The Issue The issue presented is whether Respondent, S.M.G., Inc. (SMG), has provided reasonable assurance that its existing air curtain incinerator will be operated in accordance with applicable statutory and rule provisions.
Findings Of Fact The Parties The Department is the state agency responsible for receiving applications for, and the issuance of, permits for the construction and operation of air curtain incinerators in the State of Florida. SMG is a contracting company, with residential, trucking, agricultural, and commercial driver's license divisions. SMG is the applicant for a permit to operate an air curtain incinerator. Petitioners reside in Citrus County, Florida, in the vicinity of the constructed and operational air curtain incinerator. For the most part, Petitioners reside northeast, east, or southeast of the site. The Petitioners demonstrated their standing in this proceeding. SMG's Construction Permit On May 23, 2001, SMG submitted an application for an air construction permit to the Department's Southwest District Office. The application sought authorization to construct an air curtain incinerator "[o]n the east or west side of 6844 N. Citrus Avenue, Crystal River," Citrus County, Florida. 1 The general purpose of pursuing this permit was to burn wood waste. On July 9, 2001, the Department issued SMG a Notice of Intent to Issue the Proposed Air Construction Permit (Permit No. 0170360-001-AC). A copy of the Notice of Intent was published in the Citrus Times in Citrus County on July 19, 2001. On August 6, 2001, the Department issued SMG an air construction permit for the proposed air curtain incinerator. The construction permit authorized the construction of a McPherson Systems, Inc. - Model M30E air curtain destructor (incinerator) with under fire air at a natural non-Title V facility. Pursuant to the terms of the construction permit, in November 2001, SMG constructed an air curtain incinerator on approximately 500 acres of land on the east side of State Route 495 north of Crystal River in Citrus County, Florida, on property owned by the Gerrits family. See Endnote 1. Pursuant to the construction permit, SMG installed a McPherson Systems, Inc. - Model M30E air curtain incinerator with under fire air, a refractory lined burning pit, three upper chamber refractory lined walls (ten feet high), and a stainless steel spark arrester screen. The manifold blower and under fire air fans are powered by an electric engine. The manufacture designs and specifications for the McPherson model were submitted with the application for the air construction permit and admitted in evidence. Construction of a portable air curtain incinerator with a blower/fan system powered by a diesel-fired engine was contemplated by the air construction permit. Although cheaper, SMG instead chose to install the McPherson model that would produce the cleanest burn, i.e., one with fewer emissions, that was operated by electricity. The McPherson model used by SMG is recognized as an efficient, reliable model of air curtain incinerator. The diesel-fired blower/fan/engine system contemplated by the construction permit is considered exempt from permitting. An engine operated by electricity has no emissions and therefore does not require an air permit from the Department. The Department could not require a permit for the blower/fan system alone. The operating permit supercedes the construction permit, except as amended. Testing after Construction of the Incinerator On November 23, 2001, SMG began operating the air curtain incinerator. Pursuant to Special Condition 22 of the air construction permit, an initial visible emissions (VE) (opacity test) compliance test was performed on November 23, 2001, by Bernard A. Ball, Jr., an environmental engineer with Southern Environmental Services, Inc. The results of the initial VE compliance test were within the opacity limits contained in the construction permit. Specific Condition 19 of the construction permit requires SMG to maintain daily operating logs of the air curtain incinerator's daily operations. In order to obtain an air operating permit, a permit applicant is required to demonstrate compliance with the Department's rules and with the conditions of the construction permit. The Department requires an applicant for an operating permit to submit copies of recent daily operating records for the facility and copies of the emissions test required by the construction permit. These operating records are submitted in order for the Department to determine whether the applicant is complying with the applicable emissions standards and that the applicant is, in fact, maintaining the required operating logs as required by the construction permit. In order for SMG to obtain the operating permit for the incinerator, Specific Condition 28 of the construction permit required SMG to file an application for an air operating permit with the Department within 45 days of testing and required the application to include a copy of the VE test report and copies of at least two recent weeks of daily operating logs. On March 14, 2002, a second VE test was conducted by Mr. Ball, which also indicated that emissions were within the construction permit's opacity limits. On April 1, 2002, SMG submitted its application for the air operation permit to the Department. The application was signed by Sean Gerrits, and contained copies of the VE test reports for the November 2001 and March 2002 tests, as well as three and one-half months of daily operating logs, certificates showing that the incinerator operators were trained, and photographs of the incinerator in operation. SMG submitted the documentation required under the construction permit. On April 19, 2002, Robert E. Soich, Jr., air compliance inspector for the Department's Southwest District Office, performed an unannounced inspection and conducted a VE test in response to a complaint by Mr. Leonard Kaplan (a Petitioner), complaining of odors present. Excessive visible emissions were observed by Mr. Soich on April 19, 2002. The incinerator did not pass the VE test because of the improper alignment of the blade angle on the manifold of the blower system and because of green leaves and inadequate drying of the materials to be burned in the incinerator. Mr. Soich also observed, in part, that "materials need to be prepared better for burning." As a result of this unannounced inspection and the negative VE test, the Department requested SMG to provide an explanation of the VE test results and of the type of changes SMG planned to implement to correct the problem. On learning of the problem, SMG shut down the incinerator and called a McPherson mechanical contractor to come out and adjust the blade angle. Southern Environmental Services conducted another VE test to ensure the problem had been corrected. On April 22, 2002, a VE test was conducted by Southern Environmental Services on-site which showed compliance with the construction permit. On April 30, 2002, SMG advised the Department that adjustments were made to the baffles to correct the angles. SMG provided the Department with the April 22, 2002, VE test results. SMG also implemented better operational procedures. On May 30, 2002, with Mr. Soich present, SMG, by Byron E. Nelson, performed another VE test. The test results showed compliance with the opacity limits in the construction permit and the results were submitted to the Department.2 Mr. Nelson, an environmental engineer with Southern Environmental Sciences, testified that he has been involved in preparing approximately two dozen applications for air curtain incinerators and has conducted probably "thousands" of visible emissions tests. Mr. Nelson is certified by the State of Florida to conduct VE tests. He has seen "two or three dozen" air curtain incinerators in operation and has conducted VE tests on about 20 of them. Based on his experience, Mr. Nelson testified that SMG employed the same practices and controls to control odor, smoke, and fugitive emissions as other such incinerators he is familiar with. He testified that the amount of smoke and odors from the SMG incinerator is similar to that emitted from other air curtain incinerators, and that the fugitive emissions from the SMG incinerator were probably less than others he is familiar with. Based on his experience, Mr. Nelson opined that SMG has taken reasonable measures to minimize odor, smoke and dust/particulates from the operation of the incinerator. Mr. Nelson likewise opined that the SMG incinerator is well run, perhaps better run than other incinerators. (Mr. Nelson had been on the SMG site twice when the incinerator was operating and burning wood products.) Based on his experience, Mr. Nelson opined that SMG meets the requirements necessary to obtain an air operating permit from the Department and has demonstrated that it has complied with the conditions of its construction permit. Mr. Soich is the air compliance inspector for the Department's Southwest District Office. He testified that he has inspected the operations of other air curtain