STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BROWARD COUNTY, FLORIDA, )

)

Petitioner, )

)

vs. ) CASE NO. 78-1210RP

) DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

FINAL ORDER

This action commenced upon the filing by the Petitioner, Broward County, Florida, of a "Petition to Determine the Invalidity of Proposed Rules" pursuant to Section 120.54(4) Florida Statutes, (1977). Petitioner is seeking a determination that proposed rules 14-61.01 and 14-61.03 of the Florida Department of Transportation (DOT) constitute an invalid exercise of delegated legislative authority. The case was assigned to the undersigned Hearing Officer by Order entered July 10, 1978. Upon stipulation of the parties the final hearing was conducted on August 14 and 15, 1978.

APPEARANCES

For Petitioner: Kenneth G. Oertel

Truett & Oertel Tallahassee, Florida

and Bairy Lessinger

Tallahassee, Florida

For Respondent: John J. Rimes

Tallahassee, Florida

The proposed rules would increase tolls charged by DOT on the Sunshine State Parkway. Petitioner contends that the rules are invalid because the Economic Impact Statement filed with the rules is not adequate; and because the rules are unreasonable. DOT contends that its Economic Impact Statement is adequate, and that the proposed rules are within its discretion.

FINDINGS OF FACT

1. DOT and its predecessors have been charged by statute with the responsibilities to construct, operate, and maintain the Florida Turnpike, which is known as the Sunshine State Parkway. The Parkway is financed through a system of tolls which DOT charges users, through concessions that DOT receives from service facilities that are located on the Parkway, and from interest that DOT receives on deposits of toll revenues. Tolls are the primary source of revenue. Proposed rules 14-61.01 and 14-61.03 would increase the tolls charged by DOT for all Parkway traffic.

2. The Petitioner is a political subdivision of the State of Florida. The Parkway traverses the north-south length of Broward County. Petitioner is a major user of the Parkway. Petitioner has the responsibility to operate and maintain a system of roadways within its boundaries. Changes in traffic patterns on the Parkway affect traffic patterns on other roads within the County. The parties have stipulated that the Petitioner would be substantially affected by the proposed rules.

   
   

3. The first section of the Parkway, between Miami and Ft. Pierce, was completed in 1956. The second section, between Ft. Pierce and Wildwood, was completed in 1963. The toll schedule, which sets the rates charged different classes of vehicles for different movements along the Parkway, has not been amended since it was originally adopted and implemented in connection with the opening of the various segments. The original toll schedule was determined based upon local costs of obtaining property and estimated maintenance costs.

   
   

4. The present toll structure includes some sharp fluctuations in the rate per mile charged for different movements. The average rate for the entire Parkway is approximately 1.8 cents per mile. For some movements along the Parkway the rate is as high as 4 cents per mile, while for others the rate is

   1.6 cents per mile. Different rates are charged for passenger cars, and for trucks. The rate differentials are based upon the number of axles. Thus a five axle heavy truck pays a rate that is 2.5 times the rate charged passenger cars.

   
   

5. During 1977, DOT began to consider a revision of the toll structure. Several legislators had expressed a desire that the toll rates be made uniform for all movements on the Parkway. Furthermore, the amount by which revenues obtained from operation of the Parkway exceed the cost of bond payments and operation and maintenance of the Parkway had been decreasing. It appeared at one time that there would be a shortfall of revenues for the 1977 year. There was also a projected shortfall of revenues for the 1978 year. The shortfalls did not occur. In fact there was a slight excess of revenues in 1977, and new projections based upon experience during the first six months of the year indicate that the same will be true for 1978. Excess revenues are, however, considerably less than had been typical in past years.

   
   

6. DOT has developed and proposed what it calls a "minimum capital program". The program is labeled "minimum" because it contemplates making expenditures only for items that are needed, and not for items that are merely desirable. Revenue needs have been estimated through the calendar year 1991. The minimum capital program includes payments that will need to be made on revenue bonds; and the cost of major resurfacings, periodic maintenance, updating communications and tolls equipment, safety improvements, rehabilitation or replacement of concessionaire facilities, improving traffic handling facilities and miscellaneous engineering expenses.

