STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

IN RE: PETITION FOR RULE ) CREATION - TOWN CENTER AT PALM ) COAST COMMUNITY DEVELOPMENT ) DISTRICT. )

Case No. 02-1454

)

REPORT TO THE FLORIDA LAND AND WATER ADJUDICATORY COMMISSION

Pursuant to Section 190.005(1)(d), Florida Statutes, Charles A. Stampelos, Administrative Law Judge, conducted a public hearing on July 30, 2002, at 1:00 p.m., in Palm Coast, Flagler County, Florida, for the purpose of taking testimony and public comment and receiving exhibits on the Petition of Florida Landmark Communities, Inc., and Mardem, LLC (collectively, the "Petitioners") to establish the Town Center at Palm Coast Community Development District.

APPEARANCES

For Florida Landmark Communities, Inc. and Mardem, LLC:

Michael D. Chiumento III, Esquire Chiumento & Associates, P.A.

4B Old Kings Road North Palm Coast, Florida 32137

STATEMENT OF THE ISSUE

The sole issue to be addressed is whether the Petition to establish the Town Center at Palm Coast Community Development

District meets the applicable criteria set forth in Chapter 190, Florida Statutes, and Chapter 42-1, Florida Administrative Code.

PRELIMINARY STATEMENT

On March 28, 2002, the Petitioners filed the Petition to establish the Town Center at Palm Coast Community Development District with the Secretary of the Florida Land and Water Adjudicatory Commission ("Commission"). Prior to this time, the Petitioners provided for the delivery of a copy of the Petition and its exhibits, along with the requisite filing fee, to the City of Palm Coast and Flagler County. A copy of the Petition, including its exhibits, was received into evidence as Petitioners' Composite Exhibit A.

On April 10, 2002, the Secretary of the Commission certified that the Petition contained all required elements, as defined in Section 190.005(1)(a), Florida Statutes, and forwarded it to the Division of Administrative Hearings for the purpose of holding the public hearing required under Section 190.005(1)(d), Florida Statutes.

The Commission published a Notice of receipt of the Petition in the Florida Administrative Weekly on June 7, 2002. A copy of this Notice was received into evidence as Petitioners' Exhibit B (WL-9).

The local public hearing was scheduled in Palm Coast, Flagler County, Florida, for Tuesday, July 30, 2002, at 1:00 p.m.

The Petitioners published notice of the hearing in accordance with Section 190.005(1)(d), Florida Statutes. The Proof of Publication of the Notice of Local Public Hearing was received into evidence as Petitioners' Exhibit E.

The land to be included within the proposed District is contained wholly within the boundaries of Flagler County and, more specifically, the incorporated area of Palm Coast.

Section 190.005(a) and (c), Florida Statutes, provides that the county or municipality containing all or a portion of the lands within the proposed District has the option to hold a public hearing within forty-five (45) days of the filing of the Petition. Flagler County held such a hearing on May 6, 2002. At that public hearing, the Flagler County Commission passed a resolution in support of the establishment of the Town Center at Palm Coast Community Development District. A certified copy of the resolution was received into evidence as Petitioners'

Exhibit D.

The City of Palm Coast also held a hearing on June 4, 2002. At that public hearing, the City Council of Palm Coast passed a resolution in support of the establishment of the Town Center at Palm Coast Community Development District. A certified copy of the resolution was received into evidence as Petitioners' Exhibit C.

At the local public hearing on July 30, 2002, the Petitioners presented the testimony of William I. Livingston, President of Florida Landmark Communities, Inc., and Manager of Mardem, LLC; David R. Root, an expert in the management of community development districts; Robert B. Gaylord of Singhofen & Associates, Inc., an expert in civil engineering and public infrastructure; Henry F. Fishkind, Ph.D., of Fishkind & Associates, an expert financial advisor to community development districts; and Robert D. Londeree of Planning & Design, an expert in the field of land planning. The full names and addresses of the Petitioners' witnesses are attached to this Report as

Exhibit 1. Petitioners' Exhibits A through I-3 were received into evidence at the hearing. A list of the Petitioners' exhibits in this proceeding is attached to this Report as Exhibit 2.

No other persons or entities presented any witnesses or exhibits. Several persons attended the public hearing and were given the opportunity to cross-examine the Petitioners' witnesses and to provide testimony.

The one-volume transcript of the local public hearing was filed on August 23, 2002, with the Division of Administrative Hearings. The original transcript and hearing exhibits are transmitted with this Report.

