Cabinet Affairs

1

2 T H E C A B I N E T

3 S T A T E O F F L O R I D A

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Representing:

5

DIVISION OF BOND FINANCE

6 DEPARTMENT OF LAW ENFORCEMENT

DEPARTMENT OF REVENUE

7 STATE BOARD OF EDUCATION

ADMINISTRATION COMMISSION

8 BOARD OF TRUSTEES, INTERNAL IMPROVEMENT TRUST FUND

DEPARTMENT OF ENVIRONMENTAL PROTECTION

9

10 The above agencies came to be heard before

THE FLORIDA CABINET, Honorable Governor Chiles

11 presiding, in the Cabinet Meeting Room, LL-03,

The Capitol, Tallahassee, Florida, on Tuesday,

12 September 9, 1997, commencing at approximately

9:50 a.m.

13

14 VOLUME II

15

16 Reported by:

17 LAURIE L. GILBERT

Registered Professional Reporter

18 Certified Court Reporter

Certified Realtime Reporter

19 Notary Public in and for

the State of Florida at Large

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21

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23 ACCURATE STENOTYPE REPORTERS, INC.

100 SALEM COURT

24 TALLAHASSEE, FLORIDA 32301

850/878-2221

25

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1 APPEARANCES:

2 Representing the Florida Cabinet:

3 LAWTON CHILES

Governor

4

BOB CRAWFORD

5 Commissioner of Agriculture

6 BOB MILLIGAN

Comptroller

7

SANDRA B. MORTHAM

8 Secretary of State

9 BOB BUTTERWORTH

Attorney General

10

BILL NELSON

11 Treasurer

12 FRANK T. BROGAN

Commissioner of Education

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1 I N D E X

2 ITEM ACTION PAGE

3 DEPARTMENT OF ENVIRONMENTAL PROTECTION:

(Presented by Kirby B. Green, III,

4 Deputy Secretary)

5 1 Approved 104

6

CERTIFICATE OF REPORTER 217

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1 P R O C E E D I N G S

2 GOVERNOR CHILES: Good afternoon.

3 We will reconvene our Cabinet meeting,

4 which we recessed this morning.

5 MR. GREEN: Governor --

6 GOVERNOR CHILES: Let me just say at the

7 outset, we do have an awful lot of people, and

8 we wish we could accommodate all of them. We

9 will not be able to seat the people in the

10 aisles, and we really need to keep the aisles

11 open. The Fire Marshal insists on that.

12 I don't know who the Fire --

13 COMMISSIONER BROGAN: You know who he is --

14 GOVERNOR CHILES: I just think for safety

15 purposes, we have to do that.

16 MR. GREEN: Governor, the first item before

17 you is -- are the minutes of the April 23rd,

18 1996, meeting.

19 ATTORNEY GENERAL BUTTERWORTH: Are all the

20 people here for that issue?

21 MR. GREEN: This is the same issue, so

22 yes, sir. This is the first time we've

23 reconvened since the last time.

24 GOVERNOR CHILES: All right, sir.

25 MR. GREEN: So we have the minutes for

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1 approval first.

2 ATTORNEY GENERAL BUTTERWORTH: Motion.

3 COMMISSIONER BROGAN: Second.

4 GOVERNOR CHILES: Moved and seconded.

5 Without objection, the minutes are

6 approved.

7 MR. GREEN: Substitute Item 2 is

8 consideration of a final order granting

9 certification, Florida Power & Light Company for

10 Manatee Orimulsion Conversion Project, subject

11 to Conditions of Certification recommended by

12 the hearing officer.

13 We have -- we have about four staff members

14 who need to make a brief presentation, and then

15 we have about 70 people total, both proponents

16 and opponents of the project, who would like to

17 speak.

18 I would recommend that we limit their

19 testimony to -- to an hour a side.

20 GOVERNOR CHILES: If we have that many

21 people, I think we would try to do that in an

22 hour-and-a-half per side.

23 And we would like to say to everybody, we

24 would like to hear from as many people -- we

25 know a lot of you have come up here. In

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1 consideration of us being able to hear, and more

2 of you being able to speak, if you would limit

3 your remarks, or try not to repeat things that

4 have just been said, it would make it easier for

5 us to be able to hear from more people.

6 Thank you, sir.

7 MR. GREEN: The first presentation will be

8 by Perry Odom, the General Counsel of the

9 Department, to explain how we got back into the

10 position that we are right now.

