Findings Of Fact Petitioner is the receiver for Bayside Club, Islamorada, Inc., a dissolved Florida corporation ("Bayside"). Mr. Joseph Popplewell is a general contractor and former president of Bayside. Respondent is the governmental entity authorized by Chapter 76-441, Section 14(1), Laws of Florida, to adopt impact fees for the water system in the Florida Keys, to equitably adjust the financial burden of a new pipeline, and to expand it or improve appurtenant facilities between existing customers and new water users. In 1986, Bayside sought to construct a 30 unit hotel on approximately one acre of land in Monroe County, Florida. The development project was formally classified as an expansion of an existing eight unit hotel. The existing hotel, however, had little, if any, useful life, and, in substance, the project involved the development of a new 30 unit hotel. Bayside obtained a building permit on June 4, 1985. In the same month, the building permit was challenged by an adjacent land owner. The challenge asserted that the existing hotel constituted a grandfathered nonconforming use and that the building permit improperly treated the development site as if it were located in a zoning district which permitted hotel usage and subsequent expansion. During the last half of 1985, the Monroe County Commission considered the challenge to the building permit and found that the building permit was valid. The adjacent landowner filed suit against Bayside. The circuit court upheld the validity of the building permit. The suit was finally decided on May 29, 1990, when the Third District Court of Appeal reversed the lower court's decision that the building permit was valid. Dowd v. Monroe County, 557 So.2d 63 (Fla. 3d DCA 1990). On May 29, 1990, the circuit court entered its order declaring the building permit invalid. In 1986, Bayside was advised by Respondent that unit water system development fees ("impact fees") were scheduled to increase from $1,500 to $2,000. Bayside chose to avoid paying impact fees at the increased unit rate and to achieve a savings in development costs. On or about April 18, 1986, Bayside executed an Agreement For Water Service. On or about April 29, 1986, Bayside issued a check payable to Respondent in the amount of $36,840, which included impact fees in the aggregate amount of $33,000. As provided in Florida Administrative Code Rule 48-3.002 2., the Agreement For Water Service expressly stated in paragraph 1 that "SAID SYSTEM DEVELOPMENT CHARGE SHALL NOT BE REFUNDABLE." Construction of the proposed hotel stopped sometime in 1986. A receivor was appointed for Bayside by the appropriate circuit court on June 14, 1991. Sometime in early 1992, the receiver for Bayside requested a refund of the impact fees. Respondent denied that request in a letter dated February 27, 1992, but refunded amounts paid by Respondent in excess of the impact fees. Respondent's denial of Petitioner's request for a refund did not constitute an unreasonable classification and did not establish a differential rate that was either unjust or inequitable. Respondent has consistently applied Florida Administrative Code Rule 48-3.002 2. to prohibit the refund of impact fees regardless of the classification or rate charged the person who paid the impact fee. Petitioner had adequate notice in Rule 48-3.002 2. and the Agreement For Water Service that the impact fees were nonrefundable. Respondent reasonably anticipated that the projected costs for expanding the water system would be incurred. The county commission and circuit court both upheld the validity of the building permit. If Bayside reasonably anticipated that projected costs for expanding the water system and appurtenant facilities would not be incurred due to a suit challenging the building permit, Bayside had the option of not paying the impact fees until the final conclusion of litigation. Bayside was on notice that the impact fees were nonrefundable and chose to forego its option not to pay the fees until the conclusion of the suit challenging the building permit. Bayside made a business decision to save money and time by paying the impact fees when it did. Viewed in the light of hindsight, that business decision was imprudent. Bayside did not notify Respondent that the costs of expanding the system were not reasonably anticipated until six years after Bayside chose to pay the impact fees. The nonrefundable impact fees imposed by Respondent in 1986 were just and equitable. Expansion of the water system pipeline and appurtenant facilities was reasonably required as a result of the development proposed by Bayside at the time that the impact fees were imposed. The costs attributable to such expansion were reasonably anticipated by Respondent at the time that the impact fees were imposed. The use of the impact fees was limited to meeting such reasonably anticipated costs of expansion. The impact fees imposed by Respondent in 1986 did not exceed a pro rata share of reasonably anticipated costs. Expansion of Respondent's water system was necessary irrespective of the proposed hotel. The expansion of Respondent's water system and appurtenant facilities was financed through the sale of debentures. The indebtedness incurred is made good through revenues in the form of rates, fees, and other charges. Under such circumstances, rates and fees were set with a view towards raising the money necessary to repay the loan. The impact fees did not cease to be just and equitable merely because they were set high enough to meet the water system's reasonably anticipated capital requirements.
Findings Of Fact By letter dated August 10, 1979, Indian River County (hereafter "County") submitted to the Department of Environmental Regulation (hereafter "Department" or "DER") applications for construction permits for the Gifford Area sewer treatment plant and collection improvements thereto, a domestic wastewater treatment and disposal system located in the County. (DER Exhibits Nos. 1 & 2). After receiving the permit applications submitted by the County, the Department's Orlando District Office requested additional information to determine whether reasonable assurances were provided that the facility would not discharge, emit or cause pollution in violation of Department standards. (Testimony of William Bostwick; testimony of Chancellor; DER Exhibits Nos. 3, 4, 5, 6, 7 & 8). The County, through its consulting engineers Sverdrup & Parcel and Associates, Inc., responded to the Department's requests for additional information. (DER Exhibits Nos. 3, 4, 5, 6, 7 & 8). The Department presented testimony of two professional engineers in its employ, Mr. William M. Bostwick and Mr. Gerald Chancellor, both of whom were accepted as expert witnesses in the field of sewage treatment technology and the processing and evaluation of permit applications for sewage treatment plants. Both witnesses testified that in their expert and professional opinion, based on their review of all plans, test results and other information submitted by the County, the applicant provided the Department with reasonable assurances that the proposed construction and operation of the sewage treatment facility and its collection system would not discharge, emit or cause pollution in violation of Department standards. (Testimony of Bostwick; testimony of Chancellor). The standards applicable to the subject construction permit applications involve (a) treatment level and (b) ambient standards of the receiving waters. The proposed system provides a minimum of ninety (90) percent treatment to incoming wastewaters. Because of the added features of surge tanks, gas chlorination, and dual blowers and motors, the ninety (90) percent minimum treatment was expected to be exceeded. (Testimony of Bostwick; testimony of Chancellor). The secondarily treated effluent from the proposed sewage treatment plant will be dispersed by spray irrigation. Because the effluent is expected to percolate to area groundwaters, the ambient groundwater standards of Section 17-3.101, Florida Administrative Code are applicable. The discharge from the facility will not cause any violation of the groundwater quality standards of the Florida Administrative Code. (Testimony of Bostwick; testimony of Chancellor; testimony of Aront). Although the design of the plant does not contemplate surfacewater discharge, if it did, it would meet the waste load allocation of Indian River County which permits discharge to surfacewaters. When the treated waste leaves the sprinkler head, it will meet secondary water treatment standards. (Testimony of Bostwick; testimony of Chancellor). In the course of evaluating a permit application for a wastewater treatment plant, the Department considers only Chapter 403, Florida Statutes, and its implementing rules and regulations and does not consider local issues relating to zoning, the propriety of expenditure of public funds or the like. (Testimony of Bostwick). There is presently no state standard regulating permissible levels of viruses in effluent discharged to either surface of groundwaters. Large numbers of viruses exist in the effluent discharged from spray irrigation treatment plants which operate at a ninety (90) percent treatment level. The viruses contained in the discharge remain viable as they percolate through the soil. The greatest concern exists when humans are in physical contact with such discharge. However, the present sewage treatment facility in its existing condition is a greater threat to public health than the proposed spray irrigation system. (Testimony of Dr. Welling, Petitioner's Exhibits Nos. 1, 2 & 3). Research concerning viral standards for effluent discharge is in an experimental stage. The Department is examining this question for possible future rule drafting. Neither the federal government nor any state, with the exception of Maryland, has adopted viral standards. (Testimony of Welling) The design of Use Gifford plant contemplates a series of perimeter monitoring wells through which groundwater samples can be attained and tested for compliance with groundwater standards end the presence of viruses. (Testimony of Aront) The plant will spray irrigate effluent at the rate of one (1) inch per week. Although surface run off is not expected, any that occurs due to heavy rains, etc., will be discharged into a perimeter ditch surrounding the plant. The plant design is formulated to retain effluent on site. (Testimony of Chancellor). There are four (4) different types of soil on the site with a water permeability of moderately rapid to very rapid. These soils have a percolation rate which makes the site suited for the intended purpose provided surface drainage is obtained. On a conservative basis the site could accept up to fourteen (14) inches of water per day or ninety-eight (98) inches per week. (Testimony of Connell; testimony of Eng; DER Exhibit No. 6). The parties stipulated prior to the hearing to the following: The project complies with local zoning laws; and The applicable provisions of law are Sections 403.086, 403.087, 403.088, Florida Statutes, and Rules 17-3.091, 17-4.03, 17-4.07 and 17-4.26, Florida Administrative Code.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That the Department issue a construction permit to the County on condition that sample effluent from the monitoring wells on the subject facility be regularly analyzed for compliance with Department rules and the existence of infectious viruses. DONE and ENTERED this 3rd day of March, 1980, at Tallahassee, Florida 32301. SHARYN SMITH Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 COPIES FURNISHED: Sherman N. Smith, Jr., Esquire Post Office Box 1030 Vero Beach, Florida 32960 George G. Collins, Jr., Esquire Post Office Box 3686 Vero Beach, Florida 32960 Segundo J. Fernandez, Esquire Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32301