FINDINGS OF FACT

Overview

1. The Petitioners are seeking the adoption of a rule by the Commission to establish a community development district ("CDD") proposed to consist of approximately 1,600 gross acres located within the boundaries of incorporated areas of Palm Coast. The suggested name for the proposed District is the Town Center at Palm Coast Community Development District.

2. There are no out-parcels within the area to be included in the proposed District.

3. The estimated cost of the infrastructure facilities and services, which are presently expected to be provided to the lands within the District, was included in the Petition.

4. The sole purpose of this proceeding is to consider the establishment of the District as proposed by the Petitioners.

   Summary of Evidence and Testimony

   
   

   1. Whether all statements contained within the Petition have been found to be true and correct.

      
      

5. Petitioners' Exhibit A was identified for the record as a copy of the Petition and its exhibits as filed with the Commission.

6. Livingston testified that he reviewed the contents of the Petition and approved its findings. Livingston also generally described the exhibits to the Petition. Livingston

   testified that the Petition and its exhibits are true and correct to the best of his knowledge.

7. Gaylord testified that he assisted in the preparation of portions of the Petition and its exhibits. Gaylord also generally described Exhibits 5 and 6 to the Petition which he or his office had contributed to and stated that they were true and correct to the best of his knowledge.

8. Fishkind testified that he had prepared Exhibit 10 to the Petition, the Statement of Estimated Regulatory Costs (SERC). Fishkind also testified that the SERC submitted as Exhibit 10 to Petitioners' Exhibit A was true and correct to the best of his knowledge.

9. Livingston testified that the consent by the owner of lands to be included within the proposed District is still in full force and effect. The Petition included written consent to establish the District from the owners of one hundred percent (100%) of the real property located within the lands to be included in the proposed District.

10. Londeree testified that he had prepared Exhibits I-1 through I-3 and briefly described each exhibit. Londeree testified that Exhibits I-1 through I-3 were true and correct to the best of his knowledge.

11. Based on the foregoing, the evidence shows that the Petition and its exhibits are true and correct.

    1. Whether the establishment of the District is inconsistent with any applicable element or portion of the State Comprehensive Plan or the effective local government comprehensive plan.

       
       

12. Londeree reviewed the proposed District in light of the requirements of the State Comprehensive Plan, Chapter 187, Florida Statutes. Londeree also reviewed the proposed District in light of the requirements of the City of Palm Coast Comprehensive Plan.

13. From a planning and economic perspective, three (3) subjects of the State Comprehensive Plan apply directly to the establishment of the proposed District as do the policies supporting those subjects.

14. Subject 16, Land Use, recognizes the importance of locating development in areas that have the fiscal abilities and service capacity to accommodate growth. Section 187.201(16), Florida Statutes. It is relevant because CDDs are designed to provide infrastructure services and facilities in a fiscally responsible manner to the areas which can accommodate development. The evidence shows that the establishment of the Town Center at Palm Coast CDD will not be inconsistent with this goal because the District will have the fiscal capability to provide the specified services and facilities within its boundaries.

15. Subject 18, Public Facilities, relates to (i) protecting investments in existing public facilities; (ii) providing financing for new facilities; (iii) allocating the costs of new public facilities on the basis of the benefits received by future residents; (iv) implementing innovative, but fiscally sound techniques for financing public facilities; and

    (v) identifying and using stable revenue sources for financing public facilities. Section 187.201(18), Florida Statutes. The evidence shows that the establishment of the Town Center at Palm Coast CDD will further these State Comprehensive Plan Goals and Policies.

16. Subject 21, Governmental Efficiency, provides that governments shall economically and efficiently provide the amount and quality of services required by the public. Section 187.201(21), Florida Statutes. The evidence shows that the proposed CDD will be consistent with this element because the proposed CDD will continue to: (i) cooperate with other levels of Florida government; (ii) be established under uniform general standards as specified in Chapter 190, Florida Statutes; (iii) be professionally managed, financed, and governed by those whose property directly receives the benefits; (iv) not burden the general taxpayer with costs for services or facilities inside the District; and (v) plan and implement cost-efficient solutions for

    the required public infrastructure and assure delivery of selected services to residents.

17. Based upon the testimony and exhibits in the record, the proposed District will not be inconsistent with any applicable element or portion of the State Comprehensive Plan.

18. In 2000, the City of Palm Coast approved a Comprehensive Plan Amendment bringing the Petitioners' property into compliance with the City's adopted Comprehensive Plan.