11 MR. ODOM: Governor Chiles, members of the

12 Cabinet, I just wanted to go over some of the

13 procedural detail as to where we are now, and

14 it's up to y'all where we go from there.

15 As you know, you entered an order in April

16 of 1996 denying certification. That order was

17 appealed by Florida Power & Light. And on

18 appeal, the appellate court found that the order

19 denying certification did not meet with the

20 requirements of the Administrative Procedures

21 Act. The Court vacated the order, and remanded

22 the matter to the Siting Board.

23 As you know, when a court vacates an order,

24 it's the same as saying that order no longer

25 exists. So, in effect, you're back just as you

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1 were in April of 1996, subject to some

2 additional conditions that I'll talk about in

3 just a minute.

4 But that's where you are. It's basically

5 the same posture when it came before you on

6 April 23rd, 1996.

7 You do have several options for your

8 consideration.

9 You may choose to adopt the final order

10 granting certification, as prepared by the

11 Department of Environmental Protection; you may

12 adopt a modified final order granting

13 certification; you may direct your staff to

14 prepare an order denying certification; or if

15 you feel that additional testimony is needed on

16 any of these additional conditions, you may

17 remand the case to the Administrative --

18 Division of Administrative Hearings for further

19 evidence, solely on the issues that you feel

20 need further clarification or elaboration by

21 testimony.

22 The final order that was submitted to you

23 by DEP is identical to the one which we

24 presented to you in April of 1996.

25 It represents our best professional and

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1 technical efforts to minimize the adverse

2 impacts of the proposed project within the

3 confines of the Power plant Siting Act.

4 It approves and adopts the recommended

5 order of the hearing officer, with minor

6 modifications, and recommends that you grant

7 certification, subject to the Conditions of

8 Certification recommended by the

9 hearing officer.

10 I'm sure, as all of you are aware,

11 Florida Power & Light has, subsequent to the

12 remand of the matter to this Cabinet, come

13 forward with additional commitments which it is

14 willing to make if you do grant certification.

15 We did not include those additional

16 commitments in our order because we wanted to

17 present an order to you just as it was when it

18 first came before you.

19 If the Siting Board chooses to grant

20 certification, then it may -- and, in fact, we

21 think should, consider some of those new

22 commitments by Florida Power & Light. And to

23 the extent that you find that they are helpful

24 and go to improve the environment, and further

25 satisfy the requirements of the Power Plant

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1 Siting Act, we feel that you could include those

2 additional conditions in any final order

3 approving certification.

4 So basically, that's the issue that is

5 before y'all today.

6 ATTORNEY GENERAL BUTTERWORTH: May I ask a

7 question, Governor?

8 GOVERNOR CHILES: Yes, sir.

9 ATTORNEY GENERAL BUTTERWORTH: Perry, maybe

10 you can clarify something for me.

11 Are you saying that we're going to be

12 hearing new facts, new evidence here today that

13 the hearing officer has not -- has not heard?

14 MR. ODOM: They're offering new

15 commitments. Whether those constitute evidence,

16 or new conditions, the Power Plant Siting Act in

17 Section 403.5175(4) indicates that the

18 Siting Board can consider additional conditions,

19 and that's what they're presenting to you.

20 If, General, you feel -- or if the Board --

21 the Siting Board, feels that those new

22 conditions need to be elaborated on, or take

23 testimony on, then, as I said, you may choose to

24 remand it to the hearing officer for further

25 evidentiary hearing on those issues that you

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1 want to include, but that you feel you need

2 testimony for.

3 ATTORNEY GENERAL BUTTERWORTH: If we were

4 to -- well, let's say, deny, would FPL be able

5 then just to reapply with all the new facts and

6 everything else?

7 MR. ODOM: I believe so.

8 ATTORNEY GENERAL BUTTERWORTH: Okay.

9 TREASURER NELSON: Governor, may I ask a

10 question?

11 GOVERNOR CHILES: Yes, sir.

12 TREASURER NELSON: This is an unusual

13 procedure whereby an appellate court has vacated

14 it back to the Cabinet.

15 Are we in the legal posture that we should

16 make a decision on the record before us without

17 the inclusion of new evidence?

18 MR. ODOM: Without the inclusion of new

19 evidence, yes, because you are not a

20 fact-finding Board. It was remanded to you for

21 you to enter a new order consistent with the

22 recommended order of the hearing officer, which

23 did not include those new commitments by

24 Florida Power & Light.

25 All I said was, if you feel that some of

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1 those should be included, you can include them

2 as additional conditions for certification as

3 provided by the Power Plant Siting Act.