Findings Of Fact At all times pertinent to the allegations herein, the Petitioner, Pinellas County Construction Licensing Board, (Board), was the Pinellas County agency responsible for the certification and regulation of construction specialties. Respondent was certified by the Board as an irrigation systems specialty contractor under license C-5997 in force at the time. Respondent was the qualifying contractor for Sun City Lawn Irrigation. On or about May 17, 1994, Respondent contracted with William J. Schneider, who resided at 5661 25th Avenue North in St. Petersburg, to install a lawn irrigation system in Mr. Schneider's front lawn. The automatic system was to incorporate 2 zones and was, according to the contract and the testimony of Mr. Schneider, to be connected to Schneider's then existing 1/2 horsepower electric pump which drew water from several wells on his property. Mr. Schneider claims there are four wells. No evidence was introduced to contradict that. On the day the system was installed, Mr. Schneider was not at home. Respondent's employees performed a test of the water capacity on Mr. Schneider's property. At first, the wells produced 10 gpm, which was adequate for the system, but after a few minutes of drawdown, they found that the wells were producing only 4 gpm, along with some air. At that time Mr. Freestone, Respondent's sales manager, spoke with Mrs. Schneider about the situation, advising her there were two options open. One was to install a larger pump and the second was to connect the system to the city water supply. Mrs. Schneider returned to the house, presumably to call Mr. Schneider to get his decision on the matter. He claims she did not reach him. Respondent claims that she thereafter returned with directions to install a water line for connection to the city system. This is completely contrary to what Mr. Schneider had wanted and to what is included in the contract. Mr. Schneider claims he did not want to connect to city water because of the added expense of doing so, and he claims he made this very clear to Respondent's employees at the beginning and at all times thereafter. In any case, the system was installed and was, somehow, connected to the city water system near the place where the water line enters the house. In addition, no backflow preventer was installed to insure against contamination getting into the water system as is required by the building code. Most, if not all, the work on this project was completed by Respondent's son and employee, Scott, who was not present at the hearing. Respondent attempted to introduce an unsworn written statement by Scott Bosworth, but it was not accepted. Scott advised Mr. Schneider, when he returned from work that day, that they had been unable to use his pump and wells. Nonetheless, Mr. Schneider paid Respondent in full for the work for which he had contracted, except for a supplemental charge in the amount of $190.95 for the tie in to the city water and the valves and other items connected therewith. Mr. Schneider claims that he made several calls to Respondent's office in an effort to correct the situation but was unable to reach anyone who could give him satisfaction. However, the evidence indicates that on at least one occasion, Mr. Schneider got through and was called back by Mr. Freestone with whom he discussed the situation and the additional charges. He was subsequently advised by counsel that he did not have to pay the additional sum and did not do so. Some time thereafter, Mr. Schneider was advised by the city that he would be fined because of the illegal installation. He then contacted another irrigation company, run by Mr. Williams, who examined the system and determined that the irrigation system installed by Respondent had been connected to the city water system and that no backflow preventer had been installed. A check with the city's building department revealed that no permit had been procured for this installation. Respondent's license to install irrigation systems does not include authority to connect that system with the public water system. That procedure must be done by a licensed plumber. Respondent and Mr. Freestone, the only individuals in the company who had the authority to arrange with a plumber to make the actual hook up to the city system, both deny that any arrangement was made by them to have the system connected to the city water system. Mr. Schneider arrived home on the day in question to find only Respondent's son, Scott, at work on the project. Scott indicated it would be necessary to move two bushes near the house to facilitate connection of the system with the water supply. Mr. Schneider contracted with Scott to move the bushes and remove them from the premises. Scott moved them but failed to remove them. In light of the fact that Scott was working on the system at the time Mr. Schneider arrived home, and the system was found to be connected to the city system thereafter without anyone else touching it, it must be concluded that the connection was made him. Respondent admits he did not come to the property in question while the system was being installed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be issued by the Board suspending the license of the Respondent for a period of six months with provision for withholding execution of the suspension for a period of one year conditioned upon such criteria as may be deemed appropriate by the Board. RECOMMENDED this 31st day of March, 1995, in Tallahassee, Florida. ARNOLD H. POLLOCK 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 31st day of March, 1995. COPIES FURNISHED: William J. Owens Executive Director Pinellas County Construction Licensing Board 11701 Belcher Road Largo, Florida 34643-5116 Larry J. Bosworth 8901 14th Street North St. Petersburg, Florida 33716
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following facts relevant to the issues presented for determination are found: Quality of Service The prime concern and complaint of the customers who testified at the hearing was the quality of water they receive in their homes. The water was described as containing high levels of chlorine, to the extent that it smells of chlorine and, on occasion, fades or bleaches colored clothing when washed. At times, the water is cloudy or rusty in appearance and contains debris, such as sand, dirt or pebbles. One witness testified that clothing had been stained by rust in the wash water. Samples of water received into evidence illustrate the muddy appearance of the water, with debris visible. At times, the water is colored with algae, resulting in greenish-colored ice cubes. Broken appliances are attributed by several customers to have resulted from the debris contained in the water. Customers have experienced low water pressure in their homes and water outages for up to ten hours without prior notice from the petitioner. It was not established whether such water outages were the result of routine maintenance or emergency repairs. Several witnesses found it difficult to contact petitioner regarding billing errors and that slow or no responses to their inquiries were received. The billing errors included mailing the bill to the wrong address and the amounts of the bill. One such latter complaint is presently before the consumer affairs division of the Public Service Commission. The only complaints regarding sewer service were that there is often an unacceptable odor and that "there was sewage boiling out on my street two days in a row." (T.51) Notice of the hearing in this cause was mailed to all customers on February 25, 1981. The rate case documents were delivered by an employee of petitioner to the Clerk's office of the Lake County County Commission in the Lake County Courthouse on February 17, 1981. Water samples are taken on a monthly basis from each of the petitioner's plants. These samples are then analyzed for water quality in a state-controlled laboratory and the results are then sent to the Florida Department of Environmental Regulation and the local Health Department. Personnel from these regulatory bodies occasionally visit the plants and make independent tests. None of the petitioner's water systems or its sewer system are presently under citation from any regulatory body. A citation existing prior to the petitioner's acquisition of the Palms Mobile Home Park water system has been removed. Prior to the hearing, Petitioner's vice-president of operations, Charles Sweat, had not received any complaints from customers regarding the level of water pressure in their homes. With regard to notification of customers of water outages, it is the petitioner's policy to give a twenty-four hour written notice to all customers for planned, scheduled maintenance which would require the water to be off for any length of time. When accidents or emergencies occur, petitioner devotes its concentration to the restoration of service and advance notice is not possible. The Department of Environmental Regulation has minimum requirements relating to the amount of chlorine which must be added to a water system. There are no maximum requirements. One of the Fern Terrace water samples received into evidence at the hearing was very brown in appearance. On the day upon which that sample was taken, the system had