19. Based on the evidence in the record, the proposed District will not be inconsistent with any applicable element or portion of the Local Comprehensive Plan, and can be expected to further the goals provided.

    1. 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.

       
       

20. Testimony on this criterion was provided by Londeree, Fishkind, and Gaylord. The lands that comprise the proposed District will consist of approximately 1,600 gross acres, located within the borders of incorporated Palm Coast.

21. All of the land in the proposed District is part of a planned community included in the Town Center at Palm Coast Development of Regional Impact (DRI), which is currently under review.

22. "Functional interrelated community" means that the community development plan requires that the residents and property owners will be provided those facilities that are the necessary services for a mixed-use community. These facilities include streets, stormwater ponds, water and sewer service, street lighting, sidewalks, bike paths and associated landscaping. All of these elements will tie the land uses of the community together to provide a unity of design and function for the community. The community facilities that are provided require a long-range development plan that addresses the management, scheduling, funding, construction, and maintenance of the required infrastructure for the growth and development of the community.

23. The size of the District as proposed is approximately 1,600 gross acres. From a planning perspective, this is a sufficient size to accommodate the basic infrastructure facilities and services typical of a functionally interrelated community. The proposed facilities and services require adequate planning, design, financing, construction, and maintenance to provide the community with appropriate infrastructure.

24. Compactness relates to the location in distance between the lands and land uses within a community. The proposed District provides for a cost-effective and efficient design and

    delivery of the required infrastructure and the future maintenance of same.

25. The Petitioners are developing all the lands within the District as a single master-planned community. All of these lands will be governed by the Town Center at Palm Coast Development of Regional Impact Development Order to be issued by the City of Palm Coast, Flagler County, Florida.

26. The evidence shows that from planning, economics, and engineering perspectives, the area of land to be included in the proposed District is of sufficient size, is sufficiently compact, and is sufficiently contiguous to be developed as a single functionally interrelated community.

    1. Whether the proposed district is the best alternative available for delivering community development services and facilities to the area that will be served by the proposed district.

       
       

27. It is presently intended that the District will participate in the construction or provision of certain infrastructure improvements as outlined in the Petition.

28. The District will construct certain infrastructure and community facilities which will be needed by the property owners and residents of the project. It is anticipated that the CDD will issue 30-year special assessment bonds to pay for the major infrastructure improvements. Expenses for the operations and maintenance are expected to be paid through annual maintenance

    assessments to ensure that the property or person receiving the benefit of the district services is the same property or person to pay for those services.

29. Two types of alternatives to the use of the District were identified. First, the City of Palm Coast might provide facilities and services from its general fund. Second, facilities and services might be provided by some private means, with maintenance delegated to a home owners' association.

30. A community development district allows for the independent financing, administration, operations, and maintenance of the land within such a district. A community development district allows district residents to completely control the district. The other alternatives do not have these characteristics.

31. From an engineering perspective, the proposed District is the best alternative to provide the proposed community development services and facilities to the land included in the proposed District because the District will provide the necessary means to maintain the project consistent with the intent of the original design. Alternative approaches, such as dedicating the area to another municipality, may result in conditions deviating from the original intent of the project. A localized agency (District) that is focused on maintaining and governing the area will help to ensure that the design and intent for which the

    project was developed and presented to the public will be maintained.

32. The evidence shows that from planning, economic, engineering, and special district management perspectives, the proposed District is the best alternative available for delivering community development services and facilities to the area that will be served by the District.

    1. 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 development services and facilities.

       
       

33. The services and facilities proposed to be provided by the District are not incompatible with uses and existing local and regional facilities and services. Currently, the land within the proposed District boundaries is undeveloped and, therefore, cannot duplicate the local or regional facilities. The facilities within the District are designed to meet, and in some areas exceed, the current design requirements by local municipalities and are, therefore, compatible with the capacities and uses of the existing regional community development facilities and services.

34. Therefore, the evidence shows that the community development services and facilities of the proposed district will not be incompatible with the capacity and uses of existing local and regional community development services and facilities.

    1. Whether the area that will be served by the district is amenable to separate special-district government.

       
       

35. As previously noted, from planning, economics, and engineering perspectives, the area of land to be included in the proposed District is of sufficient size, is sufficiently compact, and is sufficiently contiguous to be developed and become a functionally interrelated community. The community to be included in the District needs the basic infrastructure systems to be provided.