incinerators over the last 15 years. Mr. Soich testified that SMG is one of the "better operators" of air curtain incinerators he is familiar with. (Mr. Soich visited the SMG site approximately nine times from March 13, 2002, to October 15, 2002.) Mr. McDonald is the Air Permitting Engineer for the Southwest District Office of the Department. He is responsible for reviewing all applications for air curtain incinerators in the Southwest District and has reviewed applications for between 25 and 30 incinerators. Mr. McDonald reviewed the SMG permit applications. Based on the latest VE test results, copies of the records attached to the operating permit application, and his experience, Mr. McDonald, for the Department, determined that SMG had demonstrated compliance with the conditions of the construction permit and recommended issuance of the operating permit for the incinerator. He maintained the same position at hearing. SMG provided assurance that the DeRosa Fire Department would respond in the event of a fire at the incinerator. On June 19, 2002, the Department issued the proposed air operating permit. Operation of the Air Curtain Incinerator Emissions from the incinerator are controlled by a curtain of forced air at a very high static pressure over and around the burning pit. The air curtain traps smoke and small particles and recirculates them to enhance combustion and reduce smoke. The underfire air introduces air underneath the air curtain to ensure complete combustion and minimize opacity at start-up. The refractory-tiled ceramic concrete burn pit provides a safe combustion chamber, and the refractory panels keep excess heat from escaping. The upper chamber refractory panels, which surround three sides of the burn pit, allow more retention time in the burner to better control opacity and sparks. The stainless screen spark arrestor also controls sparks and debris from leaving the burner. The operating permit application proposed the use of an air curtain blower along with a manifold to provide forced air to the burning pit. According to the manufacturer specifications, the blower can force air into the pit at velocities of between 100 and 120 mph. This ensures that the flames in the burn pit receive enough oxygen to combust completely. The air circulates inside the burn pit to ensure a complete burn, which reduces smoke and odor. The combustion temperature for the burning pit ranges from approximately 1,800 to 2,500 degrees Fahrenheit. The operating permit allows a maximum charging rate of ten tons per hour on a daily average basis and 31,200 tons per any consecutive 12 month period. The incinerator has been operating below the maximum charging rate. The operating permit limits the hours of operation (charging) to 3,120 hours per year, i.e., ten hours/day, six days/week, 52 weeks/year. According to various SMG operating and maintenance logs, the incinerator has been operated below this limit. The operating permit, in accordance with Rule 62- 296.401(7), Florida Administrative Code, allows the burning of only wood waste, yard waste, and clean lumber, and prohibits the burning/incineration of materials such as sawdust, paper, trash, tires, garbage, rubber material, plastics, liquid wastes, Bunker C residual oil, roofing materials, tar, asphalt, railroad cross ties, or other creosoted lumber, chemically treated or painted wood, and other similar materials. Biological waste shall not be burned in the incinerator. During its operation, the incinerator only burned wood and yard waste, and Mr. Gerrits testified that the waste materials are inspected before being burned in order to ensure that no prohibited materials are burned. If any non-authorized materials are observed, they are removed before the waste is burned. See Finding of Fact 24. The operating permit allows visible emissions during start-up periods (not to exceed the first 30 minutes of operation) of an opacity up to 35 percent, averaged over a six- minute period, as provided for in Rule 62-296.401(7)(a)-(b), Florida Administrative Code. The McPherson model is designed to meet the requirements of the above-referenced rule, and the VE tests run during start-up periods (except one performed by Mr. Soich on April 19, 2002) demonstrated compliance with this requirement. Id. The operating permit limits visible emissions outside of start-up periods (the first 30 minutes of daily operation) to no more that five percent opacity, with visible emissions of up to ten percent opacity allowed up to three minutes in any one hour as provided for in Rule 62-296.401(7)(a), Florida Administrative Code, and 40 Code of Federal Regulations Part 60, Subpart CCCC, adopted and incorporated by reference in Rule 62- 204.800(8)(b)74, Florida Administrative Code. (Rule 62- 296.401(7)(a) permits up to 20 percent opacity. The ten percent rate is required by the new federal standard. See SMG Exhibit 13, page 3 of 9.) The opacity limits in the operating permit are more stringent than those contained in the construction permit, which allows visible emissions of up to 20 percent opacity up to three minutes in any one-hour period. (By definition, a "visible emission" is "[a]n emission greater than 5 percent opacity or 1/4 Ringelmann measured by standard methods." Rule 62-296.200(278), Florida Administrative Code.) The VE test results submitted by SMG demonstrate compliance with the opacity limits in the operating permit and with the opacity limits in the construction permit for the days tested. See Findings of Fact 18, 22, 27, and 29. The operating permit requires that the incinerator must be attended at all times while materials are being burned and that public access to the incinerator must be restricted. A certified operator is in attendance whenever the incinerator is operated, i.e., when something is burning in the incinerator. A fence has been constructed around the property. The operating permit prohibits starting the incinerator before sunrise and requires that all charging of the incinerator be completely stopped before sunset as required by Rule 62- 296.401(7)(h), Florida Administrative Code. Mr. Gerrits testified that the incinerator is never started before sunrise and is typically started after 8:00 a.m. Mr. Gerrits testified that the incinerator is never charged after sunset and that charging typically stops at 4:00 or 5:00 p.m. See Endnote 4. These practices are consistent with the Operations and Maintenance Guide for the incinerator. The operating permit limits the height of the ash in the burning pit to one-third of the depth of the pit or to a point where the ash begins to impede combustion, whichever occurs first as provided in Rule 62-296.401(7)(m), Florida Administrative Code. The one-third depth line is marked on the outside of the incinerator. Mr. Gerrits testified that ash is regularly removed from the burning pit every third day to keep the ash level low, which helps ensure better combustion and reduces smoke. The operating permit provides that material shall not be loaded into the incinerator in such a way that it will protrude above the air curtain. Testimony established that the SMG incinerator is properly loaded. The operating permit requires that all operators of the incinerator be trained in the proper operation and maintenance of the incinerator and that an operations and maintenance guide be maintained at the facility at all times. All of the operators of the SMG incinerator have taken a four-hour training course to learn how to operate the incinerator in accordance with Department regulations and good operating practices, and certificates attesting to that training were submitted with the application for the operating permit. An Operations and Maintenance Guide was submitted with the application for the construction permit. The operating permit requires the maintenance of a daily operating log. The daily operating log must be maintained at the facility for at least five years and must be available for inspection by the Department upon request. SMG currently maintains a daily operating log that meets the requirements of the construction permit. SMG submits those daily logs to the Department on a monthly basis after the Department requested that SMG do so. The log includes a date and site location, daily operating hours, total charges, total material charged in tons, average hourly charging rate, any maintenance performed, fuel usage in gallons, and the operator's signature. The logs of record contain this information and have been initialed by SMG's operator for each day when the incinerator has been operated. SMG operators responsible for preparing the logs have no incentive to indicate the incinerator is not operating on days or during hours when it is running, as a deliberate misstatement on the operating logs could result in enforcement action by the Department and being fired by SMG. The operating permit requires that all reasonable precautions be undertaken to prevent and control the generation of unconfined emissions of particulate matter in accordance with Rule 62-296.320(4)(c), Florida