experienced a malfunction of the air compressor, causing all the water to go out of the system. The brown-colored water was the result of debris and rust that had built up in the bottom of the tank. The inside of the tanks are cleaned on a periodic basis, and that particular tank had been cleaned approximately six months ago. Petitioner does have a main flushing program, and each system is flushed on a regular basis, the frequency of which is dependent upon the type of pipeline used and the quality of the water in the system. A flushing report is maintained to record the appearance of the water at the beginning and at the end of the flushing, the chlorine residual in the water, the amount of time taken and the estimated gallons flushed out of the line. No explanation was provided for another muddy water sample received into evidence. Rate Setting for the Morningview Sewer System The Morningview sewer system is capable of supporting a maximum of forty-two (42) residential connections. At the end of the 1979 test year, the system had only twenty-six (26) connections. The respondent, Public Service Commission seeks to impute sewer revenues from the unsold lots in the Morningview subdivision so as to recognize the plant capacity of 42 connections. It was undisputed that the sewer plant was 100 percent used and useful and no adjustment was made to this figure. Since petitioner's acquisition of the Morningview sewer system, it has experienced an average annual growth rate of 13.16 percent. During the last year and one-quarter, the growth rate has been approximately 25 percent. The number of connections has increased from 19 in 1976 to the present 30. Eleven connections have been added in a little over four years. The revenues from the imputed connections were obviously not collected during the test year, nor were they collected in 1980. It would take approximately three years to collect the imputed revenues at the current rate of growth. The Public Service Commission has not adopted a rule allowing this imputation method of ratesetting. The pro forma approach has been used in setting rates for a new utility or development, and has been described as an "innovative" method of adjusting used and useful plant. Expenses in addition to increased costs for electrical power and chlorine necessitated by the increased number of connections were not considered by the Public Service Commission to be material. Additional connections to the sewer system would involve some additional billing and service costs, though the difference in fixed costs for serving 42 connections and 26 connections is minimal.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that no adverse consequences be imposed upon the petitioner in its application for rate increases as a result of the quality of water and sewer service provided to its customers in Lake County, Florida. It is further RECOMMENDED that revenues not be imputed for 42 connections to the Morningview sewer system. Respectfully submitted and entered this 24th day of April, 1981, in Tallahassee, Florida. DIANE D. TREMOR, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 24th day of April, 1981. COPIES FURNISHED: R.M.C. Rose Myers, Kaplan, Levinson, Kenin and Richards Suite 103, 1020 Lafayette Street Tallahassee, Florida 32301 M. Robert Christ Legal Department Public Service Commission 101 East Gaines Street Tallahassee, Florida 32301 Jack Shreve Public Counsel Room 4 - Holland Building Tallahassee, Florida 32301 Steve Tribble, Clerk Public Service Commission 101 East Gaines Street Tallahassee, Florida 32301 Joe Cresse, Chairman Public Service Commission The Fletcher Building 101 East Gaines Street Tallahassee, Florida 32301 Anna Marie Norman 1219 LaSalida Way Leesburg, Florida 32748 Marilyn Smith 2924 North Porto Bello Avenue Leesburg, Florida 32748 Patti L. Wolf 2922 Alta Street Leesburg, Florida 32748 Anna P. Cowin 2913 North Porto Bello Avenue Leesburg, Florida 32748 Pam Angelillo 2922 Cocovia Way Leesburg, Florida 32748
The Issue Whether Betmar Utilities, Inc.'s application for an expansion of territory under its water and wastewater certificates in Pasco County should be approved by the Public Service Commission.
Findings Of Fact Betmar Utilities, Inc. is a private utility company who owns and holds Florida Public Service Commission Certificates Number 137W and No. 98S. These certificates grant Betmar the right to operate a water and wastewater system in a specified territory within an unincorporated area of Pasco County. Betmar seeks an extension of its certified territory into the areas immediately to the north and south in an unincorporated area of the county. There is, or will be in the near future, a need for water and wastewater services in the proposed amended territory. An Application for Amendment of Territory was filed with the Commission to allow Betmar to service the area on November 13, 1989. When Betmar noticed the City of its pending application, an objection was filed to the proposed expansion. The objection specifically relates to the property on the south side of Geiger Road, which extends 330 feet south of the roadway, and adjoins the City's boundaries. Although the City does not currently provide services to this locale, it does own water and sewer lines on the northern side of Geiger Road in the Silver Oaks area. Other water and sewer lines in the City's system extend below the south side of Geiger Road at the far eastern portion of the area for which Betmar is seeking the extension of territory. In an interlocal agreement between the City and the County dated February 9, 1988, these governmental entities established designated service areas for water and wastewater services in this particular area of the county. The purpose of the agreement was to promote the economic delivery of services to citizens in the area, and to provide for the necessary long-range planning inherent in the provision of these services. Prior to the agreement, the County was authorized to provide the services to the areas for which an extension is sought by Betmar. The service area boundaries delineated in the agreement were to be periodically reviewed in conjunction with the review of each party's respective comprehensive plans. Pursuant to this agreement, the City and County determined that the City's Service Area Boundry would include the area south of Geiger Road that abuts Betmar's current service area. The City and the County each relied upon this interlocal agreement in the creation of their respective comprehensive plans. However, no additional action has been taken by the City to service the area. The City is not actually operating within the disputed area for a number of reasons. First of all, the City has adopted an ordinance which requires annexation of contiguous property as a condition of receiving its water and sewer services. The disputed portion of the proposed amended territory is not within the city limits and has not been annexed. Secondly, the City is not prepared to build utility lines to service the disputed proposed amended territory until the new bypass road along Geiger Road is built, and the proper right-of-way is obtained. At that time, the City would like to extend the Silver Oaks line under Geiger Road to the south, and the line along the eastern side of the disputed portion of territory to the west. These anticipated expansions correlate with the City's Service Area Boundry in the interlocal agreement which remains unchanged between the City and the County. A proposed service date was not provided by the City at the formal hearing. The City seeks to control land use and development of property along the Geiger Road corridor though its ability to provide or withhold utility services. Betmar also has water and sewer lines abutting or located on all properties described in its application for extension, including the area in controversy. These lines are currently active due to Betmar's water and sewer system which is in the center of the area targeted for expansion. Both Betmar and the City have the technical and financial ability to provide water and wastewater services in the proposed amended territory. Betmar has a tariff approved by the Commission which allows it to charge 110% of the cost of the extension of service from its existing lines to any property seeking service. Owners of property abutting Geiger Road have contacted Betmar about the possibility of providing service. A formal request for service has been made by Jake Developers for service in that area. Betmar's sewage collection facilities abutting the Geiger Road property are gravity lines. The City's sewage collection facilities in close proximity to the area are force mains. Betmar does not charge impact fees for connection into its system. The City charges a water impact fee of $350.00 and a sewer impact fee of $1,278.00 for connection into its system. Betmar anticipates a reduction in water and sewer rates if the extension is approved. Betmar presented no evidence about plans for further financial investment which would enable the utility to provide service in the area for which the extension has been requested because Betmar believes further investment is unnecessary. Betmar has an agreement with the County that states the County will provide bulk wastewater treatment to Betmar for the purpose of offering centralized wastewater services from the County's Southeast Subregional Wastewater Treatment Plant for a twenty-five year term. The County has placed a possible qualification on the term of years in the agreement by inserting the following clause: ... its first responsibility is to the customers inside its own service limits and that it reserves the right to act in the best interest of those customers in all circumstances. The agreement between the County and Betmar has not been approved by the Commission.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: The Commission should deny Betmar's application for an amendment to its certified territory in Pasco County as the applicant has failed to provide that it will be allowed the continued use of the County's Southeast Subregional Wastewater Treatment Plant for the twenty-five year term set forth in the agreement presented at hearing. DONE and ENTERED this 16th day of July, 1991, in Tallahassee, Leon County, Florida. VERONICA E. DONNELLY 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 16th day of July 1991. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact are addressed as follows: 1. Accepted. See HO #2. 2. Accepted. See HO #1. 3. Accepted. See HO #3. 