and

restoration areas, existing wetland vegetation is a viable seed

source to facilitate natural recruitment. Mr. Lesman testified

that natural recruitment is a generally - accepted means to

establish wetland plant species . The PetitionerÓs expert,

Beverly Birkitt, questioned whether more plantings should be

required. However, if natural recruitment is not successful,

the Applicants would conduct supplemental plantings in order to

meet vegetation success criteria.

20. Th e Project would utilize herbicidal and mechanical

control of nuisance and exotic vegetation consistent with the

Nuisance and Exotic Vegetation Control Plan. Prescribed burns

are also used to control exotic and nuisance species in

pyrogenic communities wit hin mitigation banks.

21. Ms. Birkitt opined that prescribed burns should not

occur adjacent to existing and proposed residential development.

However, prescribed burns are a common activity carried out by

licensed professionals using methods establishe d and approved by

the Florida Forest Service. The Prescribed Burning Management

Plan requires safeguards when there is a wildland - urban

interface. Safeguards include permanent fire lines, educational

outreach to adjacent residential communities, and loca l

partnerships with local fire rescue agencies, the Florida Forest

Service, and Osceola County staff.

22. The ProjectÓs mitigation activities w ould restore

habitats for listed species, aquatic - dependent and wetland -

dependent species, and a variety of oth er wildlife. Lake Toho

and surrounding areas serve as a primary foraging and nesting

refuge for the everglades snail kite. It is also habitat for

various endangered and threatened species, such as the whooping

crane, limpkin, snowy egret, white ibis, lit tle blue heron,

tricolored heron, and bald eagle.

23. The Applicants modified the application to include a

25 - foot buffer along specified portions of the perimeter areas

of MA1, MA2 and MA3. Those specified portions have adjacent

development or the pot ential for adjacent development, which is

a risk for all mitigation banks. The Applicants also removed

the acreage within the 25 - foot buffer areas from consideration

to generate mitigation credits. However, that acreage would

still be enhanced or restore d as part of the ProjectÓs

mitigation activities. A 25 - foot buffer is not proposed for

those areas that have existing physical buffers or legal

restrictions that preclude future development.

Proposed Hydrologic Improvements

24. The Project encompasses numerous activities designed

to restore hydrologic conditions at the mitigation areas

including removal of certain drainage features and structures.

Surface water from MA1 will flow through a broad crested weir, a

series of pipes and a drop inlet with op erable boards to the

Partin Canal, which is directly connected to Lake Toho. The

existing culvert under Kings Highway that currently allows MA1

to drain to the off - site pump would be plugged with concrete to

allow hydroperiod restoration. The pump at the south end of MA2

that currently drains MA2 and MA3 would be removed and replaced

with a broad crested weir, a series of pipes and a drop inlet

with operable boards that will outfall to Lake Toho. The boards

are light - weight aluminum and are easily instal led or removed by

a single individual. The weir structure w ould detain water in

MA2 and MA3 causing re - hydration of these historic wetland

systems. The installations of the control structures within MA1

and MA2 w ould reestablish the hydrologic connection s between

Lake Toho and MA1, MA2 and MA3.

25. To properly assess and implement the hydrologic

improvements, the Applicants developed a hydrologic model. The

primary factors considered in order to model the proposed

condition annual hydrograph were annua l rainfall and evaporation

from the water body areas. Sixteen years of average annual data

for both rainfall and evaporation were obtained from the

University of Florida Î Institute of Food and Animal Sciences

Department, Lake Alfred Experiment Station. The rainfall data

was averaged to develop average daily rainfall totals for a

hypothetical year. This rainfall data was entered into the

Advanced ICPR model for generation of annual runoff hydrographs

entering each of the on - site wetlands. Advanced ICPR is an

industry standard model for stormwater management systems in

large basins, routinely accepted by the District for permit

applications.

26. The water levels of Lake Toho are managed on a lake

regulation schedule operated by the District. Lake Toho w ater

levels influence hydrology in and around the Project site. The

water levels of Lake Toho were factored into the ApplicantsÓ

hydrologic model. The Applicants used a 10 - year average of

water levels within Lake Toho. Surface water elevation data for

L ake Toho was obtained from data provided by the District for

the years 2001 through 20 11 . For the purpose of modeling the

average annual conditions, the annual data was averaged with the

2004 data being excluded. The PetitionerÓs expert engineer,

Stuart Cullen, opined that the Lake Toho regulation schedule

should have been considered instead of actual water levels.