Administrative Code. SMG takes reasonable precautions to prevent and control the generation of unconfined emissions of particulate matter, including paving the road that leads to the incinerator to reduce dust, wetting the ashes removed from the burn pit, wetting the ash piles and ramp that addresses the incinerator, approaching the incinerator at a slow rate, and placing a charge into the incinerator slowly and carefully. SMG voluntarily added a sprinkler system on all four corners of the burning pit that was not contemplated by the construction permit. The Department witness Mr. McDonald testified that this provided an additional method to control unconfined emissions. Although the construction permit and proposed permit do not contain conditions prohibiting the burning of green wood or wet wood waste, SMG takes precautions at the request of Mr. Soich to ensure that the wood is properly dried before being burned. See Finding of Fact 24. This helps to reduce smoke and emissions from the incinerator. (Moisture is the primary factor that inhibits burning and causes smoke and potentially odor.) As part of the routine practice in handling the wood waste before it is burned, trucks bringing wood waste to the incinerator are instructed to dump it into a pile. SMG operators then use a loader to flatten out the pile and remove dirt, prohibited materials, and harvestable pieces of wood. Harvestable pieces of wood and dirt are removed to separate staging areas. The remaining wood waste is separated into long windrows, with the oldest row closest to the incinerator. The windrows are flipped or rolled over in the direction of the incinerator, allowing the waste to dry. The waste in the row closest to the incinerator is burned, and subsequent windrows are rolled over in its place. Ash is generally removed from the burn pit every third day; it is wetted on removal to reduce dust, and the ash piles adjacent to the incinerator are also kept wetted by the sprinkler system. The ash is eventually mixed with the dirt in a composter for use as Class-A unrestricted compost. The SMG operator in charge on a particular day decides whether the incinerator will operate that day, in accordance with standard operational practices. The operator checks the weather forecast. If it is raining or if there are high winds (over 20 miles per hour), the incinerator will not be operated that day, and SMG typically waits four days after a rain to begin operating the incinerator again. These procedures are not contained in any permit conditions. The purpose of not operating during or immediately after a rain and taking steps to ensure the wood is dry is to reduce smoke; wet wood smokes more. Rainy weather can also affect odor. The purpose of not operating during windy conditions is to reduce the possibility of fire on SMG's property, but wind can also affect odor and visible emissions. On days when the incinerator is not operating, SMG conducts yard maintenance, maintains the waste windrows, and runs the composter. The composter is a source of noise and is located adjacent to the incinerator and is run when the incinerator is shut down. To ensure that the visible emission limitations are not exceeded and objectionable odors3 not generated, the operating permit requires that the incinerator's fan shall continue to operate after the last charge of the day until all combustion (presence of any flame or smoke) has ceased. Generally, the incinerator keeps burning an hour to an hour and one-half. Mr. Gerrits testified that the fan is kept running until the flames and smoke die out and that a certified operator is present until the fan is switched off. The operating permit requires that the testing of visible emissions must be conducted within 90-100 percent of the maximum allowable charging rate of 10 tons/hour and shall be conducted when the highest emissions can reasonable be expected to occur.4 Testing of the SMG incinerator was conducted at within 90-100 percent of the maximum allowable charging rate of 10 tons per hour, and the May 30, 2002, test results indicated that the incinerator was operating within the opacity limits of its permit even when operating at close to maximum capacity. Evidence established that the May 30, 2002, VE test complied with the specific conditions of both the construction and operating permit. See Finding of Fact 29. The test method for visible emissions required by both the construction permit and the operating permit is EPA Method 9, adopted and incorporated by reference at Rule 62- 204.800(8)(b)74, Florida Administrative Code. (Method 22 is not required pursuant to Department rules for compliance testing of an air curtain incinerator.) Testimony established that Method 9 was the method used for the VE tests conducted on the SMG incinerator. As required by both the construction and operating permits, the incinerator is located in excess of 300 feet from any pre-existing occupied building located off site as required by Rule 62-296.401(7)(j), Florida Administrative Code. The closest residences, that of Mr. Gerrits' father and his tenant, are approximately 1,500 feet away. Petitioners' Challenge For the most part, Petitioners reside northeast, east, or southeast of the incinerator. One Petitioner resides approximately three-tenths of a mile southeast of the incinerator; others reside at greater distances, up to approximately a mile and one-half away from the incinerator. Each of the Petitioners who testified have resided in this area for many years, pre-dating the operation of the incinerator. The Petitioners who testified were credible and well- intentioned. Each of these Petitioners maintained daily logs covering several months when the incinerator was authorized to operate. Some kept logs for several months, while others kept logs for several days. They noted their observations and perceptions in the logs. Admittedly, Petitioners are not experts in the detection of odors or noise levels. Nevertheless, they recorded their own experiences as to what they saw, heard, and/or smelled, believing that the odors and noise came from the incinerator. Some recorded that they smelled the strong odor of smoke, an "acrid smell," a "pungent smell," for example; "it makes your eyes burn and throat burn" said another during the hearing. One witness described the experience as being a prisoner in his house. Another does not go outside when the smell is bad. Generally, the level of odor varied with the weather conditions, i.e., a stronger odor was noticed on foggy and wet days or nights and when the wind blows from the west, which Petitioners contend is the prevailing wind. Some witnesses only smelled the odor during the night and not during the day, and not all of the time. Some complained about the odor and noise, or one and not the other. Some believed the noise coming from the incinerator was a major problem. At least two witnesses who live approximately three-tenths of a mile and 3,500 feet, respectively, from the incinerator site, described the noise as being like a jet airplane. One witness shuts her windows to keep out the noise. (SMG also operates a "wood chipper" or "composter" on site which is loud. Mr. Gerrits stated that he did not think the sound was the same as made by the incinerator fan. He also stated that "[i]t doesn't exceed the noise decibels. It doesn't exceed background noise levels at [their] property line.") Petitioners documented their concerns which are described, in part, above, and also documented their complaints to the Department and local government. It appears that each of the logs prepared by the Petitioners (who kept logs) were given to Petitioner Martha Futscher, who summarized and compiled a hand-written master list of the complaints. Then, Mr. Harvey inputted this data on the master list (spread sheet) of complaints, which appears as Petitioners' Exhibit F1. The master list contains recorded observations from May 2002 through January 2003. The master list contains a representation of when the incinerator started and stopped for various days and when it was operational or not, and this information was derived, according to Mr. Harvey, from the logs maintained by SMG. The master list also provides tons per hour of waste burned on particular days, the observer's initials, and the approximate distance each observer lived from the incinerator, and the comments, with time of observation or perception noted. There are discrepancies between the master list and the actual logs maintained by SMG as to when the incinerator was operational. There also appears to be several differences in observations between the Petitioners' master list and other evidence which indicates when Mr. Soich inspected the incinerator and determined that the incinerator was operating satisfactorily. Compare Petitioners' Exhibit 2 with Petitioners' Exhibit F1. For example, the master list records an observation from May 30, 2002, when the incinerator was operating, when there was noise and smoke noted at 8:00 a.m., and flames at the incinerator and odor at 5:30 p.m. Conversely, Mr. Soich