STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

GAP CREEK HOMEOWNERS ASSOCIATION, )

)

Petitioner, )

)

vs. ) CASE NO. 80-996

) STATE OF FLORIDA, DEPARTMENT OF ) ENVIRONMENTAL REGULATION and ) OKALOOSA COUNTY BOARD OF COUNTY ) COMMISSIONERS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Sharyn L. Smith, held a hearing in this cause on December 11, 1980, in Shalimar, Okaloosa County, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: Bruce C. Babbitt, Esquire

Post Office Box 1628

Fort Walton Beach, Florida 32549

For Respondent: John R. Dowd, Esquire (Okaloosa County) Post Office Box 1964

Fort Walton Beach, Florida 32548

For Respondent: Paul R. Ezatoff, Jr., Esquire (DER) Assistant General Counsel

2600 Blair Stone Road Tallahassee, Florida 32301

The issue to be decided in this case is whether the applicant, Okaloosa County, is entitled to an exemption from storm water licensing requirements for the installation of a 48" storm water pipe to replace an existing smaller pipe that empties into Gap Greek.

Proposed Recommended Orders have been submitted by the parties and considered by the Hearing Officer. Those proposed findings not included in this Recommended Order were not considered relevant to the issues, were not supported by competent and substantial evidence, or were considered immaterial to the results reached.

PRELIMINARY STATEMENT

On April 25, 1980, the Department of Environmental Regulation (hereafter "Department") issued a letter of intent to approve a permit for the enlargement

of an existing storm water discharge system to Sun Plaza Shopping Mall (hereafter "Sun Plaza") in Fort Walton Beach, Florida. On May 6, 1980, the Department issued a letter of intent to exempt from storm water licensing the replacement by Okaloosa County of an existing storm water pipe with a larger 48" diameter pipe which discharges storm water into Gap Creek in Fort Walton Beach, Florida. The replacement was necessitated by the added run off anticipated from the Sun Plaza development. The system proposed by Sun Plaza would discharge any excess storm water via a concrete ditch to the County's proposed 48" pipe which would then discharge into Gap Creek. By letters dated May 3, 1980 and May 22, 1980, the Gap Creek Homeowners Association (hereafter "Association") objected to the Department's intended action regarding the enlargement of the storm water discharge system and replacement of the drainage pipe and petitioned for a formal administrative hearing on the issues. The Association requested that the pending cases, Gap Creek Homeowners Association v. State of Florida, Department of Environmental Regulation and Nathan A. Kahn, Case No. 80-971 (dealing with the enlargement of discharge system by Sun Plaza) and Gap Creek Homeowners Association v. State of Florida, Department of Environmental Regulation and Okaloosa County Board of County Commissioners, Case No. 80-996 (involving the replacement of the existing drainage pipe) filed with the Division of Administrative Hearings, be consolidated for hearing. The Department concurred in this request and stated that the parties and issues involved were sufficiently similar to warrant consolidation.

On June 19, 1980, Nathan A. Kahn, a partner in Sun Plaza, filed a Motion to Dismiss the petition filed by the Association in Case No. 80-971, Gap Creek Homeowners Association v. State of Florida, Department of Environmental Regulation and Nathan A. Kahn. The basis for the Motion was that Respondent Kahn was exempt from Rule 17-4.248, Florida Administrative Code, permitting requirements due to his membership in the International Council of Shopping Centers. Respondent Kahn asserted that since he was exempt from storm water discharge permitting requirements, the Department lacked subject matter jurisdiction in Case No. 80-971. The Association filed a Response in Opposition to the Motion and a hearing on the Motion to Dismiss was held on July 11, 1980 in Tallahassee, Florida. At the hearing, the Department joined in the Respondent's Motion to Dismiss, asserting a lack of subject matter jurisdiction over the storm water runoff of Sun Plaza.