4 If, however, you feel that you need to take

5 testimony on those, or have an elaboration on

6 those beyond the face of the conditions, it's in

7 that case that you should remand it to the

8 Division of Administrative Hearings.

9 TREASURER NELSON: Well, what I don't

10 understand is, in the consideration of those new

11 conditions, how do we bring that into evidence

12 if we are supposed to make our decision just on

13 the record before us?

14 MR. ODOM: Well, you wouldn't bring it into

15 evidence, you would adopt them as additional

16 conditions as provided by the Power Plant Siting

17 Act.

18 But if you want to take new testimony to

19 elaborate on any of those, or if you feel that

20 they need to be further clarified, then at that

21 point, I think you should remand it, because you

22 cannot -- you're not a fact-finding body, as

23 y'all know.

24 TREASURER NELSON: Well, in the evidence

25 that we're going to hear today from the

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1 testimony, that's going to be new evidence; is

2 it not? That's going to be new testimony.

3 So should we take that under consideration

4 or discard that in our decisions?

5 MR. ODOM: Whichever you choose to do,

6 Commissioner.

7 TREASURER NELSON: Well, what does the law

8 require us to do?

9 MR. ODOM: Well, the law says that you can

10 adopt the order. Let me just -- I've got it

11 right here. It says that: In considering

12 whether an application submitted under this

13 section should be approved in whole, approved

14 with appropriate conditions, or denied,

15 the Board shall consider -- and then it goes

16 through four conditions that's listed.

17 So you are entitled to approve with

18 conditions if you choose to do so. But if you

19 feel that they constitute new evidence, that you

20 need new testimony on them, then at that point,

21 it should be remanded.

22 TREASURER NELSON: Well, those new

23 conditions would be as a result of new

24 testimony; would it not?

25 MR. ODOM: I don't think it's new

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1 testimony. I don't think they're going to offer

2 testimony on it here today. They're going to --

3 they're going to offer the additional conditions

4 that you can accept or reject or remand to a

5 hearing officer.

6 TREASURER NELSON: And the --

7 MR. ODOM: Without --

8 TREASURER NELSON: -- conditions are going

9 to be brought to us in testimony today.

10 MR. ODOM: If you feel that everything that

11 is said here is testimony, yes, sir. But I

12 don't consider it as testimony in the sense of

13 the legally prescribed evidence that would be

14 heard by a fact-finding body.

15 TREASURER NELSON: I see.

16 ATTORNEY GENERAL BUTTERWORTH: If I can

17 just bounce off that, Governor, because I'm

18 getting a little bit confused here.

19 Because if we're finding -- we're listening

20 to these conditions, and if the conditions have

21 changed such that facts found by the

22 Administrative Law Judge are no longer valid,

23 then what is the proper cause of action, to

24 remand it, or just to dismiss it and have them

25 reapply?

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1 MR. ODOM: General, I -- I don't believe

2 they contradict the findings of fact of the

3 hearing officer. I think in some instances,

4 they -- they supplement that, or go beyond

5 that. But I don't think they actually

6 contradict it.

7 But, as I said, if you're not comfortable

8 with the conditions, then you may remand it, if

9 you choose to do so.

10 GOVERNOR CHILES: All right, sir.

11 MR. ODOM: Thank you.

12 TREASURER NELSON: Governor, let me -- let

13 me --

14 GOVERNOR CHILES: Yes, sir.

15 TREASURER NELSON: -- just -- I don't want

16 to belabor this, but I just want to understand

17 the legal posture that we're in.

18 I'm reading from Florida Statutes,

19 403.509(2): The issues that may be raised in

20 any hearing before the Board shall be limited to

21 those matters raised in the certification

22 proceeding before the Administrative Law Judge,

23 or raised in the recommended order, period.

24 Now, tell us what we're supposed to do,

25 given that's what the law says.

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1 MR. ODOM: Mr. Commissioner, if -- I don't

2 know how to say it without saying it -- without

3 confusing you further.

4 If it's new evidence that you're going to

5 consider, you have to remand it to the

6 hearing officer. If they want to supplement the

7 conditions, which is what they're doing, you can

8 adopt the conditions, because the law says you

9 may adopt it -- or you may approve it with

10 additional conditions.