was on-site on May 30, 2002, and observed the scheduled VE test. No problems were noted with the operation on this date by Mr. Soich. Mr. Soich also noted that "wood waste was properly dry and free of debris." The VE test on May 30, 2002, was performed from 10:29 a.m. to 11:59 a.m. and showed compliance with opacity limits. The master list indicates that black smoke was observed (no time given) on May 7, 2002, when the incinerator was operational, yet Mr. Soich inspected the incinerator on that day and there is a notation in the record that the incinerator was operating between 0-5 percent visible emissions. (Mr. Soich opined that it should be very rare to smell objectionable odors if the visible emissions run at a 5 percent level.) For October 15, 2002, there is a notation in the master list that a Petitioner commented that the incinerator was running during the day ("AM/PM Running") and that there was a strong smell at approximately 7:05 p.m. A strong smell at the person's house was also noted at approximately 9:30 p.m. on that day. However, Mr. Soich performed an annual inspection of the incinerator on October 15, 2002, and there is a notation on the master list, Petitioners' Exhibit 2, that the incinerator was not operating due to recent rain. As one Petitioner testified, her point was that the inspectors are not there when she hears the noise, sees smoke, and smells the odor. Mr. Soich confirmed that he does not inspect the facility in the evening. Petitioners also provided, as evidence in support of their position, six videotapes of the incinerator for September 19, October 3, October 23, November 25 (2 tapes), 2002, and January 10, 2003. (Mr. Harvey took the videotapes from the same location, across the street and west of the incinerator.) Each tape, except for September 19, 2002, showed smoke emanating from the operational incinerator. On September 19, 2002, the incinerator was not running according to the SMG log. There was a malfunction which was reported to the Department. The SMG log indicates that the pit was cleaned out, site cleared and rows moved. There is also a notation in the SMG log for this date that there was a power failure/malfunction at the incinerator at 9:00 a.m., and that the power was out. According to Mr. Gerrits, the malfunction caused smoke. (One Petitioner observed smoke from ashes on September 19, 2002.) While the Petitioners proved that there was smoke emanating from the operation of the incinerator on the days which were videotaped, with the exception of September 19, 2002, this did not necessarily prove that the emissions exceeded the requirements of the Department rules or that there was an objectionable odor emanating therefrom. Mr. Stoich observed the videotapes played during the hearing. In particular, with respect to the January 10, 2003, videotape, Petitioners' Exhibit 12, Mr. Stoich stated that a level of opacity cannot be determined from photographs and videotapes. He also noted that there was "a lot of white smoke," an atypical situation according to him, emanating from the incinerator and that he, as a compliance inspector, would have investigated further and performed an inspection, including a VE test, to determine if there was a violation, had he seen this smoke. However, he stated that without actually seeing the operation, he could not determine whether a violation had occurred. There was persuasive evidence that compliance with the opacity limits of a permit can only be determined through VE tests conducted using the Department-approved EPA Method 9. The VE test takes into account wind, the angle of the plume, the position of the sun, and other factors, and must use appropriate averaging to ensure that the test is valid. A smoke plume can look quite dense at the wrong angle or if the light is reflecting off the plume in a certain way, when in fact it is in compliance with Department rules. The VE tests for the incinerator have, with one exception, see Finding of Fact 24, demonstrated compliance with the opacity limits in the construction permit. As noted herein, upon receipt of notice that one VE test failed, SMG implemented corrective actions, and two VE tests conducted after the time showed the incinerator was operating in compliance with the opacity limits of the permit. See Findings of Fact 27 and 29. The Department relies on its compliance inspectors, such as Mr. Soich, to make a determination of whether an air emission source is causing an objectionable odor. There does not appear to be an approved Department method for measuring odors from incinerators. (Mr. Nelson stated that odors are difficult to test and that "odor is done collecting samples." No samples were taken or analyzed.) On the other hand, Mr. Soich testified that, based on his years of experience, he has developed certain methods for determining whether a facility is emitting an objectionable odor under the rules. If he receives an odor complaint, which he has in this case, he goes to the site and checks the prevailing winds. He also travels around the facility to determine the source of the odor. An odor can be deemed objectionable if it is very strong and overpowering, such that he cannot stay on- site and breathe in the odors. An odor can also be deemed objectionable if, after being on-site for some extended period of time, he begins to develop symptoms such as runny eyes, a scratchy throat, or a headache as a result of the smell. Finally, he may bring along another Department employee to determine whether the other individual finds the odor objectionable. Enforcement actions can be taken if objectionable odors are detected. Mr. Soich testified that he has inspected the incinerator at least nine times in the past year and never detected an objectionable odor. On some of the visits, the incinerator was not operational. On rebuttal, several residents of the area testified that they had not experienced objectionable odors from the incinerator. David Stevens, the Chief of the DeRosa County Fire Department, testified that an open land-clearing burn emits black smoke, more so than he observed from the incinerator. This fire department only had to respond to false alarms at the incinerator. Mr. Stevens personally inspected the operation of the incinerator and thought it was a very safe operation. Randy Morgan, a wildlife firefighter and certified burner with the Division of Forestry with over 16 years of experience in fire control, testified that approximately 50,000 acres of the state land burns occurred in Citrus County last year. These land burns can be a significant source of smoke and odor. In addition, approximately 50 open burn authorizations are issued each day. He also testified that controlled burns of approximately 15 fires of approximately 50 to 2,000 acres a day occurred in 2002 in proximity of the SMG incinerator which is a source of smoke and odor. The state also conducts open burns of some kind approximately ten months out of the year. Other witnesses testified that, given the rural nature of the community, open burning of trash, wood, and leaves occurs on a regular basis. Ultimate Findings of Fact Credible evidence established that SMG meets or exceeds the requirements in the construction permit to reduce smoke, dust, and odor, and these requirements are carried over to the operating permit. Credible evidence established that SMG employs the same, if not better, practices and permit conditions to control smoke, dust, and odor as other air curtain incinerators in the state. Credible evidence established that the SMG incinerator is operated in accordance with its construction permit. Credible evidence established that the SMG incinerator can be expected to be operated in accordance with its operating permit. Credible evidence established that the SMG incinerator is operated in accordance with Department rules. In light of the foregoing, SMG has demonstrated reasonable assurance that its air curtain incinerator has been operated in compliance with the construction permit and that the incinerator can continue to be operated in accordance with the conditions of the operating permit.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Environmental Protection enter a final order granting SMG's application and issuing Permit No. 0170360-002-AO, as amended, and subject to all conditions, including but not limited to the Specific Conditions set forth in the Department's Notice of Intent to Issue, for the operation of an air curtain incinerator in Citrus County, Florida. It is further recommended that Petitioners' challenge to the amendment to the operating permit be dismissed. See Preliminary Statement. DONE AND ENTERED this 21st day of April, 2003, in Tallahassee, Leon County, Florida.5 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 21st day of April, 2003.