The basis for the Respondents' assertion of a lack of subject matter jurisdiction over the storm water discharge of Respondent Kahn was a stipulation between the Department and the International Council of Shopping Centers in a prior administrative proceeding which challenged the validity of Rule 17-4.248, Florida Administrative Code. The stipulation which was entered in Blairstone Plaza, Ltd. v. Department of Environmental Regulation, Case No. 79-2005R, limited the scope of Rule 17-4.248, Florida Administrative Code, to installations which:

2.a. Are located contiguous to waters of the state, or

1. Directly discharge into waters of the state or a canal or a privately owned or maintained discrete conveyance not

   otherwise exempt which directly discharges into waters of the state, or

2. Are non-contiguous upland installations or more than 25 acres (25) acres of impervious surface, except for non- contiguous upland installations which

have received a storm water permit from the South Florida Water Management District or any other water management district which later adopts such a permit system.

By its terms, the stipulation and the above conditions apply only to the parties to the proceeding, the International Council of Shopping Centers, its members and the Department, and the existing Rule 17-4.248, in effect as of March 3, 1980.

At the motion hearing, the parties agreed that the stipulation limited or modified the application of Rule 17-4.248, Florida Administrative Code, the storm water discharge rule, as to members of the International Council of Shopping Centers. The Petitioner, however, asserted that the modification of an existing rule through stipulation constituted rule-making without authority and the stipulation should not be enforced against individuals who were not parties to the stipulation and, therefore, had no notice of its effect. The Respondent, in turn, argued that the Petitioner was attempting to collaterally attack the settlement entered into in good faith between the Respondent and the Department. 1/

At the motion hearing, sworn testimony was received concerning the physical characteristics of the project which demonstrated a factual basis for asserting the applicability of the stipulation to Sun Plaza. Argument was also heard regarding the legal effect of the stipulation on the pending proceeding. On July 21, 1980, the Hearing Officer entered an Order denying the Respondent's Motion to Dismiss for lack of subject matter jurisdiction and found the stipulation not binding on third persons who were not parties to the original proceeding. 2/ On July 24, 1980, counsel for Respondent Kahn withdrew his application for a permit for modification of a storm water discharge system. On August 3, 1980, the application was withdrawn and the project exempt by the Department's District Manager based upon the terms of the stipulation. 3/ By letter dated August 11, 1980, counsel for Respondent Kahn informed opposing counsel that the petition was moot since no permit application was pending. On August 24, 1980, an order was entered by the Hearing Officer dismissing the proceeding involving Respondent Kahn, Case No. 80-971.

At the formal administrative hearing on the application of Okaloosa County to replace the existing storm water pipe, no testimony was presented or taken concerning the Sun Plaza project and its impact on any alleged drainage problems in the Gap Creek Basin Area. The hearing was limited to the question of whether the replacement of the storm water discharge pipe would have a significant impact on the water quality or designated uses of Gap Creek.

FINDINGS OF FACT

1. Respondent, Okaloosa County Board of County Commissioners, gave notice of a new storm water discharge to the Department for the proposed replacement of a 42" diameter storm water pipe with one 48" in diameter. Notice was given in letters, telephone calls and personnel meetings between representatives of Okaloosa County and the Department.

   
   

2. Upon investigation of the project, the Department determined that the project would not significantly enlarge the storm water discharge system, nor enlarge the watershed which the system now drains. The Department also determined that the addition of an energy dissipater, a structure not now

   present at the discharge end of the pipe, would improve the performance of the discharge system by limiting the velocity of the storm water discharge to 2.3 feet per second.

   
   

3. The Department determined that the new storm water discharge would not have a significant adverse impact on the water quality or designated uses of Gap Creek.

   
   

4. On May 6, 1980, the Department issued to Okaloosa County a letter of intent to exempt the project from storm water licensing requirements. The Department considered the following in reaching its conclusion that the replacement of the existing pipe would not significantly affect water quality or designated usage:

   
   

   1. The use of an energy dissipater structure designed to limit the discharge velocity into Gap Creek to a maximum of 2.3 feet per second.

   2. The placing of sod around all storm water inlets associated with the pipe replacement to prevent the continued entry of sand

      into the system; and

   3. The pipe replacement and addition of the energy dissipater will not result in a significant enlargement of the existing storm water discharge system, nor otherwise result in the drainage of a larger area.