36. From planning and economic perspectives, the area that will be served by the proposed District is amenable to separate special-district government.

    1. Other requirements imposed by statute or rule.

    
    

37. Chapter 190, Florida Statutes, and Chapter 42-1, Florida Administrative Code, impose specific requirements regarding the Petition and other information to be submitted to the Commission.

    Elements of the Petition

    
    

38. The Commission has certified that the Petition to Establish the Town Center at Palm Coast Community Development District meets all of the requirements of Section 190.005(1)(a), Florida Statutes.

    Statement of Estimated Regulatory Costs (SERC)

    
    

39. The SERC contains an estimate of the costs and benefits to all persons directly affected by the proposed rule to establish the District--the State of Florida and its citizens, the County and its citizens, the City and its citizens, the Petitioners, and consumers.

40. Beyond administrative costs related to rule adoption, the State and its citizens will only incur minimal costs from establishing the District. These costs are related to the incremental costs to various agencies of reviewing one additional local government report. The proposed District will require no subsidies from the State. Benefits will include improved planning and coordination of development, which are difficult to quantify, but nonetheless substantial.

41. Administrative costs incurred by the City of Palm Coast and Flagler County related to rule adoption should be minimal. Benefits to the City of Palm Coast and Flagler County will include improved planning and coordination of development, without incurring any administrative or maintenance burden for facilities and services within the proposed District except for those it chooses to accept.

42. Consumers will pay special assessments for certain facilities. Location in the District by new residents 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 the option of having 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 share of direct control over community development services and facilities within the area.

43. Section 190.005(1)(a), Florida Statutes, requires the Petition to include a SERC which meets the requirements of Section 120.541, Florida Statutes. The Petition contains an SERC. It meets the requirements of Section 120.541, Florida Statutes.

    Other Requirements

    
    

44. Petitioners have complied with the provisions of Section 190.005(1)(b)1., Florida Statutes, in that Flagler County and City of Palm Coast were paid the requisite filing fees.

45. Section 190.005(1)(d), Florida Statutes, requires the Petitioners to publish notice of the local public hearing in a newspaper of general circulation in Flagler County and the City of Palm Coast for four successive weeks prior to the hearing. The notice was published in the legal Advertisement section of the Flagler/Palm Coast News-Tribune, a newspaper of general

    circulation, for five (5) successive weeks, on June 29, July 6, July 13, July 20, and July 27, 2002.

    Flagler County's Support for Establishment

    
    

46. Pursuant to the requirements of Section 190.005(1)(b), Florida Statutes, Petitioners filed a copy of the Petition and the $15,000.00 filing fee with Flagler County prior to filing the Petition with the Commission.

47. As permitted by Section 190.005(1)(c), Florida Statutes, the Flagler County Commission held a public hearing on May 6, 2002, to consider the establishment of the Town Center at Palm Coast Community Development District.

48. At the conclusion of its public hearing on May 6, 2002, and after considering the factors enumerated in Section 190.005(1)(e), Florida Statutes, and the representations in the SERC, the Flagler County Commission adopted Resolution No. 2002- 50, expressing support for the Commission to promulgate a rule establishing the Town Center at Palm Coast Community Development District.

    Palm Coast's Support for Establishment

    
    

49. Pursuant to the requirements of Section 190.005(1)(b), Florida Statutes, Petitioners filed a copy of the Petition and

    $15,000.00 filing fee with the City of Palm Coast prior to filing the Petition with the Commission.

50. As permitted by Section 190.005(1)(c), Florida Statutes, the City of Palm Coast held a public hearing on June 4, 2002, to consider the establishment of the Town Center at Palm Coast Community Development District.

51. At the conclusion of its public hearing on June 4, 2002, the City of Palm Coast Commission adopted Resolution

    No. 2002-18, expressing support for the Commission to promulgate a rule establishing the Town Center at Palm Coast Community Development District.

    CONCLUSIONS OF LAW

    
    

52. This proceeding is governed by Chapters 120 and 190, Florida Statutes, and Chapter 42-1, Florida Administrative Code.

53. The proceeding was properly noticed pursuant to Section 190.005(1)(d), Florida Statutes, by publication of an advertisement in a newspaper of general circulation in Flagler County and the City of Palm Coast, once each week for the five

    (5) successive weeks immediately prior to the hearing.

    
    

54. The Petitioners have met the requirements of Section 190.005, Florida Statutes, regarding the submission of the Petition and satisfaction of filing fee requirements.