However, the evidence showed that the water levels frequently

varied from the regulation schedule. Thus, the use of actual

water levels with in Lake Toho for modeling purposes yielded more

accurate results.

27. The ApplicantsÓ model demonstrated post - development

results using data for the existing conditions of the Project

site . Mr. Cullen opined that the existing conditions used for

this per mit application should have been the Ðpumps offÑ

scenario provided in the Conceptual ERP for the Kindred project

because the District referenced the Kindred Conceptual ERP in

the permit documents for this Project. However, Mr. Boyd, who

was the engineer f or the Kindred Conceptual ERP, testified that

it included a pumps - off scenario only to show that even if the

pumps failed, the Kindred development would not flood. This is

a Ðworst case scenarioÑ demonstration and is different than

existing conditions, wh ich are the conditions as they exist on

the site today, not how they are permitted to exist in the

future. Mr. Boyd explained that he listed the Ðpumps onÑ

scenario as the existing condition because the off - site pump,

which is not controlled by the Applic ants, currently runs as

needed to keep the property drained and completely dry. When

the Applicants block the culvert connected to the off - site pump

as part of the ProjectÓs proposed activities, the pump will no

longer affect the property. This is the Ðp umps offÑ scenario,

which in this instance, only occurs post - development.

28. Hydrologic modeling data and results demonstrated that

wa ter levels within the Project would mimic a traditional wet

season/dry season fluctuation as opposed to the inverse

hyd roperiod of Lake Toho. The operable water control structures

w ould be modified on a seasonal basis. In the dry season, the

boards w ould be removed to lower the water levels, mimicking

natural dry season water levels. Conversely, the boards w ould

be in p lace during the wet season to raise the water levels in

the wetlands, thereby creating natural wet season water levels.

The model demons trates that the system design would immediately

provide the hydrologic enhancement necessary to meet the

ApplicantsÓ ec ological goals.

Uniform Mitigation Assessment Method

29. The Uniform Mitigation Assessment Method (UMAM)

provides a standardized wetland assessment methodology that may

be applied across community types. UMAM is used to calculate

the credits that may be awarded to a mitigation bank.

30. UMAM involves a two - part analysis. Part I is a

qualitative characterization of the property by assessment

areas. An assessment area is all or part of a mitigation site

that is sufficiently homogeneous in character o r mitigation

benefits to be assessed as a single unit. See Fla. Admin. Code

R. 62 - 345.200(1). Part II utilizes the scoring criteria

established under the rules to evaluate each assessment areaÓs

ÐcurrentÑ condition (prior to the mitigation) to its Ðwith

mitigationÑ condition. The resulting difference represents the

improvement of ecological value or the ecological lift, referred

to in the r ule as the Ðdelta.Ñ See Fla. Admin. Code R. 62 -

345.500.

31. Ms. Birkitt agreed with almost all the ApplicantsÓ

Ðcu rrentÑ condition scores and also with all of the ApplicantsÓ

Ðwith mitigationÑ condition scores related to upland

enhancement. Ms. Birkitt focused on the Ðwith mitigationÑ

scores for wetland enhancemen t and wetland restoration.

Ms. Birkitt testified that the ecological lift reflected by the

UMAM numbers for the three wetland function indicators could not

be achieved. The major reason given by Ms. Birkitt was the

ApplicantsÓ inability to achieve the necessary wet season water

levels in the mitigation area s. Other reasons included the

potential for development adjacent to the mitigation areas, the

limited benefit attributed to prescribed burns, and the lack of

planting in certain assessment areas.

32. Part II scoring under the UMAM rule has three

categori es of indicators of wetland function: location and

landscape support, water environment, and community structure.