      
      

5. The replacement of the drainage pipe by the county will not add to the amount of water entering Gap Creek, or significantly affect the quality of water in the Creek. Presently, storm water runoff travels within a county-owned drainage ditch and overflows at the point where the county intends to replace the existing 42" pipe. The present pipe is not capable of handling the amount of runoff in the ditch and this results in water overflowing the drainage ditch at the mouth of the pipe and traveling by natural contour to Gap Creek.

   
   

6. The 48" replacement pipe and energy dissipater will allow a greater volume of water to remain in the drainage ditch and divert its flow away from the front and back yards of some Gap Creek residents.

   
   

   CONCLUSIONS OF LAW

   
   

7. The project which was the subject of this hearing is a storm water discharge subject to the notice requirements of Rule 17-4.248(5), Florida Administrative Code.

   
   

8. The scope of this hearing was limited to an examination of the impact on Gap Creek of the discharge from Okaloosa County's proposed modification of the storm water discharge system, as outlined in the Department's letter of intent dated may 6, 1980.

   
   

9. The Petitioner, as the party contesting the validity of that determination, has the burden to prove by a preponderance of competent and substantial evidence that the Department erred in its determination that replacement of the existing storm water pipe would not have a significant impact on the water quality or designated uses of Gap Creek.

10. Petitioner failed to meet its burden of proof in this proceeding by demonstrating through a preponderance of competent and substantial evidence that the replacement of a 42" pipe with a 48" pipe would significantly affect water quality or usage of Gap Creek.

    
    

11. The competent and substantial evidence presented was that the increased storm water discharge would not have a significant impact on the water quality and designated uses of Gap Creek.

    
    

12. Due to the procedural background of this case which was outlined in the preliminary statement, supra, the Petitioners have been unable to effectively present their claims for relief in an administrative forum. Since the Department has exempted the shopping center project from the storm water discharge rule presently in effect, the Petitioner has been denied an opportunity to challenge an agency decision which it alleges is destructive of the environment, as well as the right of certain members of the Gap Creek Residents Association to use their property without fear of flooding.

    
    

13. When this proceeding was initiated, the developer, the association, the county, and local departmental permitting officials were of the apparent belief that the shopping center project was subject to Rule 17-4.248, Florida Administrative Code. The developer engaged in discussions with the Department in order to alleviate concerns that it had over the storm water discharge problem in Gap Creek. Certain modifications were suggested and apparently agreed to.

    
    

14. The Petitioner filed its petitions in reliance upon existing department rules. It was not until after the motion hearing in Case No. 80-971 that Petitioner learned that the stipulation in the prior case, Blairstone, supra., would effectively preclude a full consideration of its claims in a Section 120.57(1) proceeding. The stipulation resulted in the Department charging its position in Case No. 80-971 and asserting that it lacked jurisdiction over the project.

    
    

15. The Department has effectively modified and amended Rule 17-4.428, Florida Administrative Code, by use of a stipulation entered in a prior administrative proceeding. As Case No. 80-971 illustrates, such a procedure effectively denies interested parties the rights afforded under the Administrative Procedures Act, including notice and an assurance that an agency is not acting contrary to law or in excess of its delegated authority.

    
    

16. In Price Wise Buying Group v. Nuzum, 343 So.2d 115 (Fla. 1st DCA 1977), the court found that an agency's attempt to modify an interpretation of an existing rule through declaratory statement invalid. The declaratory statement was said to constitute a rule since its was an agency statement of general applicability which implemented, interpreted and prescribed law or policy. See Section 120.52(14), Florida Statutes. Although notice was presumably given of the declaratory statement in the Florida Administrative Weekly, as required by Section 120.565, Florida Statutes, the court found that the declaratory statement was not properly identified as a rule and "therefore did not give proper notice to interested parties that a rule was being promulgated." Price Wise Buying, supra., at 116.