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: At all times pertinent to this proceeding, the Department was the state agency responsible for receiving applications for, and issuance of, permits for the construction of air curtain incinerators in the State of Florida. Respondent Daughtrey, the applicant for a permit for the construction of an air curtain incinerator, is a corporation authorized to do business in the State of Florida and is located at 6816 Southwest County Road (C.R.) 769, Arcadia, DeSoto County, Florida. The property upon which the proposed air curtain incinerator would be placed is located approximately two miles north of the intersection of C.R. 761 and C.R. 769, southwest of Arcadia, DeSoto County, Florida and is owned by Harry and Hilda Johnson. On January 24, 1994, Daughtrey submitted a permit application to the Department's Southwest District Office for a permit to construct an air curtain incinerator (incinerator) in DeSoto County, Florida. On February 22, 1994, August 9, 1994, and September 8, 1994, the Department requested additional information from Daughtrey concerning the application. On July 13, 1994, August 16, 1994, and September 30, 1994, Daughtrey furnished the Department the requested information. The application was considered complete on September 30, 1994. On November 2, 1994, after Daughtrey had complied with the several requests for additional information, the Department issued an Intent To Issue Permit No. AC14-244330 to Daughtrey for the construction of an incinerator in DeSoto County, Florida. On November 18, 1994, Petitioners filed a Petition For Formal Administrative Hearing with the Department challenging the Department's Intent To Issue Permit No. AC14-244330 to Daughtrey for the construction of an incinerator in DeSoto County, Florida. On July 6, 1995, the Department issued an amended Intent To Issue Permit No. AC14-244330 to Daughtrey for the construction of an incinerator in DeSoto County, Florida. The amendment was necessary to change the name of the manufacturer of the incinerator. The proposed permit would authorize the construction of an incinerator with a clay strata burning pit having dimensions 10 feet wide x 11 feet deep x 35 feet long. The dimensions of the clay strata burning pit are in accordance with Rule 62-296.401(6)(d), Florida Administrative Code. Emissions from the incinerator are controlled by a curtain of forced air at a very high static pressure over and around the burning pit. The permit application proposed the use of an air curtain blower along with a manifold to provide forced air to the burning pit. The combustion temperature range for the burning pit ranges from approximately 2,000 to 2,800 degrees Fahrenheit. As requested by Daughtrey, the proposed permit would allow a maximum charging rate of 4.5 tons per hour on a daily average which, based on the proposed 8 hours of operation per day, would equal a burning rate of 36 tons per day and would not exceed the tons per day burning rate authorized under Rule 62- 296.401(6)(i), Florida Administrative Code. As requested by Daughtrey, the proposed permit limits the hours of operation to 1,088 hours per year. The proposed permit, in accordance with Rule 62-296.401(6)(e), Florida Administrative Code, would allow the burning of only wood products consisting of trees, logs, large brush, stumps relatively free of soil, unbagged leaves and yard trash, tree surgeon debris, and clean dry lumber such as pallets. Daughtrey proposes the burning of only wood products as set out in the above-referenced rule and proposed permit. The proposed permit, in accordance with Rule 62-296.401(6)(f), Florida Administrative Code, expressly prohibits the incineration of materials such as sawdust, paper, trash, tires, garbage, plastics, liquid wastes, chemically treated or painted wood, and other similar materials. Daughtrey does not propose the burning of any of the materials set out in the above-referenced rule or the proposed permit. The proposed permit allows the use of virgin oil, natural gas or liquefied petroleum gas to start the fire as provided for in Rule 62- 296.401(6)(g), Florida Administrative Code. Daughtrey proposes the use of diesel fuel (considered by the Department to be a virgin oil) to start the fire. The proposed permit allows visible emissions during start-up periods (not to exceed the first thirty minutes of operation) of an opacity up to 35 percent averaged over a six minute period as provided for in Rule 62- 296.401(6)(b), Florida Administrative Code. The proposed incinerator is designed to meet the requirements of the above-referenced rule and Daughtrey proposes to meet the emission requirements of the above-referenced rule during start-up periods. The proposed permit limits visible emissions outside of start-up periods to no more that five percent opacity, with visible emissions of up to 20 percent opacity allowed up to three minutes in any one hour as provided for in Rule 62-296.401(6)(a), Florida Administrative Code. The proposed incinerator is designed to meet the requirements of the above-referenced rule and Daughtrey proposes to meet the visible emissions requirements outside of start-up periods as provided in the above-referenced rule. The proposed permit prohibits starting the incinerator before sunr ise and requires that all charging of the incinerator be completely stopped before sunset as required by Rule 62-296-401(6)(h), Florida Administrative Code. Since Daughtrey proposes an eight-hour day operation, Daughtery proposes charging the incinerator after sunrise and to completely stop charging the incinerator before sunset. The proposed permit limits the height of the ash in burning pit to one-third of the depth of the pit or to a point where the ash begins to impede combustion, whichever occurs first as provided in Rule 62-296.401(6)(m), Florida Administrative Code. Daughtrey proposes to remove the ash when it reaches one- third the height of the burning pit or when it reaches a point where the ash begins to impede combustion in accordance with the above-referenced rule. Furthermore, Daughtrey proposes, in accordance with Rule 62-296.401(6)(l), Florida Administrative Code, not to allow the material loaded into the incinerator to protrude above the air curtain. The proposed permit requires the maintenance of a operating log which must contain the following information: total charges total materials charged (tons) daily operating hours (start and stop times) a calendar year cumulative total for hours of operation (recorded on monthly basis) daily average hourly charging rate type of maintenance performed comments and operator's signature The daily operating log shall be maintained at the facility for at least two years and must be available for inspection by the Department at all times. Daughtrey proposes maintaining an operating log in accordance with the above- referenced rule and proposed permit. The proposed permit requires that all reasonable precautions be undertaken to prevent and control the generation of unconfined emissions of particulate matter in accordance with Rule 62-296.310(3), Florida Administrative Code. These precautions include requirements that: (a) ash must be wetted with water prior to removal; (b) a front-end loader must be utilized to remove ash from the bottom of the pit; and (c) water be applied as necessary to the plant grounds. Daughtrey proposes to take all reasonable precautions to prevent and control the generation of unconfined emissions of particulate matter as set out above. To ensure that the visible emission limitations are not exceeded and objectionable odors not generated, the proposed permit requires that the incinerator's fan shall continue to operate after the last charge of the day until all combustion (presence of any flame or smoke) has ceased. Daughtrey proposes to continue the operation of the incinerator's fan in accordance with the above-referenced rule and proposed permit. The proposed permit, in accordance with Rules 62-297.340(1)(a) and 62- 297.570(2), Florida Administrative Code, requires that the incinerator shall be tested for visible emissions within 30 days after the date the incinerator is placed into operation and that the test report shall be submitted within 45 days of testing to the Department's Southwest District Office in conjunction with an operating permit application. The proposed permit requires that the testing of visible emissions must be conducted within 90-100 percent of the maximum allowable charging rate of 4.5 tons/hour and such testing of emissions must be accomplished when the incinerator is charged with a mixture of materials as listed in Specific Condition 8 of the proposed permit. The proposed permit provides that the visible emission test report shall include the charging rate, a description of the materials burned, starter fuel used and a copy of the daily operating log for the test day. The application included an emission factor of 13 pounds per ton for uncontrolled emissions of particulate matter for a total of 58.5 pounds per hour of particulate matter per hour using the permitted charging rate of 4.5 tons per hour and 2 pounds per ton for controlled emissions of particulate matter for a total of 9.0 pounds per hour of particulate matter using the permitted charging rate of 4.5 tons per hour. The