11 COMMISSIONER BROGAN: If I --

12 GOVERNOR CHILES: All right.

13 COMMISSIONER BROGAN: -- Governor --

14 I'm sorry.

15 GOVERNOR CHILES: Well, at some stage, I

16 just want to say, we've got an awful lot of

17 people that we want to hear from. You can -- we

18 can have our discussion maybe before we take any

19 action. I just wonder if we shouldn't --

20 COMMISSIONER BROGAN: Well, the only reason

21 that I want to clarify --

22 GOVERNOR CHILES: Yes, sir.

23 COMMISSIONER BROGAN: -- it is because what

24 we hear over the next 3 hours -- and you're

25 right, we're probably going to do that.

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1 I guess, what you're saying, if I

2 understand you correctly, is I -- I need to

3 weigh anyone's comments who stands at that

4 podium that have not yet been entered as part of

5 the certification process, call it testimony,

6 call it new evidence, call it simply

7 information, or new recommendations.

8 I need to weigh in my mind as a member of

9 the Board anything that -- that was not a part

10 of that certification process as to whether

11 I think it is new evidence, or official

12 testimony, and not just offering new

13 recommendations.

14 And at any time as a member of the Board

15 that I think something has moved beyond

16 certification and into the realm of additional

17 recommendations or testimony, then you're

18 talking about the fact that we're then

19 required -- I would be required to request a

20 remand --

21 MR. ODOM: That's correct.

22 COMMISSIONER BROGAN: -- is that correct?

23 MR. ODOM: Let me let Kirby --

24 MR. GREEN: Try to take a laymen's view, at

25 least as I see it, and as it's been explained to

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1 me.

2 We have been through the certification

3 process. We've -- we have received all the

4 testimony that we can receive as part of the

5 certification process, the technical process of

6 certifying this power plant.

7 Where we are now is -- is we're moving from

8 the technical realm into the public policy

9 portion of this debate.

10 As I understand it, we have received all

11 the testimony that we can receive from the

12 hearing officer in their recommended order on

13 those things that would affect the base

14 certification of the power plant.

15 If you hear things today, or if you've

16 heard things over the past year that you think

17 in the public interest would better that

18 project, you can accept those as public interest

19 add-ons to the certification process without

20 having to take additional testimony.

21 But if you think that we -- we haven't

22 messed -- met the minimum test for

23 certification, and some of these issues go to

24 the base certification, then either you deny for

25 us not having met that test, or you remand but

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1 for additional testimony in front of the

2 hearing officer on those issues so we can bring

3 it back.

4 So the way -- as a layman, I look at it is

5 you've got before you the certification that has

6 been through testimony. It meets the

7 requirement.

8 Anything, again, that you hear today can

9 be -- can be thought of as additional public

10 interest issues that in the public interest

11 debate make it -- make it a better project. But

12 it doesn't go to the base certification of the

13 power plant.

14 COMMISSIONER BROGAN: I just want to make

15 sure that as a member of the Board, I'm not

16 being asked once the jury has gone out to

17 deliberate their final decision after testimony,

18 that while they're out deliberating, suddenly

19 someone is rushing in and saying, I've got new

20 evidence that needs to be considered. That's

21 after the fact.

22 And I just want to make sure that we are

23 procedurally sound in whatever this body ends up

24 doing today, because we're back here a second

25 time, largely, according to the Administrative

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1 Hearing Officer, because we were not

2 procedurally sound when we did this the first

3 time.

4 And I just want to make damn sure that once

5 we vote on this thing one way or the other, up

6 or down, that we are procedurally sound in the

7 action of this Board. That's my greatest

8 concern before we begin to take any testimony on

9 this thing.

10 MR. GREEN: Commissioner, if the base vote

11 is based on additional information that you hear

12 today, or that you've heard -- that you have

13 heard since the hearing officer rendered their

14 recommended final order to that base

15 certification, then the options before you are

16 more limited. You either deny or you remand for

17 additional testimony.

18 If you think the test of the Siting Board

19 has been met in the recommended order prepared

20 by the hearing officer, and anything additional

21 that you hear is towards the public interest,

22 you can add those conditions, accept

23 certification with those additional conditions,

24 and move forward.

25 COMMISSIONER BROGAN: All right. And I --

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1 we need to get going with this, Governor, and I

2 agree with you. I just --

3 GOVERNOR CHILES: Yes, sir. We've taken

4 30 minutes --

5 COMMISSIONER BROGAN: -- we'll be back

6 before the vote to make sure we all agree before

7 the vote is taken.