    
    

17. In the instant case, no notice was given to interested parties that the Department intended to modify or amend Rule 17-4.248, Florida Administrative Code, as to certain developers and their projects. The means by which this was

    attempted to be effectuated afforded no meaningful notice to persons who were not parties to the litigation and accentuated the gap between what the agency and its staff know about the agency's law and policy and what an outsider can know. McDonald v. Department of Banking and Finance, 346 So.2d 569, 580 (Fla. 1st DCA 1977). The procedural safeguards of Chapter 120, Florida Statutes, were avoided and the Petitioner in this case denied an opportunity to present its side of this dispute.

    
    

18. Additionally, the Petitioners have objected to the Department's attempt to stipulate as to the legal interpretation and effect of a rule and apply such stipulation to third persons who were not parties to the stipulation. The Petitioners' objections in this regard are well taken. See 73 Am Jur 2d, Stipulation, at Sections 5 and 9.

    
    

19. The pivotal dispute in these cases do not directly involve Okaloosa County. The County's responsibilities concerning drainage have in large measure been decided by the permitting decisions of the Department. If the Department permits developments which add to the county drainage system, the county must respond by enlarging or modifying its system if necessary. The county's decision to replace the existing drainage pipe has necessarily followed from the increased storm water discharge expected from the new development.

    
    

20. The role of the Hearing Officer in a Section 120.57(1) proceeding is not just to decide facts and interpret law but also to record, recommend and critique agency policy. The Hearing Officer independently serves the public interest by providing a forum to expose, inform and challenge agency policy and discretion. McDonald, supra., at 583. The policy which was followed by the Department in regard to modification or amendment of its storm water discharge rule, Rule 17-4.428, through stipulation, should be re-examined. If the Department believes that the stipulation accurately reflects agency law and policy, then all persons should be placed on notice of the same through the procedures outlined in Chapter 120, Florida Statutes, and all persons similarly situated should be treated the same in the permitting process.

RECOMMENDATION

Upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED:

That a final order be entered by the State of Florida, Department of Environmental Regulation, granting the applicant, Okaloosa County, an exemption from storm water licensing requirements for the installation of a 48" storm water pipe to replace an existing smaller pipe that enters into Gap Creek.

DONE and ORDERED this 27th day of February, 1981, in Tallahassee, Leon County, Florida.

SHARYN L. SMITH, Hearing Officer Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 27th day of February, 1981.

ENDNOTES

1/ The Respondent had applied for a permit and been issued a notice of intent to grant his application with conditions by the Department, on April 25, 1990. The Respondent Kahn and the Department's action in this regard were apparently undertaken pursuant to the rule since neither Kahn nor the local permitting authorities were aware of the applicability of the stipulation to Kahn at the time of his original application.

2/ The petition was dismissed on other grounds and the Petitioner was granted

10 days to file an amended petition which was filed on August 1, 1980.

3/ Due to the Department's position concerning jurisdiction, presumably none of the modifications suggested by the Department in its notice of intent letter of April 25, 1980 can or will be mandated as to this project.

COPIES FURNISHED:

Bruce C. Babbitt, Esquire Post Office Box 1628

Fort Walton Beach, Florida 32549

John R. Dowd, Esquire Post Office Box 1964

Fort Walton Beach, Florida 32548

Paul R. Ezatoff, Jr., Esquire Assistant General Counsel Department of Environmental

Regulation

2600 Blair Stone Road Tallahassee, Florida 32301

=================================================================

AGENCY FINAL ORDER

=================================================================

BEFORE THE STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL REGULATION

GAP CREEK HOMEOWNERS ASSOCIATION,

Petitioner,

vs. DOAH CASE NO. 80-996

STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL REGULATION and OKALOOSA COUNTY BOARD OF COUNTY COMMISIONERS,

Respondents.

/

FINAL ORDER

On the 27th day of February, 1981, the Division of Administrative Hearings' Hearing Officer assigned to conduct a Section 120.57, Florida Statutes, hearing in this case submitted to the Department a Recommended Order, a copy of which is attached hereto as Exhibit "A".