Department estimated the emissions at approximately 9 pounds per hour of particulate matter. The estimated emissions of 9.0 pounds per hour of particulate comes within the emissions limits set forth in Rule 62-296.310(1)(b), Florida Administrative Code. The incinerator is located in excess of 300 feet from any preexisting occupied building located off site as required by Rule 62-296.401(6)(j), Florida Administrative Code. The incinerator will not have a control gate or check-in station but, in accordance with Rule 62-296.401(6)(k), Florida Administrative Code, will not be operated within 1000 feet of any active portion of a landfill. The proposed permit provides that, in accordance with Rule 62- 296.401(1)(b), Florida Administrative Code, no objectionable odor will be allowed. Daughtrey's proposed operation of the incinerator is designed to prevent objectionable odors. Upon being removed from the burning pit, the ash generated by the project will be placed in a holding area close to the burning pit, covered with soil. Subsequently, the ash and soil will be mixed and spread over the Johnsons' property. There is no well on the property. Water to be used in the operation (wetting ashes and fire prevention) will be supplied using a 3,000 gallon water tank furnished by Daughtrey. Daughtrey has furnished a Fire Prevention Plan. There was no evidence to show that the project would result in any type of water pollution. The permit application included the manufacturer's plans and specifications for the manifold and burner fan. The permit application included design drawings and specifications for the burning pit as prepared by the Daughtrey's registered professional engineer. There is sufficient evidence to show that Daughtrey has provided the Department with reasonable assurance that the proposed project will comply with the appropriate provisions of Chapters 62-4 and 62-200 through 62-297, Florida Administrative Code.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Environmental Protection enter a final order granting Daughtrey's application and issue Permit No. AC14-244330, subject to all conditions, including but not limited to the specific conditions, set forth in the Intent To Issue, for the construction of an air curtain incinerator to be located approximately two miles north of the intersection of C.R. 761 and C.R. 769, southwest of Arcadia, DeSoto County, Florida RECOMMENDED this day 29th of December, 1995, at 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 29th day of December, 1995. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 94-6934 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 Department and Petitioners in this case. Proposed Findings of Fact of Petitioners Sue Ann Eagleton's and Susie Hayden. Proposed findings of fact 1, 2, 6, 10, 28-32, 34-37, and 42-48 are neither relevant nor material to this proceeding. Proposed findings of fact 3-5, 7-9, 11-18, 49 and 50 are not supported by evidence in the record. Proposed findings of fact 19-27 are adopted in substance as modified in Finding of Fact 14, otherwise these proposed findings are not supported by evidence in the record. Proposed findings of fact 33 and 38-41 are adopted in substance as modified in Findings of Fact 8, and 31, respectively. Proposed Findings of Fact of Petitioners DeSoto Citizens Against Pollution, Inc., Barbara Buck, Alan Behrens, John Marin and Pat Marin. Proposed findings of fact 1, is adopted in substance as modified in Finding of Fact 31. Proposed findings of fact 2-4, 8-10, 12-13, 15-20 and 22-28 are neither relevant nor material to this proceeding. Proposed findings of fact 5-7, and 11 are not supported by evidence in the record and additionally, are neither relevant nor material to this proceeding. Proposed findings of fact 14 and 21 are not supported by evidence in the record. Proposed Findings of Fact of Respondent Department. 1. Proposed findings of fact 1 through 35 are adopted in substance as modified in Findings of Fact 1 through 37 of the Recommended Order. Respondent Daughtrey elected not to file any Proposed Findings of Fact. COPIES FURNISHED: Virginia B. Wetherell, Secretary Department of Environmental Protection Douglas Building 3900 Commonwealth Blvd. Tallahassee, Florida 32399-3000 Kenneth Plante, Esquire Department of Environmental Protection Douglas Building 3900 Commonwealth Blvd. Tallahassee, Florida 32399-3000 W. Douglas Beason, Esquire Department of Environmental Protection 3900 Commonwealth Blvd. Sarasota, Florida 32399-3000 Diane Daughtrey Qualified Representative c/o Dwight Daughtrey Construction, Inc. 6816 SW C.R. 769 Arcadia, Florida 33821 William Mulloy, Esquire 7025 Manasota Key Road Englewood, Florida 34223 Alan Behrens Qualified Representative 4070 Armadillo Trail Arcadia, Florida 33821
The Issue Sloan Construction Company, Inc. (Sloan) has applied to the Department of Environmental Regulation (DER) for a permit to relocate its drum mix asphalt plant, a source of air emissions, from its current site in Flagler County to Brevard County. The issue in this proceeding is whether that permit should be granted. More specifically, it must be determined whether the proposed activity will meet applicable statutory and regulatory standards. An ancillary issue regarding Respondent, Sloan's entitlement to attorneys fees and costs pursuant to Section 120.57(1)(b)5., F.S. is addressed in a separate order entered this same date.
Findings Of Fact Sloan Construction Company, Inc., (Sloan) is a highway contractor doing business in the southeastern United States. It operates asphalt plants in South Carolina and in Florida; in addition to the portable plant at issue here, its Florida plants, permitted by the Department of Environmental Regulation (DER) are in Jacksonville, St. Augustine, and Orlando. On December 9, 1991, Sloan applied to DER to relocate its portable asphalt plant from Flagler County to Brevard County. The company has a contract with the Florida Department of Transportation for work on I-95 and on A-1-A in Brevard County and needs the plant for that work. This same plant was initially permitted by DER's southwest district office on November 9, 1989 for operation in Highlands County. Pursuant to subsequent permits the plant moved to Lake County in 1990, and to Flagler County in 1991. Each time it was moved, the relevant DER district office reviewed the air pollution impact before granting the permit. The permit will expire in November 1994. A consent order was entered in December 1990 between Sloan and DER regarding violations in May and June 1990. The violations described in the consent order were that visible emissions exceeded 20% opacity, and the metal tanks serving as the scrubber final settling basin were low on water with large amounts of particle flotation. The company paid a fine of $7,750 and made the DER-required changes in its maintenance and operation. The company monitors its own system and makes necessary repairs and improvements when problems are anticipated. When the scrubbers fail to operate properly, they are shut down and fixed. The scrubbers do not involve water discharge as they are a closed circuit system. This permit application is not requesting approval to discharge into the waters of the state. For this permit DER requires annual stack testing to determine whether the plant is meeting air emission limitations for particulates (.04 grains per dry standard cubic foot) and opacity (20%). Sloan retains an engineering consultant, Bottorf and Associates, to conduct those tests. The last stack test, May 1991, indicates that the emissions meet the standards. It is anticipated that this same plant will perform just as well in Brevard County. However, a proposed condition of the new permit is that another stack test be performed within 20 days of commencement of operation, in order to assure that equipment is functioning properly after the move. A condition of the existing permit is that unconfined emissions of particulate matter from vehicular movement, loading, construction or demolition be controlled by paving of traffic areas and the sprinkling of stockpiles with water. Sulphur dioxide is considered to be the pollutant of greatest concern in a facility such as this. Sulphur dioxide is generated from the burning of fuel containing sulphur. The applicant has agreed to reduce sulphur content of its fuel from 1.8% to .5%, and to reduce its sulphur dioxide emission limit from 96 tons per year to 26 tons per year. No DER rule requires air pollution source modelling for an asphalt plant or other minor source (defined as less than 100 tons per year of a single pollutant emission). However, because of the proximity of the proposed facility to the existing Orlando Utilities Commission (OUC) power plant, and public concern about sulphur dioxide emissions in the area, DER air permitting engineer, John Turner, ran SCREEN models to predict the combination of emissions from this proposed facility and other sources in the area. The total projected sulphur dioxide ambient air level from the SCREEN models run by John Turner