   
   

7. In addition to its own engineers, DOT employs two engineering firms to assist it in operating and maintaining the Parkway. A traffic engineer is employed to review the financial status of the Parkway on an annual basis, and a general engineer is employed to review the physical condition of the Parkway. Neither the traffic engineer nor the general engineer have mandated the minimum capital program. This program was developed by DOT's own employees

   
   

8. The traffic engineer's projections for revenues that will be obtained from operation of the Parkway through 1991 reveal that inadequate revenues would be raised to finance the minimum capital program. DOT thus employed its traffic engineer on a special project basis to propose a toll schedule that would raise

   sufficient revenues, and that would eliminate the large variations in rate per mile charged for different movements on the Parkway. The traffic engineer proposed several alternative toll schedules. DOT is seeking to adopt the most conservative schedule proposed by the traffic engineer, through proposed rules 14-61.01 and 14-61.03.

   
   

9. The traffic engineer sought to propose a schedule so that tolls for all movements on the Parkway would represent a fixed cost for collection of the toll, plus a fee based on usage in terms of mileage. It was decided that tolls would not be reduced for any movements, and that each movement would have an increase of at least five cents. There would be no toll increases greater than one hundred percent, and the smallest toll for any movement would be at least twenty cents. The tolls for all movements would be in five cent increments, so that change would not need to be distributed in pennies.

   
   

10. Overall the toll structure set out in the proposed rules represents approximately a twelve percent increase, with per-mile rates being made more uniform. The ratio of the tolls charged to different vehicles has remained almost constant. Heavy trucks with five axles will now pay tolls that are approximately 2.6 times that charged for passenger vehicles. This slight increase in ratio reflects nothing more than a desire to maintain tolls in five cent increments. It does not reflect any desire to change the increments charged for different types of vehicles.

    
    

11. Petitioner asserts that the minimum capital program is overstated, and that considerably less money will be needed for resurfacing and for safety improvements. DOT estimates that $110,000,000 will be needed for resurfacing on the Parkway between 1978 and 1991. This estimate is based upon a projection that resurfacing will be required every eight years, and will cost approximately

    $85,000 per mile to accomplish. The eight-year cycle is a planning tool utilized by DOT. It reflects the average life of pavement on interstate highways. The Parkway's history reflects that repavings are required less than every eight years. Portions of the first section of the Parkway did not need any resurfacing after the initial work for eleven years. With few exceptions, no new resurfacings were required after the first one, which was completed in 1968, until this year. Thus the first resurfacing has lasted from ten to fourteen years. Perhaps as a result of variances in materials, the experience on the second section of the turnpike has not been as good, but it does appear that a resurfacing will last for more than eight years. Despite this favorable history, there is room for considerable speculation on the part of engineers as to how long fly resurfacing will last. Eight years, while conservative, represents a fair estimate in view of the uncertainty.

    
    

12. It was estimated by a witness called by the Petitioner that a resurfacing can be accomplished for approximately $40,000 per mile rather than the $85,000 estimated by the Respondent. The witness who made this estimate has not been involved in any resurfacings of this magnitude since 1968. The major reason for his smaller estimate is that he would use considerably less asphalt than proposed by the Respondent. Here again, there is room for variance in the views of engineer. The amount proposed by the Respondent, while again on the liberal side, appears to be reasonable, and based upon current estimates of costs on actual projects, with inflation being considered.

    
    

13. As to safety improvements, Petitioner asserts that the improvements proposed by DOT are not essential. The minimum capital program includes proposals to add guard rails, to increase the strength of some existing guard rails, to improve lighting on the Parkway, and to increase the length of several

    approach lanes. The economic justification for the proposed safety improvements could be a subject for debate, but it does appear that the improvements offered by DOT are reasonable, and do not constitute as high an expenditure for safety as would be ideal.

    
    

14. Projected revenues under the present toll schedule would not be adequate to finance the minimum capital program. The total deficit would amount to either $40,000,000 or $73,000,000 depending upon the accounting method utilized. Under the proposed toll schedule an additional $91,700,000 would be raised over the amount that would be raised from the existing toll schedule according to the traffic engineer's projections. There would thus be at least a

    $20,000,000 estimated total excess of revenues under the proposed schedule. This $20,000,000 must be considered from the perspective that it represents a thirteen-year projection in a project which will have an aggregate budget of approximately $361,000,000.