4. Accepted. See HO #11. 5. Accepted. See HO #4. 6. Accepted. See HO #9. 7. Accepted. See HO #11. 8. Accepted. See HO #13. 9. Accepted. See HO #14. 10. Accepted. See HO #9. 11. Accepted. See HO #9. 12. Accepted. See HO #11. 13. Accepted. Rejected. Improper legal conclusion. Accepted. See HO #5. Accepted. See HO #8. Accepted. See HO #14. Accepted. See HO #14. Accepted. Accepted. Accepted. Accepted. Accepted. See HO #15. Accepted. See HO #15. Accepted. See HO #16. Rejected. Improper legal conclusion. See HO #17. Accepted. See Preliminary Statement. Respondent's proposed findings of fact are addressed as follows: Accepted. See Preliminary Statement. Accepted. See Preliminary Statement. Accepted that an interlocal agreement between City and county existed. See HO #5. The rest of the paragraph is rejected as legal argument. Intervenor's proposed findings of fact are addressed as follows: 1. Accepted. See HO #2. 2. Accepted. See HO #12. 3. Accepted. See HO #12. 4. Accepted. See HO #3. 5. Accepted. See HO #11. 6. Accepted. See HO #4. 7. Accepted. See HO #12. 8. Accepted. See HO #9. 9. Accepted. See HO #9. 10. Accepted. See HO #9. 11. Accepted. See HO #5. COPIES FURNISHED: Scott L. Knox, Esquire 28870 U.S. Highway 19 North Suite 230 Clearwater, Florida 34621 Thomas P. McAlvanah, Esquire 37818 Highway 54 West Zephyrhills, Florida 34248 Robert J. Pierson, Esquire Florida Public Service Commission 101 East Gaines Street Tallahassee, Florida 32399-0863 David Swafford, Executive Director Florida Public Service Commission 106 Fletcher Building 101 East Gaines Street Tallahassee, Florida 32399-0850 Steve Tribble, Director Records and Recording Florida Public Service Commission 101 East Gaines Street Tallahassee, Florida 32399 Susan Clark, General Counsel Florida Public Service Commission 212 Fletcher Building 101 East Gaines Street Tallahassee, Florida
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: The Tamaron wastewater treatment facility (facility), located at 3800 Gatewood Drive, Sarasota, Florida, serves the Tamaron residential subdivision which was originally developed by U. S. Homes Corporation in 1976. The subdivision presently consists of 499 homes and was completely built out in the mid-1980's. The facility was originally owned and operated by U. S. Homes Corporation. Tamaron Utilities, a nonprofit entity comprised of the 499 homeowners, acquired the facility in November, 1987. At that time, the facility's existing operating permit was transferred to Tamaron Utilities. The facility is overseen by an elected board of volunteer homeowners. The Department is the agency of the State of Florida that is authorized to regulate domestic wastewater treatment and disposal facilities and permit their construction and operation. It is the successor agency to the Department of Environmental Regulation. By letter dated November 10, 1987, the Department notified Tamaron of the requirements of Chapter 87-303, Laws of Florida (Grizzle-Figg Amendment), which amended Section 403.086, Florida Statutes, and of the Department's intention to modify Tamaron's operating permit to incorporate a schedule of compliance with Section 403.086, Florida Statutes, as amended by Chapter 87-303, Laws of Florida. On August 23, 1988, an operating permit (D058-141783), which contained secondary water treatment requirements, was issued to the facility. Specific condition 7 of the permit required that the facility be in compliance with the Grizzle-Figg Amendment by October, 1990, or eliminate discharge to surface waters. On September 5, 1990, Tamaron filed an application with the Department to renew its domestic waste water treatment and disposal systems operation permit. Tamaron did not consider its facility as discharging waste into one of the specifically named water bodies set forth in the Grizzle-Figg Amendment or to "water tributary thereto" and thereby required to meet the advanced waste treatment criteria set forth in the Grizzle-Figg Amendment. However, in an abundance of caution, Tamaron proceeded to bring its facility into compliance with the advanced waste treatment criteria as set forth in the Grizzle-Figg Amendment. After numerous requests for additional information and several meetings between Tamaron and the Department, the Department issued its Notice of Permit Denial on April 9, 1991, asserting that Tamaron had not provided: (a) reasonable assurance that the requirements of Section 403.086(1)(c), Florida Statutes, mandating advanced waste treatment (AWT) before discharge to certain designated surface waters, would be met and; (b) reasonable assurance that the discharge to those certain designated surface waters would result in minimal negative impact as required by Section 403.086(5)(a), Florida Statutes. The facility continues to operate under its secondary treatment permit No. DO58-141783. The facility consists of a wastewater treatment plant designed for secondary treatment, with tertiary filtration. The design capacity of the facility is 155,000 gallons per day (0.155MGD) with actual flows of slightly over 100,000 gallons per day (0.100MGD+). Three percolation ponds surround the facility comprising the primary effluent disposal method for the facility. The Tamaron subdivision has a series of excavated surface water bodies (stormwater lakes), hydraulically connected, which eventually discharge at the northeast corner of the subdivision into Phillippi Creek. The direct path of surface water flow is from the subdivision's stormwater lakes to Phillippi Creek. These stormwater lakes are in multiple ownership. Under Department policy, stormwater systems permitted by the Department, its predecessor DER, or a water management district solely as stormwater treatment facilities under Chapter 17-25, Florida Administrative Code, are not considered "waters of the State". However, stormwater systems built prior to Chapter 17-25, Florida Administrative Code, permitting requirements, were considered "waters of the State" if they discharge more frequently than a twenty five year, twenty-four hour storm event. See Petitioner's exhibits 13 & 15. Tamaron's stormwater system was built prior to Chapter 17-25, Florida Administrative Code, permitting requirements, and was designed to discharge at a ten year, twenty-four hour storm event which is more frequent than a twenty five year, twenty-four hour storm event. Discharge of water into Phillippi Creek from the subdivision's stormwater lakes is fairly frequent; however, the volume of the discharge is low. Phillippi Creek is a natural surface water which eventually flows into Roberts Bay. Roberts Bay is a specifically named water body in the Grizzle-Figg Amendment (Section 403.086(1)(c), Florida Statutes). Since September, 1989, Tamaron has retained William Murchie, P.E. of AM Engineering, to evaluate the design and operation of the facility in order to comply with appropriate regulatory requirements. The facility provides biological treatment through a contact stabilization utilizing an activated sludge. This process typically provides high quality advanced secondary biological treatment. A chemical feed tank system utilizing ferrous sulfate was added to the facility several years ago to chemically precipitate out total phosphorus to meet the advanced waste treatment requirements. High-level disinfection is achieved in the large chlorine contact chamber and through two tertiary filters. At the design flow of 0.155MGD, the chlorine contact chamber provides nearly 80 minutes of contact time, while actual contact time for existing flows, not including time in filters, is calculated at 110 minutes. Upon leaving the chlorine contact chamber and the biological treatment components of the facility, the chlorinated effluent is directed through two tertiary filters to reduce the biochemical oxygen demand (BOD) and total suspended solids (TSS). After the tertiary filters, the effluent passes through the sample block where it is sampled for TSS, BOD and chlorine and is then piped sequentially into the first, second and third percolation ponds. The percolation ponds span two acres and provide residence time of 35 to 45 days, during which time the effluent is further biologically treated and nitrogen is reduced. From the percolation ponds, the effluent is pumped into a low pressure system which uniformly distributes effluent over two nitrogen reduction filters. The nitrogen reduction filters are located north of the plant and are immediately adjacent to one of the subdivision's stormwater lakes. The nitrogen reduction filters consist of deep sand beds covered with Bermuda grass to provide high nitrogen uptake. The irrigation of the two nitrogen reduction filters is alternated every half day. These nitrogen reduction systems were modified in October/November, 1990, by adding 3 to 3 1/2 feet of clean sand with a permeability rate of 28 feet per day, planting Bermuda grass, and installing an irrigation/distribution system. These filters replaced two sand pits with shallow layers of very coarse sand, after initial testing demonstrated the sand pits to be inadequate in removing nutrients consistent with statutory requirements. In January, 1992, an underdrain system utilizing perforated pipe was installed in the nitrogen reduction filters to create an aerobic zone and to provide a representative sample port after nutrient reduction in the filters. This sample port, used for the biweekly monitoring, consists of a single solid pipe, that collects effluent from the perforated pipes, with a tap to prevent discharge into the adjacent stormwater lake, except during sampling events. The biweekly sampling event results in effluent being discharged from the pipe for approximately 30 minutes to flush the pipe so as to get a proper sample. The underdrain sampling port at the nitrogen reduction filters replaced two earlier monitor wells between the nitrogen reduction filter and the stormwater pond, which proved ineffective because of their location. The perforated underdrains are situated in filter bed sand of medium grain size with a permeability rate 100 feet per day and located below 3 - 3 1/2 feet of clean sand with a permeability rate of 28 feet per day and above very permeable layers of sand, stone and coarse shell. (See Tamaron's exhibit 23 and Department's exhibit 14) The very permeable layers of sand, coarse shell, the perforated pipe and the single solid pipe are all located above the ground water table. Since the perforated pipe and sample port are both located above the ground water level and the surface of the adjacent stormwater lake, it is unlikely that the