For location and landscape support, the value of functions

provided by mitigation assessment areas are influenced by the

landscape position o f the assessment area, its relationship with

adjacent and regional surrounding areas, including

interconnectivity that benefits wildlife. For water

environment, the quantity of water in an assessment area,

including the timing, frequency, depth and durati on of the

inundation or saturation, and flow characteristics are

considered. Hydrologic requirements and hydrologic alterations

are evaluated to determine the effect of these conditions on the

functions performed by the assessment area. For community

str ucture, each mitigation assessment area is evaluated with

regard to its characteristic community structure, including

vegetation and habitat. By way of example, a score of 10 means

the mitigation assessment area, based on reasonable scientific

judgment, i s capable of reaching 100 percent of beneficial

ecological functions. A score of 5 means, that the assessment

area is limited in its ability to perform beneficial ecological

functions to 50 percent of the optimal value. See Fla. Admin.

Code R. 62 - 345.500 .

33. The PetitionerÓs experts identified the main

hydrologic issue as the ApplicantsÓ inability to achieve the

necessary wet season water levels in the mitigation areas. As

discussed above, the Applicants demonstrated that the system

design supports the hydrologic environment necessary to provide

functional gains consistent with the UMAM scoring.

34. The potential for development w ould not decrease the

value of functions gained by the enhancement and restoration

activities. The 25 - foot buffer around the mitigation areas adds

an additional layer of protection and any future developments

must address potential impacts to the Project before obtaining a

construction permit.

35. The important role of prescribed burns in mitigation

banks is addressed above . Any necessary supplemental plantings

w ould be carried out by the Applicants in accordance with the

vegetation success criteria.

36. Ms. Birkitt also testified that the ApplicantsÓ Ðwith

mitigationÑ condition score for approximately 45 acres in MA1 is

not appropriate due to the existing conservation easement and

its requirements. As e xplained below, the Applicants took this

into account in the ÐcurrentÑ condition score (i.e. Ðwithout

mitigation). In addition, the Project will provide hydrologic

enhan cement that is not currently provided through the

conservation easement. The ProjectÓs success criteria require a

lower percentage of nuisance and exotic vegetation, which

increases plant cover of appropriate and desirable species.

Also, the Applicants w ill provide prescribed fire and wildlife

management for all communities.

Time Lag and Risk

37. The time lag associated with mitigation is the period

of time between when the functions are lost at an impact site

and when the site has achieved the outcome scored in Part II of

UMAM. See Fla. Admin. Code R. 62 - 345.600. There is no time lag

if the mitigation fully offsets the anticipated impacts prior to

or at the time of the impacts. A score of one is appropriate

for activity - based releases that will occur in less than one

year.

38. Ms. Birkitt testified that the Applicants should have

applied a time lag score greater than one to the initial and

activity - based releases because these activities do not provide

a functional gain and, therefore, the credits r eleased will not

actually offset any impacts. However, the applicable rule

applies a time lag score of one (T - factor of 1) to activities

that reach success within one year. The evidence shows that the

initial and activity - based releases will occur in les s than one

year.

39. Any amount of risk above de minimus reduces the

ecological value of the mitigation assessment area. A score of

one would most often be applied to mitigation conducted in an

ecologically viable landscape and deemed successful or clea rly

trending towards success prior to impacts. Ms. Birkitt admitted

that placing the Project site under a conservation easement and

installing the hydrologic improvements should benefit the

ProjectÓs hydrology, but opined that no benefit would actually

oc cur. As discussed above, the hydrologic improvements are

designed to provide an instantaneous and clear trend towards

success.

Mitigation Credits

40. The Mitigation Bank Permit proposes to authorize

388.13 wetland mitigation credits. D.R. Horton w ould r eceive

99.56 credits for MA1 and 150.92 credits for MA2. Osceola

County w ould receive 137.65 credits for MA3.

41. The Applicants evaluated the quality of the wetlands

by performing the functional assessment of the Project site in

the ÐcurrentÑ condition and then the functional assessment of

the Project site in the Ðwith mitigationÑ condition. This

evaluation method yielded the quality of the restoration and

enhancement. The Applicants further evaluated the resulting

quality against the total acreage fo r the Project. In total,

the Applicants propose restoring 183.18 acres of wetlands and

enhancing 542.52 acres of wetlands and associated uplands. It

is ÐexceptionalÑ and ÐuniqueÑ to have so much wetland

restoration in a mitigation bank project.