    
    

15. Heavy trucks cause more wear on a highway surface than do passenger automobiles. The amount of increased wear is even greater than would be reflected by weight differentials. Trucks wear out a road surface at a rate of as much as twenty five times greater than automobiles. DOT made no effort to have the differential in tolls charged to trucks and automobiles reflect the amount of wear caused by each type of vehicle beyond the amount the present rate structure reflects such a differential. Neither did the Respondent make any effort to determine the extent to which toll increases could cause trucks to abandon the Parkway and to utilize other highways. The differential that exists in the present toll schedule was accepted by DOT and used for the purpose of developing a new schedule without any inquiry into whether a different ratio might better serve to raise revenue and to maintain the Parkway. The evidence does not reveal any logical basis for setting a ratio based upon that number of axles on the vehicle, but nonetheless DOT made no inquiry into the appropriateness of that ratio.

    
    

16. The Economic Impact Statement prepared in support of the proposed rules was developed in June, 1977. The Statement was completed prior to June 16, 1978, the date that the proposed rules were noticed in the Florida Administrative Weekly. The Economic Impact Statement was submitted into evidence at the hearing. It is organized along the lines of Section 120.54(2), Florida Statutes (1977), with numbered paragraphs in which the data required by the statute is putatively set out. Although there was testimony from a competent and qualified expert witness to the effect that the Economic Impact Statement does not meet professionally acceptable methodology, it has not been established that the Statement is other than adequate to meet the requirements of the statute. The Petitioner's expert testified primarily that the Statement does not include a recitation of the data upon which the conclusions set out in the Statement are based. The expert would have preferred that the proposed rule be quoted in the Statement, and that all figures utilized in the Statement be fully explained. The expert did not find any specific fault with she methodology of obtaining data, with the data itself, or with the conclusions.

    
    

    CONCLUSIONS OF LAW

    
    

17. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding and over the parties. Section 120.54(4), Florida Statutes (1977).

    
    

18. The Petitioner has the burden of establishing that the proposed rules constitute an invalid exercise of delegated legislative authority. The

    Petitioner has failed to establish that the Economic Impact Statement prepared by DOT is inadequate. Petitioner has contended that the Economic Impact Statement should conform to the requirements of a law which came into effect after the proposed rules were noticed. Chapter 78-425, Laws of Florida, Acts of 1978 (Senate Bill 860) modifies the substantive requirements for economic impact statements. It took effect on June 27, 1978. The parties have stipulated that DOT's Economic Impact Statement would not comport with the requirements of the new act. The contention that the new act governs the requirements for the Economic Impact Statement in this case is without merit. Under the law in effect prior to June 27, 1978, and under Chapter 78-425, an agency is required to prepare an economic impact statement prior to the adoption of a rule, and to have it available for inspection at the time that notice of the proposed rule is published. Sections 120.54(1),(2). The notice of the proposed rules sub judice was published prior to the effective date of Chapter 78-425. It is concluded that the law in effect at that time governs the substantive requirements for economic impact statements.

    
    

19. Petitioner has not established that DOT's Economic Impact, Statement fails to meet the requirements set out in Section 120.54(2) Florida Statutes (1977). The Petitioner's expert witness did not testify that the data was inadequate, or that the conclusions were erroneous. His objections to the Statement related to the fact that the data was not set out in the detailed manner that he would have preferred. Nothing in Section 120.54(2) requires that the data be set out in detail. The data was available for inspection by the Petitioner.

    
    

20. The Petitioner's expert also suggested that certain economic impacts were not considered. For example he suggested that some users of the turnpike might cease utilizing the facility due to the increased rate, might then lose employment and go on welfare. Nothing in the statutes requires an agency to consider such highly speculative impacts.

    
    

21. The legislature has delegated broad authority to operate the Sunshine State Parkway to DOT. Chapter 340, Florida Statutes (1977). The legislature has specifically delegated the authority to fix tolls which are calculated to raise revenue to maintain the Parkway, and to pay off bonded indebtedness. Section 340.12, Florida Statutes. While the delegation of authority is broad, it is not without limit. A statute which delegates rulemaking authority does not contemplate an unreasonable exercise of the authority conferred by the statute. Getzen v. Sumter County, 89 Fla. 145, 103 So. 104 (1925). The test of whether an agency has exceeded its delegation of authority in promulgating a regulation is whether the regulation is reasonably related to the purposes of the enabling legislation. Mourning v. Family Publications Service, Inc., 411