The Recommended Order of the Hearing Officer is adopted, except, as more specifically discussed below, the Hearing Officer's Preliminary Statement is rejected in part, and the Conclusions of Law are adopted in part and rejected in part.

PRELIMINARY STATEMENT

Except for the portions of the Hearing Officer's Preliminary Statement set forth below, the preliminary statement contained in the Recommended Order is rejected as being irrelevant, immaterial, and unnecessary for a decision on the issues contained in Case No. 80-996:

". . . On May 6, 1980, the Department issued a letter of intent to exempt from stormwater licensing the replacement by Okaloosa County of an existing stormwater pipe with a larger 48" diameter pipe which discharges stormwater into Gap Creek in Fort Walton Beach, Florida. By letters dated May 3, 1980 and May 22, 1980, the Gap Creek Homeowners Association (hereafter 'Association') objected to the Department's intended action regarding the enlargement of the stormwater discharge system and replacement of the drainage pipe and petitioned for a formal administrative hearing on the issues. . .

. . . At the formal administrative hearing on the application of Okaloosa County to replace the existing stormwater pipe. . .[t]he hearing was limited to the question of whether the replacement of the stormwater discharge pipe would have a significant impact on the water quality or designated uses of Gap Creek."

FINDINGS OF FACT

The Hearing Officer's Findings of Fact are adopted.

CONCLUSIONS OF LAW

The Conclusions of Law set forth by the Hearing Officer in the Recommended Order are adopted, except as follows:

1. Paragraph 3 of the Conclusions of Law is rejected. The burden of proof in a licensing proceeding is not on a third party Petitioner, but on the applicant, Capeletti Brothers, Inc. v Department of Environmental Regulation, Case No. 79-1602R; Freeport Sulphur Company v. Agrico Chemical Company and the Department of Environmental Regulation, Case No. 78-315; Department of Transportation v. J.W.C. Company, Inc. and Department of Environmental Regulation, Case No. 76-832; Strazzulla Brothers Company, Inc., et al., v. Department of Environmental Regulation, Case No. 78-1287.

   
   

2. Paragraph 4 of the Conclusions of Law is rejected for the same reasons as paragraph 3 and for being irrelevant and unnecessary in view of paragraph 5 of the Conclusions of Law in the Recommended Order.

   
   

3. Paragraphs 6 through 14 of the Conclusions of Law are rejected as being irrelevant, immaterial, and unnecessary. None of the statements or conclusions contained in these paragraphs in any way relate to the issue in this case.

ORDER

The Findings of Fact contained in the Recommended Order are adopted.

That portion of the Preliminary Statement not set forth above is rejected. Paragraphs 1, 2, and 5 of the Conclusions of Law are adopted. All other

Conclusions of Law are rejected.

Therefore, it is,

ORDERED that the applicant, Okaloosa County, is granted an exemption in accordance with Section 17-4.248(5), Florida Administrative code, from stormwater licensing for the installation of a 48" stormwater pipe to replace an existing smaller pipe that enters into Gap Creek, as set forth in this agency's letter of intent dated May 6th, 1980.

DATED this 19th day of March 1981, in Tallahassee, Florida.

VICTORIA J. TSCHINKEL

Secretary

State of Florida Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32301

Telephone: (904)-488-4807

FILING AND ACKNOWLEDGMENT

FILED, on this date, pursuant to S120.52 (9), Florida Statutes, with the designated

Department Clerk, receipt of which is hereby acknowledged.

3-20-81

D. QUIGG for LINDA BEVARD Date

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true copy of the foregoing "Final Order" has been furnished by United States Mail to Bruce C. Babbit, Esquire, Post Office Box 1628, Fort Walton Beach, Florida 32549, and to John R. Dowd, Esquire, Post Office Box 1964, Fort Walton Beach, Florida 32548, this 20th day of March, 1981.

JOHN C. BOTTCHER DEPUTY GENERAL COUNSEL

State of Florida Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32301

(904) 488-9730

Docket for Case No: 80-000996

Orders for Case No: 80-000996