effluent sample taken from the sample port would be influenced by the ground water or a back flow of water from the adjacent stormwater lake. The coarse shell layer situated below the nitrogen reduction filters extends to the edge of the adjacent stormwater lake. Therefore, the effluent, other than the effluent trapped in the perforated pipe and carried to the sample port, that is irrigated onto the nitrogen reduction filters passes through the sand and into the coarse shell layer. The effluent is then transported laterally through the coarse shell layer to the underground edge of the adjacent stormwater lake where there is a subsurface discharge into the adjacent stormwater lake. Since the discharge to the stormwater lakes is primarily subsurface in nature, the logical compliance point to measure effluent parameters would be the underground sample port which collects the effluent prior to subsurface discharge into the stormwater lake. See Petitioner's exhibit 15. The direction of ground water flow at the facility is towards the north to the adjacent stormwater lakes as evidenced by the hydraulic gradient of the site determined using ground water table elevations. The location for sampling effluent from the facility for compliance with secondary standards was described in Specific Condition 5 of Tamaron's previous permit No. D058-141783 dated August 23, 1988. Specific Condition 5 states that the discharge from the chlorine contact chamber shall be sampled in accordance with Chapter 17-19, Florida Administrative Code, (now Chapter 17-601, Florida Administrative Code), for compliance with the stated secondary limits. The facility's tertiary filters are located after the chlorine contact chamber. Tamaron samples effluent for compliance with secondary standards (BOD,TSS, chlorine) at the sampling box after disinfection and tertiary filtration. Tertiary filtration is designed to achieve a more efficient removal of TSS and BOD. The resulting effluent is usually of higher quality than secondarily treated effluent. A secondary plant with tertiary filtration is referred to as an "advanced secondary treatment" plant. Data presented by Tamaron titled Tamaron 1991-1993 Data On FDER Permit Compliance (Tamaron's exhibit 17, page 1 of 2) shows reported values, sampled after tertiary filtration at the sample box, which suggest that secondary treatment parameters, including fecal coliform, are not being exceeded. The data actually shows a very high removal rate for the parameters sampled. The United States Environmental Protection Agency issued a National Pollutant Discharge Elimination System (NPDES) permit, number FL0042811, to Tamaron for the facility with an effective date of June 1, 1991, which authorized Tamaron to discharge from the facility to the receiving waters named Phillippi Creek to Roberts Bay in accordance with the effluent limitation, monitoring requirements and other conditions set forth in the permit. Since the facility was located in the Grizzle-Figg Amendment area of Florida certain changes were made from the draft permit to the final permit. Those changes appear in the Amendment To The Statement Of Basis At The Time Of Final Permit Issuance which is made a part of the final permit. The amendment provides for changes in Part I, Effluent Limitations and Monitoring Requirements. These changes, among other things, require that the Grizzle-Figg Amendment annual limits of 5 mg/l BOD, 5mg/l TSS, 3mg/l total nitrogen and 1mg/l total phosphorus be added to the effluent limits to adequately maintain water quality standards, and added monitoring requirements and measurement frequency regulations to give the basis for permit limits and conditions in accordance with Chapters 17-302, 17-600 and 17-601, Florida Administrative Code. Data presented by Tamaron titled Tamaron 1991-1993 Data On NPDES Permit Compliance (Tamaron's exhibit 17, page 2 of 2) show reported values sampled after nitrogen reduction filters which suggest that the maximum values for AWT parameters, including fecal coliform, are not being exceeded, particularly after January, 1992, when Tamaron began sampling effluent collected by the perforated underdrains at the sample port. Tamaron has been monitoring and reporting compliance under its final NPDES permit and providing copies to the Department. There was no evidence that Tamaron was ever in violation of its NPDES permit. Tamaron submitted documentation to the Department with its permit application that demonstrated high-level disinfection within the facility was being achieved. However, TSS was being sampled after the application of the disinfectant. Using this procedure, the facility continued to achieve high- level disinfection until the permit denial. After the permit denial, the facility resumed basic disinfection which was required under Tamaron's permit for secondary treatment. This same data indicates that there was compliance with the requirements for fecal coliform. The record is not clear as to the frequency and number of samples taken to provide the data for reporting compliance with the NPDES permit and the data presented in Petitioner's exhibit 17, page 2 of 2. However, there was no evidence, other than sampling for TSS after the disinfectant was added, that Tamaron was not complying with its NPDES Permit that required, among other things, that the monitoring requirements and measurement frequency of the Department's rules and regulations be followed by Tamaron. Tamaron has modified and upgraded the facility in order to achieve a treatment process which will produce effluent of a quality for discharge under the Grizzle-Figg Amendment. Tamaron has provided reasonable assurances, although not absolute assurance, that the facility can comply with the discharge permit requirements of Chapter 403, Florida Statutes, including Section 403.086, Florida Statutes, notwithstanding the testimony of Jay Thabaraj to the contrary concerning Tamaron's sampling technique and its method of obtaining high-level disinfection which can be addressed as a specific condition, if necessary. Studies conducted by the Tamaron's engineer included in Petitioner's exhibit 21 indicates that there was no adverse impact to the stormwater lakes from the facility's wastewater treatment and disposal system. Tamaron has provided reasonable assurances that the point of discharge is a reasonably access point, where such discharge results only in minimal negative impact.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a final order granting Tamaron an operating permit for its facility as secondary treatment facility. In the alternative, that the Department enter a final order granting Tamaron an operating permit for its facility that requires compliance with the advanced waste treatment criteria set forth in Section 403.086(4), Florida Statutes, that, in addition to any general or specific conditions that are normally required, contains specific conditions that: (a) contains specific instructions on sampling technique, sampling frequency and reporting as set forth in Rule 17- 740(1)(b)2., Florida Administrative Code, and (b) sets forth compliance with high-level disinfection, with a time limit for compliance, that accomplishes the intent of the rule, if not the strict letter of the rule, without total redesign of the facility. DONE AND ENTERED this 3rd day of May, 1994, in Tallahassee, Florida. WILLIAM R. CAVE 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 3rd day of May, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-2968 The following constitutes my specific rulings, pursuant to Section 120.59(2), Florida Statutes, on all of the proposed findings of fact submitted by the parties in this case. Petitioner, Tamaron's Proposed Findings of Fact: The following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding(s) of Fact which so adopts the proposed finding(s) of fact: 1(1); 2(2); 3(3); 4(5,6); 5(6); 6(7); 8(12); 10(8); 11-12(13-25,38); 13(31-34); 14(8); 15(13); 16(14); 17-18(15); 19(36); 20(16); 21(17); 22(18); 23(19); 24(20); 25(21);26(22); 32(32,7); 33(33); 34(32,32); 36(31); 39-40(34); 41(36); 42- 43(34); 44(35); 47(4); and 51(10). Proposed findings of fact 27-31, and 35 are conclusions of law rather than findings of fact.. Proposed findings of fact 45, 46, 48-50, 56, 57, 59, and 61-72 are arguments rather than findings of fact. Proposed findings of fact 7, 9, 37, 38, 52-55, 58 and 60 are neither material nor relevant. Respondent, Department's Proposed Findings of Fact: The following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding(s) of Fact which so adopts the proposed finding(s) of fact: 1(1,6); 2(2); 3(4,10); 5(9); 6(9,10); 8(11); 9-17(18-27); 18(8); 19(13); 20(5); 21(17); 22(30); 23(31); 24(14); 25(17); 26(18-23); 27(34); and 32(35,38). Proposed finding of fact 4 is neither material nor relevant but see Findings of Fact 18-25. Proposed findings of fact 7, 31 and 33 are arguments rather than findings of fact. Proposed findings of fact 28-30 are conclusions of law rather than findings of fact. COPIES FURNISHED: Virginia B. Wetherell, Secretary Department of Environmental Protection Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400 Kenneth Plante, General Counsel Department of Environmental Protection Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400 Charles G. Stephens, Esquire C. Robinson Hall, Esquire Enterprise Plaza, Suite 1516 101 E. Kennedy Blvd. Tampa, Florida 33602 Francine Ffolkes, Esquire Office of General Counsel Department of Environmental Protection Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32399-2400
The Issue The issues are whether Respondent's facility is a public water system subject to regulation by the Department of Environmental Regulation (DER) pursuant to Chapter 17-22, Florida Administrative Code, or whether it is exempt from those regulations by virtue of Rule 17-22.102 if the facility is subject to regulation by DER, whether Respondent should take the corrective actions set forth in the Notice of Violation and Orders for Corrective Action and should pay DER's expenses incurred in the pursuit of this case. DER presented the testimony of Cliff McKeown, a potable water engineer, and Linda Frohock, planning manager for the Department of Community Affairs (DCA). DER had Exhibits 1-4 admitted into evidence. Respondent, Lex Thompson, presented his own testimony and that of Hugh Kelly. The parties have submitted Proposed Findings of Fact and Conclusions of Law. They have been considered and a ruling has been made on each proposed finding of fact in the Appendix to this Recommended Order.