    U.S. 356, 369 (1973); Florida Citrus Commission v. Golden Gift, Inc., 91 So.2d 657 (Fla. 1956). Unreasonable, arbitrary or capricious regulations are not calculated to accomplish the purposes of enabling statutes. Robins v. Webb's Cut Rate Drug Co., 16 So.2d 121 (Fla. 1940). In Florida Beverage Corporation, Inc. v. Wynne, 306 So.2d 200, 202 (1 DCA Fla 1975) the court stated:

    
    

    It is well established in Florida that the legislature, having enacted a statute complete in itself which declares a legislative policy or standard and operates to limit the power delegated, may authorize an administrative agency to prescribe rules and regulations for its administration. It is equally well nettled that the legislature may expressly authorize

    designated public officials to provide rules and regulations for the complete operation and enforcement of a law or laws within their expressed general purposes. Such authority to make rules and regulations is not an impairment of the doctrine of non-delegation of powers...

    Where the empowering provision of a statute states simply that an agency may "make such rules and regulations as may be necessary to carry out the provisions of this act", the validity of regulations promulgated thereunder will be sustained so long

    as they are reasonably related to the purposes of the enabling legislation, and are not arbitrary or capricious... (Citations omitted).

    
    

22. Petitioner's contention that the proposed rules are unreasonable is in two parts. First, Petitioner contends that the rules are invalid because DOT does not need the increased revenue that it is seeking to raise. Petitioner has failed to establish that the proposed rules are unreasonable on this account. DOT has utilized a rather liberal estimate of funds that will be required for repaving of the turnpike. In other respects, however, DOT has estimated its needs conservatively. For example DOT's safety engineer would prefer that much larger expenditures be authorized for additional guard rails, lighting and extended access lanes. DOT has projected that it will, if its proposed toll increases are adopted, realize an excess of revenues over expenditures in the next thirteen years. The excess is not an unreasonable amount in view of the overall budget, and in view of uncertainty in calculations respecting use of the facility. Furthermore, any excess revenues that are realized can be utilized to pay off bond indebtedness in advance of due dates. This action could result in tolls being greatly reduced on the Parkway, to the benefit of the Petitioner, and all users.

    
    

23. The second aspect of the Petitioner's attack upon the reasonableness of the proposed rules relates to the proposed ratio of tolls between the different classes of vehicles on the turnpike. The testimony reveals that a large truck may weigh over twenty times as much as a passenger vehicle, and cause a deterioration in the roadway surface at even a greater ratio. Despite this fact, large trucks would, under the proposed rules, pay tolls that are only

    2.6 times greater than for passenger cars. The only basis that the Respondent has offered in support of this ratio is the fact that when tolls were first set for the Parkway twenty-two years ago it was decided to set a ratio based on the number of axles. No testimony was offered to establish that the number of axles on a vehicle bears any reasonable relationship to the toll that should be charged. There may be many reasons why trucks should be charged a toll which does not fully express the degree of deterioration of the roadway surface that they cause. For example, if the tolls for heavy trucks were raised to reflect this ratio, it may be that trucks would no longer use the Parkway, and that revenues would thus be drastically reduced perhaps to a level insufficient to meet bond obligations and maintain the Parkway. Furthermore, charging trucks at such a ratio might cause a diversion of truck traffic to other highways at a level which would be unacceptable to the safety of users of those highways. Whatever the merits of these contentions, they were not the reasons that the Department adopted the 2.6 to 1 ratio. Those reasons bear no rational relationship to any valid criteria for setting a ratio. The setting of a 2.6 to

    1 ratio was done without any inquiry into pertinent facts, and is thus

    arbitrary. Rules and regulations promulgated without any inquiry into pertinent facts are arbitrary, and invalid. State ex rel. Railroad Commissioners v.

    Florida East Coast Ry. Company, 64 Fla. 112, 59 So. 385 (1912).

    
    

24. DOT has contended that it is required under the terms of its trust indenture to follow the recommendations of its traffic engineer respecting tolls to be charged on the Parkway. In the instant case, the traffic engineer made its recommendations based upon facts and information that were provided by DOT. DOT did not request that the traffic engineer even consider the ratio of fees charged to trucks and cars. The traffic engineer made no inquiry as to whether the original ratio was rational, or whether a greater or lesser ratio would be appropriate. To hold that DOT is bound by the recommendations of the traffic engineer under these circumstances would be to hold that DOT has unlimited discretion to set rates, because it, in effect, solicited a toll schedule based upon criteria which it adopted.