42. The Applicants recognized that the District previously

issued a permit requiring a conservation easement on

approximately 45 acres in MA1. The proposed success criteria

from that preservation were taken into account in the ÐcurrentÑ

condition score for that assessment area. Osceola County

acquired MA3 with funds through the land conservation program

established by its SAVE Ordinance. The SAVE Ordinance places

minor limits on the area. According to Osceola CountyÓs Parks

and Public Lands Director, Robert Mi ndick, the CountyÓs

management plans and the CountyÓs SAVE Ordinance do not create

the same land restrictions as a conversation easement.

Nonetheless, the Applicants effectively treated the SAVE

Ordinance as a conservation easement when assessing the UMAM

scores for MA3. This was a more conservative approach.

Credit Releases

43. The Project w ould receive a 20 percent credit release

upon recordation of conservation easements and providing the

financial assurances required by the Permit. This initial

rel ease is a generally accepted practice, is considered a

reasonable approach and w ould occur in less than one year.

44. The Project w ould receive a 15 percent credit release

based on successful construction and implementation of the

hydrologic improvements. This activity - based release is

generally accepted, is considered a reasonable approach, and

w ould occur in less than one year.

45. The remainder of the mitigation credits w ould only be

released upon the Project attaining full success. The Project

is st ructured so that 65 percent of its credits cannot be

released until attaining full success. This structure is

atypical, but puts the burden on the Applicants to perform in

order to realize 65 percent of its credits. The Credit Release

Schedule is reasona ble and consistent with applicable rule

criteria.

46. Mitigation credits generated by MA3 may only be used

by Osceola County in conformance with the limitations imposed by

section 373.414, Florida Statutes. The ledger for mitigation

credits will differe ntiate between MA1 and MA2 and MA3.

AttorneyÓs Fees

47. The Petitioner did not participate in this proceeding

for an improper purpose as defined in section 120.595(1) ,

Florida Statutes . As found in paragraphs 6 and 8 above, the

PetitionerÓs concerns wer e not purely economic as alleged by

D.R. Horton.

48. The PetitionerÓs pleadings, starting with its Petition

and Amended Petition, were not interposed for an improper

purpose as defined in section 120.569(2)(e). Mere co - ownership

of SRMB by the Petitione r does not overcome the findings in

paragraphs 6, 8 and 9 above , and does not prove an improper or

frivolous purpose. The preponderance of the evidence showed

that the Petition and Amended Petition were filed to advance

legitimate environmental concerns.

49. The PetitionerÓs Amended Petition was not interposed

for a frivolous purpose as defined in section 57.105 , Florida

Statutes . Mere co - ownership of SRMB by the Petitioner does not

overcome the findings in paragraphs 4 through 9 above and does

not prov e that the pleading was frivolous. The preponderance of

the evidence showed that the Petition and Amended Petition were

filed to advance legitimate environmental concerns.

Ultimate Findings

50. The Applicants presented a prima facie case

demonstrating co mpliance with all applicable permitting criteria

for the Mitigation Banking Permit.

51. The Petitioner did not prove its case in opposition by

a preponderance of the competent substantial evidence.

52. However, the Petitioner did not participate in t his

proceeding for an improper or frivolous purpose.

CONCLUSIONS OF LAW

Standing

53. The Petitioner presented competent evidence to show it

has substantial interests that could reasonably be affected by

the proposed Mitigation Bank Permit. Therefore, th e Petitioner

has standing to challenge its proposed issuance. See St. Johns

Riverkeeper, Inc. v. St. Johns River Water Mgmt. Dist. , 54 So.

3d 1051, 1054 (Fla. 5th DCA 2011); Palm Beach Cnty. Envtl.

Coalition v. DepÓt of Envtl. Prot. , 14 So. 3d 1076, 1078 (Fla.

4th DCA 2009).

Burden of Proof

54 . The Petitioner challenged issuance of a mitigation

bank permit issued under chapter 373. Therefore, section

120.569(2)(p) is applicable. Under this provision, the permit

applicant must present a prima facie case demonstrating

entitlement to the permit. Thereafter, a third party

challenging the issuance of the permit has the burden "of

ultimate persuasion" and the burden "of going forward to prove

the case in opposition to the . . . permit." If the third party

f ails to carry its burden, the applicant prevails by virtue of

its prima facie case.

Permitting Standard

55. Issuance of the permit is dependent upon there being

reasonable assurance that the mitigation bank will meet

applicable statutory and regulatory standards. See

§ 373.4136(1), Fla. Stat.