Findings Of Fact DER is the Florida administrative agency which has the authority to administer and enforce the provisions of the Florida Safe Water Drinking Act, and the rules and regulations promulgated thereunder. (See Prehearing Stipulation). Respondent is a natural person and citizen of the State of Florida. Respondent owns and is responsible for the construction of a potable water distribution main extension ("the facility") which serves a subdivision known as High Bluff Acres-near the community of Midway in Gadsden County, Florida. (See Prehearing Stipulation). On February 1, 1980, Respondent was issued construction permit number DS20-27385 for the facility. The construction permit described the facility as a potable water distribution main extension to the Talquin Electric Company's Midway water- system. The project was to be constructed with approximately 940 linear feet of four inch PVC valves and appurtenances. Specific condition number 15 of the permit restricted operation of the extension until department approval was issued. This approval would be granted upon receipt of certification by the engineer of record as to construction in accordance with the approved plans and specifications and receipt of two satisfactory bacteriological analyses. DER has not received this information and had not issued an approval for use of the facility. The construction permit expired on September 1, 1981. (See Prehearing Stipulation). Respondent modified the facility by constructing it with 550 feet of one inch to one and one-half inch PVC water mains. (See Prehearing Stipulation). DER conducted an inspection of the facility on February 23, 1982. The facility was found to be in use without final DER approval. By letter dated February 26, 1982, DER notified Respondent of his non-compliance with Chapter 17-22, Florida Administrative Code, and requested Respondent to submit specified compliance items. (See Prehearing Stipulation). In October of 1982, DER personnel contacted Respondent . by telephone. Respondent agreed to obtain a permit renewal and modify the unauthorized water line as soon as funds in the form of rent were released by the Department of Community Affairs (DCA). On November 1, 1982, DCA notified DER that payments were being made. (See Prehearing Stipulation). On June 8, 1983, DER notified Respondent of his non- compliance with Chapter 17-22, Florida Administrative Code, and requested a reply on actions to be taken to correct the deficiency. By letters dated October 18, 1984, and December 17, 1984, DER notified Respondent that the facility was not approved for use. Respondent was further requested to inform DER as to the status of the facility. DER received no response to these requests. (See Prehearing Stipulation). The facility was not constructed in accordance with DER-approved plans, and DER has issued no written approval or consent for alterations to the system. (See Prehearing Stipulation). Respondent placed the facility in service without submitting a certification of completion and a copy of satisfactory bacteriological results to DER for approval and clearance. (See Prehearing Stipulation). The facility is not designed to provide maximum hourly system demand without development of distribution pressure lower than 20 psi. (See Prehearing Stipulation). DER has incurred costs and expenses in the pursuit of this case in the amount of $453.50. (See Prehearing Stipulation). Respondent's facility consists of distribution and storage facilities only and does not have any collection or treatment facilities. It obtains all its water from and is not owned or operated by the Talquin Electric System. Further, Respondent is not a carrier which conveys passengers in interstate commerce. (See Prehearing Stipulation) The public water distribution system constructed by Respondent is connected to twenty dwelling units in twelve structures. The High Bluff Acres subdivision is a government- subsidized, but privately-owned, low-income housing development, wherein DCA, acting on behalf of the U.S. Department of Housing and Urban Development (HUD), subsidizes the payment of rent for the housing. Respondent entered into several agreements on behalf of Salter, Stephens and Thompson, with the DCA to rehabilitate existing structures at High Bluff Acres and thus qualify for the Section 8 Moderate Rehabilitation Housing Assistance Program (HAP) established by HUD. The purpose for entering into the HAP contracts is to provide low cost housing to low income persons. These agreements were entered into over a period of several months during 1981 and 1982. Upon satisfactory completion of the rehabilitation pursuant to the agreements, Respondent entered into a HAP contract for each structure in High Bluff Acres, for a total of twelve structures (20 dwelling units). The HAP contract establishes the contract rent that can be allowed for each individual dwelling unit in a structure (the contract covers one structure). The contract rent is calculated according to a formula established by HUD for such purposes, and includes monetary allowances for utilities or other services which are provided by the owner. It does allow the lessor to recover his capital expenses in rehabilitating an individual housing unit. DER Exhibits 3 and 4 are two of the twelve HAP contracts entered into by the Department of Community Affairs and Respondent, Lex Thompson. Each of these contracts has an Exhibit B which is entitled "statement of services, maintenance and , utilities to be provided by owner." These exhibits show that Respondent has agreed to provide water to the units under the HAP contract. Contract rents paid to Respondent as authorized agent for the partnership include an allocation of money to reimburse Respondent for providing water to the tenants in the dwelling units. However, subsequent to Thompson's and DCA's entering into the contracts for payment of these rental subsidies, Respondent notified DCA that he had incurred additional capital expenses. Since his rental payments were already at the maximum allowable rate, however, Respondent did not seek to modify the aforementioned contracts because the amendment would not result in any greater payment of monies to him. At no time has Respondent amended the terms of the HAP contracts with respect to provision of water to the tenants at High Bluff Acres. He is still receiving the reimbursement for provision of water to tenants. The general partnership which had been receiving contract rents for the dwelling units was dissolved in May, 1985, and the contracts for each structure were assigned to various individuals. Respondent, individually, owns one structure and his wife owns another. DER has received no potable water quality or quantity complaints regarding the High Bluff Acres subdivision. Moreover, the potable water system existing in the High Bluff Acres subdivision does not constitute a present threat to the public health, safety, and welfare.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Environmental Regulation enter a Final Order and therein order the following corrective actions: That within 45 days, Respondent shall hire an engineer registered in Florida to design a new distribution system for High Bluff Acres or modifications to the existing system, and submit a completed application to the Department for a permit to construct or modify the system. That within 60 days of issuance of the permit, Respondent shall have the distribution system installed, tested(including pressure testing, bacterial testing, disinfectant-testing) and shall have the engineer sign and seal the plans indicating to the Department that the system conforms with the approved plans, and both DER and American Water Works Association standards. It is further RECOMMENDED that Respondent be ordered to pay the Department's costs and expenses in the amount of $453.50, and that same be paid to the Department by cashier's check within 30days. DONE and ORDERED this 4th day of November, 1985, in Tallahassee, Florida. DIANE K. KIESL1NG Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of November, 1985 APPENDIX Rulings on Petitioner's Proposed Findings of Fact: Proposed Finding of Fact 1 is adopted in substance (See Finding of Fact 13). Proposed Finding of Fact 2 is adopted in substance (See Finding of Fact 15). Proposed Finding of Fact 3 is adopted in substance (See Finding of Fact 15). Proposed Finding of Fact 4 is adopted in substance (See Finding of Fact 17). Proposed Finding of Fact 5 is adopted in substance (See Finding of Fact 18). Proposed Finding of Fact 6 is adopted in substance (See Finding of Fact 19). Proposed Finding of Fact 7 is adopted in substance (See Finding of Fact 22). Proposed Finding of Fact 8 is adopted in substance (See Finding of Fact 21). Rulings on Respondents Proposed Findings of Fact: Proposed Finding of Fact 1 is adopted in substance (See Finding of Fact 1). Proposed Finding of Fact 2 is adopted in substance (See Finding of Fact 2). Proposed Finding of Fact 3 is adopted in substance (See Finding of Fact 3). Proposed Finding of Fact 4, first sentence, is adopted in substance (See Finding of Fact 4). The second sentence is rejected as being unsupported by the evidence and irrelevant. Proposed Finding of Fact 5 is adopted in substance (See Finding of Fact 5). Proposed Finding of Fact 6 is adopted in substance (See Finding of Fact 6). Proposed Finding of Fact 7 is adopted in substance (See Finding of Fact 7). Proposed Finding of Fact 8, first sentence, is adopted in substance (See Finding of Fact 8). The remainder of Proposed Finding of Fact 8 is rejected as irrelevant. Proposed Finding of Fact 9 is adopted in substance (See Finding of Fact 12). Proposed Finding of Fact 10 is adopted in substance (See Finding of Fact 14). Proposed Finding of Fact 11 is adopted in substance (See Finding of Facts 19 and 20). Proposed Finding of Fact 12 is rejected as unsupported by the evidence, irrelevant and conclusory. Proposed Finding of Fact 13 is adopted in substance (See Finding of Fact 23), except that it is rejected as it relates to a potential threat because that portion is unsupported by the competent, credible evidence. COPIES FURNISHED: Clare E. Gray, Esquire Daniel H. Thompson, Esquire Department of Environmental Regulation Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32301 William L. Hyde, Esquire 300 East Park Avenue Post Office Drawer 11300 Tallahassee, Florida 32302 Victoria Tschinkel Secretary Twin Towers Office Building 2600 Blair Stone Road Tallahassee, Florida 32301