    
    

25. Proposed rules 14-61.01 and 14-61.03 constitute an invalid exercise of delegated legislative authority.

FINAL ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby,

ORDERED:

The Respondent's proposed rules 14-61.01 and 16-61.03 constitute invalid exercises of delegated legislative authority.

DONE and ORDERED this 13 day of September, 1978, in Tallahassee, Florida.

G. STEVEN PFEIFFER Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675

COPIES FURNISHED:

Kenneth G. Oertel, Esquire Truett & Oertel, P. A.

646 Lewis State Bank Building Tallahassee, Florida 32301

Barry Lessinger, Esquire Room 248, County Courthouse

201 S. E. Sixth Street

Ft. Lauderdale, Florida 33301

John J. Rimes, Esquire Department of Transportation Haydon Burns Building Tallahassee, Florida 32304

Mr. Carroll Webb Executive Director

Administrative Procedure Committee Room 120 Holland Building Tallahassee, Florida 32304

Ms. Liz Cloud Department of State

Room 1802 Capitol Building Tallahassee, Florida 32304

APPENDIX STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BROWARD COUNTY, FLORIDA, )

)

Petitioner, )

)

vs. ) CASE NO. 78-1210RP

) DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

APPENDIX TO FINAL ORDER, RULINGS IN ACCORDANCE WITH SECTION 120.59(2) FLORIDA STATUTES

The parties have submitted post-hearing legal memoranda. In addition, the Petitioner has submitted Proposed Findings of Fact Rulings upon proposed findings of fact are set out herein in accordance with Section 120.59(2), Florida statutes (1977).

Petitioner's Proposed Findings of Fact numbered 5, 6, 8, 11, 12, 15, 16, 17, and 18 are supported by the evidence, and insofar as they are relevant are hereby adopted.

Paragraph 2 of the Petitioner's Proposed Findings is hereby rejected. The evidence is not conclusive as to how much money will be required for resurfacing of the Sunshine State Parkway during the next thirteen years. The Department's estimate is rather liberal, band the estimate offered by the Petitioner's expert engineering witness is rather conservative. There is room for variance in engineering opinions respecting these matters, and it cannot be concluded that the Respondent's estimates are unreasonable.

Petitioner's Proposed Findings 3, 4, and 10 are rejected. The evidence is inconclusive as to whether the Respondent will need to raise tolls in order to meet future expenses. It does appear that if the Respondent is to engage in its minimum capital program it will need to increase tolls. The minimum capital program appears reasonably calculated to further the goals of the Parkway.

Petitioner's Proposed Findings 13 and 14 are rejected. It has not been established that Respondent's Economic Impact Statement fails to meet the requirement of the Administrative Procedure Act. The Statement is not a paragon of clarity and precision, but it does discuss economic consequences of the propod rules, and, together with background data that is available, apprises the reader of the factual oasis for the proposed rules.

Petitioner's Proposed Finding Number 1 is hereby adopted, except that in addition to the need to raise tolls to meet projected expenses, the Respondent sought to equalize the rates mile that would be charged for various movements along the Parkway. If the words "the major" at the beginning of Petitioner's Proposed Finding Number 7 were changed to "a", then the proposed finding would be adopted. In addition to the shortfall of revenue for 1977, the Respondent was faced with future possibilities for shortfalls, and furthermore wanted to equalize rates. Paragraph 9 of the Petitioner's Proposed Findings cannot be accepted due to the use of the words "great haste". Clearly the Respondent did act quickly to prepare its minimum capital program, but it was based upon extensive work that had already been done.

Entered this 13 day of September, 1978, in Tallahassee, Florida.

G. STEVEN PFEIFFER Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675

COPIES FURNISHED:

Kenneth G. Oertel, Esquire Mr. Carroll Webb Truett & Oertel, P. A. Executive Director

646 Lewis State Bank Building Administrative Procedure Tallahassee, Florida 32301 Committee

Room 120 Holland Building Barry Lessinger, Esquire Tallahassee, Florida 32304 Room 248, County Courthouse

201 S. E. Sixth Street Ms. Liz Cloud

Ft. Lauderdale, Florida 33301 Department of State

Room 1802, Capitol Building

John J. Rimes, Esquire Tallahassee, Florida 32304 Department of Transportation

Haydon Burns Building Tallahassee, Florida 32304

Docket for Case No: 78-001210RP

Orders for Case No: 78-001210RP