56. Reasonable assurance means "a substantial likelihood

that the project will be successfully implemented." See Metro.

Dade Cnty. v. Coscan Fla., Inc. , 609 So. 2d 644, 648 (Fla. 3d

DCA 1992). Reasonable assura nce does not require absolute

guarantees that the applicable conditions for issuance of a

permit have been satisfied.

57. The Applicant s presented a prima facie case of

entitlement to the permit. Therefore, the burden of ultimate

persuasion is on the Pet itioner to prove its case in opposition

to the permit by a preponderance of the compe tent and

substantial evidence. Having failed to do so, the Applicants

must prevail.

58. The Applicants provided reasonable assurance that all

relevant criteria in Florid a Administrative Code C hapters 62 -

330, 62 - 342, and 62 - 345, for the issuance of an environmental

resource permit and establishment of a mitigation bank were

satisfied.

AttorneyÓs Fees

59. The Petitioner did not participate in this proceeding

for impro per or frivolous purposes or file frivolous pleadings

as defined in sections 120.595(1), 120.569(2)(e), and 57.105(1).

See Friends of Nassau Cnty. v. Nassau Cnty. , 752 So. 2d 42, 50

(Fla. 1st DCA 2000)(ÐWe have never held that opposing issuance

of a permi t . . . is improper simply because economic

considerations contribute to a partyÓs decision to act.Ñ). Mere

co - ownership of SRMB by the Petitioner does not prove that the

Petition and Amended Petition were not filed to advance

legitimate environmental con cerns. See Mercedes Lighting &

Elec. Supply v. State , 560 So. 2d 272, 279 (Fla. 1st DCA

1990)(ÐThe hearing officer was presented with competent and

substantial evidence on both sides of the issue, and with

competent and thorough legal briefing by counsel. That the

hearing officer chose to adopt [RespondentsÓ] position over

[PetitionerÓs] should not be the basis for [sanctions]Ñ).

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is:

RECOMMENDED that the South Florida Water Management

District enter a final order approving the issuance of

Mitigation Bank Permit Number 49 - 00007 - M, as modified, subject

to the conditions set forth in the Staff Report; and

ORDERED that D.R. HortonÓs request for reasonable

attorneyÓs fees and cost s under sections 57.105, 120.595, and

120.569, Florida Statutes, is denied.

DONE AND ENTERED this 10th day of May , 2018 , in

Tallahassee, Leon County, Florida.

S

FRANCINE M. FFOLKES

Administrative Law Judge

Division of Adm inistrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 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 , 2018 .

C OPIES FURNISHED:

Susan Roeder Martin, Esquire

South Florida Water Management District

Mail Stop Code 1410

3301 Gun Club Road

West Palm Beach, Florida 33406

(eServed)

Wayne E. Flowers, Esquire

Lewis, Longman & Walker, P.A.

Suite 150

245 Riverside Avenue

Jacksonville, Florida 32256

(eServed)

Frank M. Townsend, Esquire

Osceola County Attorney's Office

Suite 4700

1 Courthouse Square

Kissimmee, Florida 34741

(eServed)

Shannon Marie Charles, Esquire

Osceola County Attorney's Office

1 Courthouse Square

Ki ssimmee, Florida 34741

(eServed)

Julia G. Lomonico, Esquire

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406

(eServed)

Maricruz R. Fincher, Esquire

South Florida Water Management District

Mail Stop Code 1410

330 1 Gun Club Road

West Palm Beach, Florida 33406

(eServed)

Bridgette Nicole Thornton, Esquire

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406

(eServed)

John W. Bizanes, Esquire

Nason, Yeager, Gerson, White

& Li oce, P.A.

Suite 210

750 Park of Commerce Boulevard

Boca Raton, Florida 33487

(eServed)

John J. Fumero, Esquire

Nason Yeager Gerson White & Lioce, P.A.

750 Park of Commerce Boulevard, Suite 210

Boca Raton, Florida 33487

(eServed)

Thomas F. Mullin, Esqu ire

Nason Yeager Gerson White & Lioce, P.A.

Suite 210

750 Park of Commerce Boulevard

Boca Raton, Florida 33487

(eServed)

Ernest Marks, Executive Director

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406 - 3007

(eS erved)

Brian Accardo, General Counsel

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406 - 3007

(eServed)

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.