The Issue The issue is whether Tampa Bay Water's award of a contract to Commerce Controls, Inc. to furnish control panel fabrications for a regional water treatment plant under Contract No. 2001-22 was contrary to competition, arbitrary, or capricious, as alleged by Petitioner.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Background In this bid dispute, Petitioner, Universal Precision Industries, Inc. (UPI), contends that Respondent, Tampa Bay Water, acted contrary to competition and in an arbitrary and capricious manner when it proposed to award a contract to Intervenor, Commerce Controls, Inc. (CCI), the lowest responsive bidder. In its petition, UPI alleged that CCI failed to include in its bid documents "catalog cuts and information with complete model number, manufacturer's specifications, and dimension drawings describing the proposed component," as required by the specifications. As further clarified at hearing, UPI alleged that CCI deviated from the specifications in a material respect by submitting a price for a "customized-made panel" instead of a higher costing Hoffman panel (encloser), and by submitting prices for a mix of AC/DC surge protectors rather than 100 percent DC surge protectors. All other allegations in the petition have been abandoned. UPI goes on to contend that by CCI pricing out the two items in this manner, CCI gained a competitive advantage of around $36,000.00 over UPI. Tampa Bay Water is a regional water supply authority created and existing pursuant to Sections 163.01, 373.1962, and 373.1963, Florida Statutes, and an interlocal agreement among Pinellas, Pasco, and Hillsborough Counties and the Cities of Tampa, New Port Richey, and St. Petersburg known as the "Amended and Restated Interlocal Agreement Reorganizing the West Coast Regional Water Supply Authority," dated June 10, 1998. In all, Tampa Bay Water is responsible for meeting the potable water needs of approximately two million customers. The controversy began on January 8, 2001, when Tampa Bay Water issued an Invitation for Sealed Bids for Contract No. 2001-22 for the fabrication of certain control panels and associated parts for a regional water treatment plant. In paragraph 2 of the Instructions to Bidders, Tampa Bay Water specifically reserved the right "to waive any and all minor irregularities and technicalities." A mandatory pre-bid conference was held on January 23, 2001. Representatives of UPI, CCI, and Intervenor, Tampa Armature Works, Inc. (TAW), attended the conference and later submitted bids. Thereafter, the sealed bids were opened publicly on January 30, 2001. CCI submitted the lowest bid ($469,481.00), TAW the second lowest bid ($486,144.00), while UPI submitted the third lowest bid ($495,000.00). On February 5, 2001, Respondent announced its intention to award the contract to CCI, who submitted the lowest responsive bid. After efforts to informally resolve the dispute were unsuccessful, this action was filed. The bid documents The Instructions to Bidders required that "[q]uotations for services are to be provided on the Bid Schedule included herein." They further provided that "[p]roposals must be provided on the Bid Schedule included with the contract documents." The Bid Schedule form in the bid documents provided fourteen line items to be completed by the bidders: one line each for each of the seven control panels and one line each for the factory acceptance testing on each panel. The Bid Schedule also provided a pre-determined Owner's Allowance and then a "Total Contract Price" line for the fifteen line items. The Instructions to Bidders further required that "[a]ll quotations must reflect delivered cost which includes all packing, handling, shipping charges, taxes, discounts and delivery to Tampa Bay Water." In a section of the "Conditions of the Contract," the following requirements were imposed: The proposal shall include the following: Catalog cuts and information with complete model number, manufacturer's specifications, and dimension drawings describing the proposed components. Total cost to Owner of all components including a separately itemized freight cost to the project site. Per diem costs, expenses included, for supplying an experienced representative to the project site to assist with startup and operator training. Delivery time of all panels following receipt of purchase order. In the same section of the bid documents, under a heading entitled "Qualifications of Bidders," there is found a requirement that "[t]he Unit Control Panels shall be bid in detail, depicting a base unit price per device, utilizing an Excel spreadsheet supplied to the bidder." Finally, the bid documents contained seven spreadsheets, one for each of the panels, which set forth by line item a description of each component, its function, the manufacturer's name and model number, and the quantity required. The last column of each spreadsheet was blank and was titled "Costs." The purpose of a bidder submitting spreadsheets was to ensure that Tampa Bay Water was getting the specific components identified in those spreadsheets. Therefore, Tampa Bay Water wanted to ensure that the bidder was furnishing the parts specified, but it was not concerned with the manner in which a bidder may have priced any particular components. The specifications also called for a number of surge protectors for each of the seven panels. However, they did not specify whether the protectors would be AC or DC, or the number of each. Because there is a significant difference in price between the two, a few days before the bids were to be submitted, a UPI employee, Frank Dressel, made a telephonic inquiry with James L. Hall, an outside consultant who assisted in the preparation of the specifications, seeking clarification. Hall advised Dressel that he should price out his proposal using all DC surge protectors, even though the specifications were not clear on that point, and he was unsure of the exact number of DC surge devices that would ultimately be used. Hall later conveyed this same advice to all bidders before the bids were submitted. CCI's bid proposal CCI's bid proposal did not include the catalog cut sheets (product specification sheets) or the spreadsheets in its proposal. However, CCI provided a cover letter with its proposal which stated that The bid requirements asked for several items, for which there was no line on the bid form. This proposal addition serves to provide the additional information required. The equipment we are providing is the exact model as specified by Tampa Bay Water, therefore, we have not included the catalog cut sheets or major equipment listing with our bid. We can, if necessary, provide the information. Per diem expenses for an electrician for wiring field terminations to the control panels $336.00, based on an 8 hour day. Per diem expenses for a CCI start-up technician would be $900.00, based upon a 40 hour work week. Freight expenses are $7,000.00. After reading the letter, a Tampa Bay Water representative, Joseph Kehoe, "felt comfortable" with that statement and treated it as a representation by CCI that it would supply the exact parts specified by Tampa Bay Water. In an abundance of caution, however, Kehoe sought guidance from his General Counsel regarding the apparent irregularities in the CCI bid, as well as apparent irregularities in the second lowest bid submitted by TAW. The General Counsel advised that the irregularities appeared to be minor and could be waived, but that further clarification could be sought from the bidders with respect to any of the omitted information. Kehoe then sought clarification from CCI regarding the freight charges and delivery schedule. He also requested the spreadsheets and catalog cut sheets previously offered by CCI in its response. By letters dated February 2 and 5, and March 1, 2001, and a "Supplemental Information" submittal containing the spreadsheets and catalog sheets, CCI provided the necessary clarification. That information confirmed the accuracy of the representations in CCI's January 30, 2001, letter, which indicated that CCI would supply all of the required equipment at the price stated in its bid. UPI's concerns According to UPI's chief financial officer, John Sessa, CCI "did not provide pricing or part numbers to indicate that they were supplying" some of the items required by the specifications. More specifically, three of the seven panels required Hoffman enclosures. In reviewing the CCI proposal, Sessa could find no price quote for a Hoffman enclosure, but he did find a manufacturer's quote for a similar enclosure by another manufacturer, Thermal Designs and Manufacturing (TDM). Also, Sessa was unable to determine whether CCI's bid was based on all DC surge protectors. Therefore, Sessa concluded that CCI was not supplying the Hoffman enclosures or the required number of DC surge protectors. By CCI using lower costing parts in pricing out its bid, Sessa contended that CCI had obtained a competitive advantage over UPI. The prices used for CCI's bid were prepared by Karen R. Lawson, a sales engineer in CCI's Plymouth, Michigan office. Lawson gathered her estimates from catalogs and vendors and then submitted them to her supervisor, Jerry Zitterman, who in turn forwarded them to a CCI employee in St. Petersburg, Florida. Because she either gave the vendor an incorrect part number for a Hoffman panel, or there was a substantial lead time in obtaining such a unit, Lawson used a price for a customized panel made by TDM, and not the price for a Hoffman panel. That price, however, was later adjusted upward by more than 25 percent in the bid proposal, presumably to take into account the labor component. In pricing out the surge protectors, Lawson used an average unit price, which