for the Sloan facility at 26 tons per year included four other local sources, and included a more specific model for the nearby OUC plant, which model considered additional sources. John Turner's modelling yielded 241.63 micrograms/ cubic meter on a 24 hour basis. The ambient air quality standard is 260. John Turner's modelling yielded a conservative estimate, that is, it most likely over-predicted sulphur dioxide levels. The model assumed no reduction in sulphur dioxide from aggregate in asphalt plant dryers; tests actually reflect a 70-89% reduction, and the U.S. Environmental Protection Agency (EPA) assumes a 50% reduction when no tests are available. The model assumed all sources would be operating 24 hours a day, when they actually operate for a more limited period. Moreover, the model assumed all sources would be operating at the same time at their maximum permitted rates. Turner's assumptions also assumed worst case meteorological conditions, such as wind inversions, that would combine plumes from two sources in opposite directions. In the OUC model used by Turner a worst case sulphur dioxide background of 44 was assumed when the normal background level would be much lower. "Downwash" is the effect of wind hitting a large, generally flat, structure or impediment, rising to go over the top and then dropping---an effect which would cause a pollution plume to drop to the earth more quickly. The County's expert conceded that John Turner's modelling was conducted properly, but criticized the model for failing to consider downwash. John Turner and his supervisor, Allen Zahm, did consider downwash but they suggest that it would lower, not raise, the ambient air level, as downwash tends to retain the concentration closer to the stack. The County's expert stated that he did not know that downwash would actually occur on the site. As provided in the permit conditions, the applicant intends to use "on specification" used oil for fuel. "On-specification" used oil must meet standards not to exceed certain allowable levels for arsenic, cadmium, chromium and other substances. There is no allowable level of PCB; that is, the standard level is zero. The sulphur and heavy metal content of the fuel is monitored through certificates of quality required by DER. Sloan has complied with the permit requirements as to its fuel quality. The proposed site for the facility is in Delespine, north of Cocoa in Brevard County, near Highway U.S. 1 and near the Indian River Lagoon. The plant will be approximately 700 meters southwest of an existing mid-sized power plant, OUC, and approximately a mile northwest of a Florida Power and Light Company power plant. Adjacent to the site is a large residential community, Port St. John, with approximately 18,000 residents. The community has expanded rapidly as a result of the availability of affordable housing, and it includes a mix of elderly citizens and young families with children. The residents are genuinely and sincerely concerned for their health and safety and the character of their neighborhoods. They provided anecdotal testimony of increased respiratory problems and negative environmental impacts which they attribute to the power plants and other industrial uses in the area. They are concerned about increased traffic and problems of evacuation in the event of an emergency. They are worried that the traffic and emissions from the proposed facility will cause special problems for students at the nearby elementary schools. As real and sincere as those concerns are, they do not overcome the substantial evidence presented by the applicant that the proposed permit meets the specific requirements of the responsible state agency. The citizens' concerns are classic land use issues, which through zoning and land use regulation, are the jurisdiction of their local governments.
Recommendation Based on the foregoing, it is hereby, recommended that the Department grant Sloan's application to amend its operating permit for its asphalt plant (Permit No. 167794) with the change in permit conditions as noticed by the Department (Sloan Ex. #27), and with the condition, as stipulated, that the stack for air emissions from the facility will be 42.5 feet in height above ground level. RECOMMENDED this 22nd day of June, 1992, in Tallahassee, Leon County, Florida. MARY CLARK 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 22nd day of June, 1992. COPIES FURNISHED: Petitioners #92-1801 Thomas Lanham Asst. County Attorney Brevard County Attorney's Office Building C, Suite 346 2725 St. Johns Street Melbourne, FL 32940 #92-1802 Joseph & Katherine Tidwell 4000 Delespine Road Cocoa, FL 32927 #92-1803 Carol L. Harris 6040 Gilson Avenue Cocoa, FL 32927 #92-1804 Harry S. Rice 931 Galleon Street Cocoa, FL 32927 #92-1805 Joseph F. DeBarry 950 Galleon Street Cocoa, FL 32927 #92-1806, 92-1807, 92-1813 (Counsel for Port St. John Homeowners Assn., Jessie Fleming, & Don L. Williams) F. Michael Driscoll, Esquire 1530 S. Federal Highway Rockledge, FL 32955 #92-1808 Bea Polk 101 River Park Blvd. Titusville, FL 32780 #92-1809 Russell Harris 6040 Gilson Avenue Cocoa, FL 32927 #92-1811 Opal Hall 7655 South U.S. 1 - Lot 17 Titusville, FL 32780 #92-1812 John Ferguson 7020 Song Drive Cocoa, FL 32927 #92-1814 First Baptist Church of Port St. John Joseph E. Tidwell 4000 Delespine Road Cocoa, FL 32927 #92-1815 David & Rhonda Tidwell 4530 Robert Street Cocoa, FL 32927 #92-1816 Felicia Cardone, et al. 7230 N. U.S. Hwy. 1, #106 Cocoa, FL 32927 #92-2471 James M. Shellenberger, et al. Sunrise Village Condominium 7040 N. U.S. Hwy. 1, Unit #101 Cocoa, FL 32927 Respondents (for Sloan Construction Company, Inc.) F. Alan Cummings, Esquire Michael Riley, Esquire P.O. Box 589 Tallahassee, FL 32302 (for DER) Douglas H. MacLaughlin, Esquire DER-Twin Towers Office Building 2600 Blair Stone Road Tallahassee, FL 32399-2400 Carol Browner, Secretary DER-Twin Towers Office Building 2600 Blair Stone Road Tallahassee, FL 32399-2400 Daniel H. Thompson, General Counsel DER-Twin Towers Office Building 2600 Blair Stone Road Tallahassee, FL 32399-2400
The Issue The issue is whether Petitioner is entitled to reimbursement of its attorneys' fees and costs under section 120.595(3), Florida Statutes, from its successful prosecution of a rule challenge in DOAH Case No. 12-1944RX.
Findings Of Fact In DOAH Case No. 12-1944RX, Petitioner challenged Florida Administrative Code Rules 69O-170.017 and 69O-170.0155 and incorporated forms OIR-B1-1699 (Form 1699) and OIR-B1-1655 (Form 1655). These rules generally relate to fixtures and construction techniques that mitigate wind loss and earn homeowners a discount on the wind portion of their homeowners' insurance premium. The most important of these rules, Form 1699 consists of two matrices: one matrix provides discounts for mitigative fixtures and construction techniques applied to existing residential construction (i.e., predating the 2001 Florida Building Code), and the other matrix provides discounts for mitigative fixtures and construction techniques applied to new residential construction (i.e., subject to the 2001 Florida Building Code or any of its successors). The Final Order invalidates the matrix applicable to existing residential construction, but not the matrix applicable to new residential construction. The Final Order concludes that the omission from Form 1699 of discounts for increased wind resistivity for doors modifies and contravenes the law implemented and is arbitrary. The Final Order finds other omissions from Form 1699--i.e., discounts for increased wind resistivities for windows and increased impact resistivities for doors--but these findings served the purpose of partly justifying the invalidation of the entire form for the omission of a single set of discounts substantially affecting Petitioner--i.e., the discounts for increased wind resistivities for doors. (Findings as to the interdependency of all of the discounts provided the remaining justification for invalidating the entire form for the omission of a single set of discounts.) Form 1655 advises homeowners of the availability of discounts applicable to the wind portion of their homeowners' insurance premiums for various mitigative fixtures and construction techniques. The Final Order invalidates Form 1655 in its entirety. The main reason is that Form 1655 fails to notify homeowners about the availability of discounts for fixtures and construction techniques that increase the wind resistivity of windows and doors. An additional reason is that Form 1655 mentions shutters as the sole fixture to increase the impact resistivity of windows and doors, misleadingly implying that shutters are the sole fixture or construction technique for increasing the impact resistivity of windows and doors. Rule 69O-170.017 incorporates by reference Form 1699. The Final Order denied Petitioner's request to invalidate rule 69O-170.017 because the rule incorporates the still-valid, existing-construction matrix in Form 1699. Rule 69O-170.0155 incorporates by reference several forms. The Final Order invalidates