55. The Petitioners bear the burden of establishing that the Petition meets the relevant statutory criteria set forth in Section 190.005(1)(e), Florida Statutes.

56. All portions of the Petition and other submittals have been completed and filed as required by law.

57. All statements contained within the Petition as corrected and supplemented at the hearing are true and correct.

58. The establishment of the District is not inconsistent with any applicable element or portion of the State Comprehensive Plan or the Palm Coast Comprehensive Plans.

59. 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.

60. The proposed District is the best alternative available for delivering community development services and facilities to the area that will be served by the District.

61. The community development services and facilities of the proposed District will not be incompatible with the capacity and uses of existing local and regional community development services and facilities.

62. The area to be served by the proposed District is amenable to separate special district government.

RECOMMENDATION

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

RECOMMENDED that the Governor and Cabinet, sitting as the Florida Land and Water Adjudicatory Commission, pursuant to Chapters 120 and 190, Florida Statutes, and Chapter 42-1, Florida Administrative Code, establish the Town Center at Palm Coast Community Development District as requested by the Petitioners by formal adoption of the proposed rule.

DONE AND ENTERED this 27th day of August, 2002, in Tallahassee, Leon County, Florida.

CHARLES A. STAMPELOS

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 27th day of August, 2002.

COPIES FURNISHED:

Michael Chiumento, III, Esquire Chiumento & Associates, P.A.

4 Old Kings Road, North, Suite B Palm Coast, Florida 32137

Donna Arduin, Secretary Florida Land and Water

Adjudicatory Commission The Capitol, Room 2105 Tallahassee, Florida 32399

Barbara Leighty, Clerk

Growth Management and Strategic Planning The Capitol, Room 2105

Tallahassee, Florida 32399-0001

Charles Canady, General Counsel Office of the Governor

The Capitol, Suite 209 Tallahassee, Florida 32399-1001

Exhibit 1

Petitioners' Witnesses at the Public Hearing

William I. Livingston, President Florida Landmark Communities, Inc. One Corporate Drive, Suite 3A Palm Coast, Florida 32137

David R. Root

14 Fern Court

Palm Coast, Florida 32137

Robert B. Gaylord Singhofen & Associates 6961 University Boulevard

Winter Park, Florida 32792

Henry F. Fishkind, Ph.D. Fishkind & Associates 11869 High Tech Avenue Orlando, Florida 32817

Robert D. Londeree Planning and Design Post Office Box 1077

Windermere, Florida 34786

Exhibit 2

List of Petitioners' Exhibits

Letter Description

1. Petition for Rulemaking to Establish a Uniform Community Development District (Petition with ten (10) Exhibits)

   
   

2. Composite Exhibit -- Prefiled Testimony of William I. Livingston (10 pages)

   
   

   1. General Location Map

      
      

   2. Vicinity Map showing District boundaries

      
      

   3. Metes and Bounds Description of District boundaries B-4 Written Consent of Landowners

   1. Utility Plan showing major trunk water mains and sewer interceptors adjacent to District boundaries

      
      

   2. Development Costs and Timetable

      
      

   3. Conceptual Site Plan showing public and private uses B-8 Land Use Plan

3. Resolution No. 2002-18, of the City Council of the City of Palm Coast endorsing the formation of the Town Center at Palm Coast CDD

   
   

4. Resolution No. 2002-50, of Flagler County, Florida's County Commissioners demonstrating its support of the formation of the Town Center at Palm Coast CDD

   
   

5. Proof of Publication from Flagler/Palm Coast News- Tribune

   
   

6. Prefiled Testimony of David R. Root (5 pages)

   
   

7. Prefiled Testimony of Robert B. Gaylord (6 pages)

   
   

   1. Utility Plan showing major trunk water mains and sewer interceptors adjacent to District boundaries

      
      

   2. Development Costs and Timetables

   
   

8. Prefiled Testimony of Henry F. Fishkind, Ph.D., (6 pages)

   
   

   1. Statement of Estimated Regulatory Costs for the Town Center of Palm Coast CDD

I Prefiled Testimony of Robert D. Londeree (9 pages) I-1 Town Center at Palm Coast Development of Regional

Impact Application for Development Approval

1. Town Center at Palm Coast Development of Regional Impact Application for Development Approval Response to Request for Additional Information (Sufficiency Response)

   
   

2. Petitioners' FLUM Amendment for Town Center at Palm Coast Application

Docket for Case No: 02-001454

Orders for Case No: 02-001454