was derived by taking "both prices and [using] an average of those numbers." Notwithstanding the manner in which it had priced out the panel and surge protectors, CCI unequivocally agreed that it was obligated to supply all equipment specified by Tampa Bay Water by manufacturer and part number, and that was the intent of its January 30, 2001, letter included in its bid proposal. At the same time, Tampa Bay Water understood that CCI was supplying all of the items specified in the spreadsheets and that CCI would be held to its bid price as to all of the specified components. CCI's failure to supply the spreadsheets and catalog cut sheets at the time the bid proposal was submitted, and its manner of pricing out the required panels and surge protectors, were minor deviations from the specifications, did not give CCI a substantial advantage over other bidders, and did not adversely affect the interests of Tampa Bay Water. This is especially true here since CCI's bid proposal included a letter which indicated that CCI would provide all required equipment at the stated price. Under the terms of the Invitation for Sealed Bids, Tampa Bay Water properly waived the minor irregularities in order to achieve the purpose of securing the lowest responsible bid. UPI's bid proposal There were a number of irregularities in UPI's bid as well. For example, certain items in the spreadsheets had a dash instead of a price in the "Costs" column. UPI's bid proposal also failed to provide any information as to the per diem costs from an experienced representative to assist with start up and operator training. In addition, UPI changed the indicated quantities for each component in the spreadsheets from whatever Tampa Bay Water had specified to a quantity of one. Finally, as to two of the three different size fuses required for each of its panels, UPI's spreadsheet failed to list a price and showed a quantity of zero. A representative of Tampa Bay Water established that had UPI been the lowest bidder, the agency would have sought clarification from the bidder as to the above items in the same manner that it sought clarification from CCI. TAW's bid proposal TAW's bid also omitted the catalog cut sheets and the spreadsheets, and it failed to provide any information as to freight charges, per diem start up expenses, or delivery schedule. Clarification regarding these items would also have been required, had TAW submitted the lowest bid.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Tampa Bay Authority enter a final order awarding the contract to CCI, the lowest responsive bidder. DONE AND ENTERED this 4th day of May, 2001, in Tallahassee, Leon County, Florida. ___________________________________ DONALD R. ALEXANDER 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 4th day of May, 2001. COPIES FURNISHED: Donald D. Conn, General Counsel Tampa Bay Water 2535 Landmark Drive, Suite 211 Clearwater, Florida 33761-3930 Barrie S. Buenaventura, Esquire Tampa Bay Water 2535 Landmark Drive, Suite 211 Clearwater, Florida 33761-3930 Dominick J. Graziano, Esquire Bavol, Bush & Sisco, P.A. 100 South Ashley Street, Suite 2100 Tampa, Florida 33602-5311 Richard A. Harrison, Esquire Allen, Dell, Frank & Trinkle, P.A. Post Office Box 2111 Tampa, Florida 33601-2111 Steven D. Marlowe, Esquire Marlowe & McNabb, P.A. 324 South Hyde Park Avenue, Suite 210 Tampa, Florida 33606-4127 Michael M. MacInnis, Treasurer Tampa Armature Works, Inc. 440 South 78th Street Tampa, Florida 33619
Findings Of Fact Petitioner is a special taxing district providing fire protection and rescue services to the residents of the Estero area of Lee County. The fire station is located at 20241 Tamiami Trail, Estero, Florida. Petitioner employs 14 employees, including administrative staff and firefighters. The firefighters work 24 hours straight and then are off-duty for 48 hours. Two to four employees work each shift. Firefighting requires a fast response. Thus, Petitioner requires that on-duty firefighters remain at the station for their entire 24-hour shift, unless they are out fighting fires or performing rescue duties. The fire station contains an 8' x 13' bedroom with six mattresses located on three bunk beds. On-duty firefighters are allowed to bring pillows and sheets so they can sleep at the station while on duty. There are no dressers in the room, which contains small lockers that the firefighters may use to store a change of clothes. Petitioner provides kitchen facilities at the fire station and well water. The well water is used for washing equipment, taking showers, and flushing the toilet. The well water is not used for any other purposes, nor is it used by any other persons. Petitioner provides bottled water for drinking and cooking. All of the firefighters have residences apart from the fire station and within a reasonable commuting distance from the fire station. No firefighter has ever lived at the station. Petitioner does not charge, or reduce the pay of, the firefighters for their use of the limited sleeping facilities. Petitioner lawfully does not treat the use of the limited sleeping facilities by firefighters as gross income for the purposes of withholding federal income tax or making social security contributions. By letter dated July 18, 1995, Respondent informed Petitioner that the fire station's water system is a limited use community water system because the sleeping facilities constituted rental residences, as defined by Rule 10D- 4.024(21), Florida Administrative Code. Respondent advised Petitioner that it was therefore required to obtain a permit. As noted in the following section, the statute authorizes Respondent to regulate as limited use community public water systems those systems serving a certain number of "rental residences." The statute does not define "rental residence." In Rule 10D-4.024(21), Respondent defines a "rental residence" as follows: a dwelling unit, a structure or part of a structure that is rented for use, or furnished with or without rent as an incident of employ- ment, for use as a home, residence, sleeping place by one or more persons, a mobile home rented by a tenant. This term does not apply to facilities offering transient residency such as public lodging establishments. This term includes other facilities where residency or detention is incidental to the provision of medical, geriatric, educational, counseling, religious, or similar services. Respondent equated a "rental residence" with a "dwelling unit" when it based its definition of "rental residence" on the statutory definition of "dwelling unit" in Chapter 83, Part II, Florida Statutes, which is the Florida Residential Landlord and Tenant Act. A "dwelling unit" is a "residence." The American Heritage dictionary defines a "dwelling" as "a place to live in; residence; abode." Similarly, the same dictionary's first definition of "residence" is "the place in which one lives; a dwelling; an abode." But the statutory definition qualifies "residential" with "rental." The word "rental" requires consideration of the nature of the relationship of the occupant to the dwelling and its owner. Obviously, the Florida Residential Landlord and Tenant Act addresses rental transactions, but it does not do so in the definition of "dwelling unit." Other provisions of the Act describe the kind of activity that must take place for a person to be considered a tenant renting a dwelling unit. Most importantly, Section 83.43(6) defines "rent" as "periodic payments due the landlord from the tenant for occupancy under a rental agreement " The facts of this case present a revealing illustration of the distinction between a "residence" or "dwelling unit," on the one hand, and a "rental residence," on the other hand. There is no rental relationship between the occupants of the sleeping quarters at the fire station and the residence or dwelling itself. The firefighters do not pay, directly or indirectly, for these beds or the rooms in which the beds are located. Their employer legitimately does not include the value of the use of these sleeping quarters in the compensation paid to the firefighters. The firefighters have residences within commuting distance of the fire station and use the meager sleeping quarters and kitchen facilities only because they are required to spend long hours continuously at the fire station.
The Issue This is a procurement protest. The ultimate issue is whether the Respondent’s award of the "Agreement for the Construction and Operation of a Seawater Desalination Plant and Water Purchase Agreement" ("WPA") to Intervenor, S & W Water, LLC ("S&W") on July 19, 1999, is contrary to Tampa Bay Water's (TBW’s) governing statutes, its rules or policies, or the proposal specifications, or is clearly erroneous, contrary to competition, arbitrary, or capricious. Additional issues presented for decision are: (1) whether Petitioner has standing to maintain this protest; and (2) whether, by participating in the procurement process, Petitioner has waived or is estopped from claiming irregularities arising out of that process.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that TBW enter a Final Order denying Petitioner's Formal Protest. Jurisdiction is reserved for consideration of S&W's request for a determination of improper purpose under Section 120.595(1), Florida Statutes, if such request is made by motion within 10 days from the issuance of this Recommended Order. DONE AND ENTERED this 25th day of October, 1999, in Tallahassee, Leon County, Florida. J. LAWRENCE JOHNSTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 25th day of October, 1999. COPIES FURNISHED: Charles W. Pittman, Esquire 400 North Tampa Street Suite 1040 Tampa, Florida 33602 Richard A. Harrison, Esquire John W. Wilcox, Esquire Allen, Dell, Frank & Trinkle, P.A. Post Office Box 2111 Barnett Plaza, Suite 1240 101 E. Kennedy Boulevard Tampa, Florida 33601-2111 Donald D. Conn, General Counsel Tampa Bay Water 2535 Landmark Drive Suite 211 Clearwater, Florida 33761-3950 John H. Rains, III, Esquire Annis, Mitchell, Cockey, Edwards & Roehn, P.A. Post Office Box 3433 One Tampa City Center, Suite 2100 Tampa, Florida 33601