only rule 69O-170.0155(k), which is the subsection that incorporates Form 1655. Petitioner commenced its rule challenge to obtain a wind-premium discount for homeowners who purchased and installed its bracing system on their existing, nonglazed garage doors in order to increase their wind resistivity. The thrust of Petitioner's challenge was thus to the omission from Form 1699 of any discounts for fixtures and construction techniques that increase the wind resistivity of doors. Obviously, the shortcomings of Form 1655--and its adopting rule, rule 69O-170.0155(k)--were almost entirely derived from this omission from Form 1699. Respondents' liability for attorneys' fees and costs thus requires consideration only of its adoption of Form 1699 without any discounts for fixtures and construction techniques that increase the wind resistivity of doors. As noted in the Final Order, the establishment of discounts for all mitigative fixtures and construction techniques is a complicated process. The actuarial expertise necessary to complete this task resides in Respondent Office of Insurance Regulation (OIR), but is itself dependent on engineering expertise that is not found within either respondent, or at least was not in 2006 when Form 1699 was adopted. The engineering work underlying Form 1699 featured computer modeling, among other things, to project the salient features of storms that may be expected to strike various parts of Florida over thousands of years; as for impact resistivity, to project the trajectories and momentum of missiles that will be launched by these storms; to place in the path of these storms and missiles various forms of residential construction with relevant combinations of mitigative fixtures and construction techniques covering several factors, including the protection of windows and doors from impacts and the protection of windows and doors from wind (without regard to impacts); to project the damage states that will result from these modeled storms upon individual hypothesized residential buildings; and to project the economic losses--with particular emphasis on insured losses--that will result from these damages. The relevant timeframe for this case begins with Hurricane Andrew in 1992. As the Final Order describes, the Florida legislature and other federal and state agencies and organizations reacted swiftly and comprehensively to this storm and the catastrophic damage and loss that it caused. FEMA quickly published its analysis of, among other things, the relationship between construction and storm damage. In 2001, the legislature adopted the Florida Building Code (FBC), which required, among other things, new construction to meet wind loads specified in the code, based on projected wind speeds in different regions of Florida. Almost at the same time that the 2001 FBC went into effect, in March 2002, Applied Research Associates, Inc., published the Development of Loss Relativities for Wind Resistive Features of Residential Structures (2002 ARA Report). Procured by the Florida Department of Community Affairs, which, at the time, had considerable responsibilities in the adoption of the 2001 FBC, the 2002 ARA Report was a groundbreaking achievement in modeling the effects, in terms of reduced damage and loss, from various forms of mitigative fixtures and construction techniques, alone and in almost countless combinations. For present purposes, the focal point of the 2002 ARA Report were tables of loss relativities, which provided factors by which to calculate how different combinations of mitigative fixtures and construction techniques reduced wind losses. Taking these data, OIR's actuaries issued in January 2003 an informational memorandum and a precursor to Form 1699, which suggested premium discounts to be used by homeowners' insurers when filing insurance rates. (Then and now, insurers are permitted to use other data sources in setting their rates, but all but two of them use the suggested discounts in Form 1699.) In August 2004, Hurricane Charley struck Florida. A design wind event, like Hurricane Andrew, the timing of Charley, after the adoption of the 2001 FBC, proved the effectiveness of the 2001 FBC in requiring fixtures and construction techniques that demonstrably mitigated wind damage and loss. In 2006, respondents issued Form 1699 in its present form, eliminating a dampening factor that they had included in the precursor form three years earlier. (To allow insurers to adapt to the new rate-setting environment, respondents had halved the discounts in the precursor form.) The 2002 ARA Report claims to adhere to the statutory mandate contained in section 627.0629(1), to determine discounts for fixtures or construction techniques that "enhance roof strength, roof covering performance, roof-to-wall strength, wall-to-floor-to-foundation strength, opening protection, and window, door, and skylight strength." For reasons explained in the Final Order, "opening protection" is limited to the impact resistivity of windows and doors, and the "strength" of windows and doors (skylights being treated as windows) is limited to their wind resistivity. Unfortunately, the 2002 ARA Report collapsed opening protection and the strength of windows and doors into one category--opening protection--so ARA never developed loss relativities for fixtures and construction techniques that increased the wind resistivities of doors or, for that matter, windows. As noted above, respondents were entirely dependent on the work of ARA due to its specialized knowledge of the FBC and, more generally, its expertise in engineering and computer modeling. ARA, not respondents, possessed this highly specialized knowledge, which was necessary to generate the loss relativities, on which respondents, in turn, could rely to generate the legislatively mandated premium discounts. The omission of loss relativities for the strength of windows and doors--as a standalone category or within the category of opening protection--is not apparent in the richly detailed 2002 ARA Report. The above-described facts--coupled with the time- pressured nature of the task assigned to respondents--provide the reasonable basis in fact for the adoption of the portion of Form 1699 that has been invalidated. The factual justification for the adoption of the portion of Form 1699 that has been invalidated is greater than any legal justification that respondents may claim. The statute truly is a model of clarity--and succinctness. Reduced to its plainest terms, the statute calls for discounts for six categories of mitigative fixtures and construction techniques, and ARA and respondents addressed only five. However, some legal justification exists for the adoption of the portion of Form 1699 that has been invalidated. First, the legal mandate of section 627.0629(1) does not exist in a vacuum; it operates in the complex facts of engineers, computer programmers, and actuaries whose work is necessary to lend meaning to the statutory mandate. To this extent, respondents find some legal justification for the same reason that they find ample factual justification for the adoption of the portion of Form 1699 that has been invalidated. Second, the legislature itself missed a clear, early opportunity to remind respondents of their failure--obvious, perhaps, only in hindsight--to address the omitted sixth factor enumerated in section 627.0629(1). The precursor of Form 1699 likewise omitted discounts for fixtures and construction techniques that increased the wind resistivities of doors and windows. When, in 2006, the legislature mandated the adoption of full discounts, without any dampening, it easily could have forcibly reminded respondents that they--and their contractor-- had missed one of the six statutory discounts. The subtlety of respondents' legal error seems to have eluded the legislature, as well. Third, even in hindsight, the legal underpinning of the invalidation of the existing-construction matrix of Form 1699 is sometimes elusive, given the temptation to join ARA and respondents in analyzing wind resistivities under the factor of opening protection. As disclosed at the hearing, the Administrative Law Judge spent a considerable amount of time, in preparing the Final Order, misanalyzing respondents' treatment of the wind resistivities of doors from the perspective of opening protection. Repeated, close readings of section 627.0629(1), in the context of the complex materials presented in the 2002 ARA Report, eventually revealed the now-clear legal principle that the omitted sixth statutory factor--the strength of windows and doors--applied to wind resistivity (and opening protection was restricted to impact resistivity). And Petitioner itself joined in exactly the same misanalysis, both in its pleading and proof at the hearing in the rule challenge. Seeming to yield once more to this misanalysis, even in the fee hearing, Petitioner cross-examined OIR's lone witness with an emphasis on respondents' flawed decision, as described in the Final Order, to omit a discount for doors under opening protection.