8 MR. ODOM: Yes, sir. Thank you.

9 MR. GREEN: The next speaker is

10 Captain Brian Basel with the U.S. Coast Guard

11 from Tampa.

12 Captain Basel.

13 CAPTAIN BASEL: Good afternoon, Governor.

14 GOVERNOR CHILES: Good afternoon.

15 CAPTAIN BASEL: I appreciate your

16 invitation to come to address you and your

17 Cabinet on shipping safety and spill prevention,

18 preparedness, and response, and to answer any

19 questions that you may have.

20 I'm the Commanding Officer of the

21 Coast Guard Marine Safety Office in Tampa. As

22 such, I wear several hats.

23 One is Officer in Charge of Marine

24 Inspection. In this role, I am responsible for

25 the inspection of all commercial vessels

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1 operating on the west coast of Florida, from

2 small passenger vessels to large oceangoing tank

3 ships.

4 In this role, I am also responsible for the

5 enforcement of marine licensing of vessel

6 operators and for the investigations of all

7 marine casualties.

8 Another hat is as the Captain of the Port.

9 I am in charge with ensuring the safe movement

10 of vessels.

11 In addition, I am also the predesignated

12 Federal On-Scene Coordinator for spill response

13 on the west coast of Florida.

14 In other words, I am the person in the hot

15 seat where there is a spill.

16 Please don't think that my decisions are

17 made in a vacuum. Among the experts at my side

18 would be the NOAA Scientific Support Coordinator

19 on environmental issues. A regional response

20 team of all Federal agencies, and State reps is

21 also available to advise on specific concerns.

22 Internally on major incidents, the

23 Coast Guard will analyze every decision that I

24 make, what is known as an Incident Specific

25 Pollution Report.

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1 And externally, I'm all too aware that

2 every decision will be Monday morning

3 quarterbacked.

4 My entire 25 years in the Coast Guard has

5 been in the field of marine safety. My

6 assignments have taken me to all coasts, and

7 have included positions as the Executive Officer

8 and Alternate Captain of the Port of Honolulu,

9 and as Captain of the Port of Cleveland.

10 My assignments have also required extensive

11 travel to more than 40 overseas countries

12 throughout Europe, Africa, the Middle East, and

13 Asia on U.S. vessel inspection and response

14 issues.

15 Most recently, I was the Chief of the

16 Quality Assurance Staff for the Assistant

17 Commandant for Marine Safety and Environmental

18 Protection at U.S. Coast Guard headquarters in

19 Washington, D.C.

20 That assignment included four years of

21 oversight of the structural concerns, and other

22 issues, affecting tank ships operating

23 worldwide, and particularly in the Alaska to

24 west coast trade.

25 As Federal agents, the Coast Guard does not

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1 endorse any product, any service, or any trade.

2 Our role is -- our role is to ensure safety.

3 And that is the safety of passengers; the safety

4 of cargo; safety of the vessels; safety of the

5 crews; the safety of the port; and, of course,

6 the safety of the environment.

7 We do this by ensuring national and

8 international standards are fully complied with,

9 we encourage both the owners and operators to go

10 beyond minimum requirements.

11 I most strongly believe that the greatest

12 focus must be on prevention. Simultaneously, we

13 must also retain the strongest possible response

14 posture.

15 Several years ago, orimulsion

16 representatives approached the Coast Guard and

17 discussed procedures to ensure the safest

18 possible transportation of orimulsion.

19 In addition to mandatory tank ship

20 requirements, many additional initiatives, which

21 go beyond the regulations, were adopted

22 voluntarily.

23 These include many from Alaska and the

24 west coast states, and which were highly

25 controversial for a variety of reasons.

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1 The focus was to attempt to eliminate every

2 possible means for a spill to occur.

3 At this time, I'd like to review the

4 existing requirements for all tank ships

5 entering U.S. waters, and to further discuss the

6 prevention and response measures that

7 Bitor America has adopted for orimulsion that

8 exceed the regulations.

9 I'd also like to briefly show you an

10 analysis of nearly 20 years of U.S. spill

11 casualties, and how lessons learned from those

12 incidents help to arrive at the proposed spill

13 prevention methods.

14 I'd also like to briefly show the traffic,

15 the cargos, the threats that exist on Tampa Bay;

16 and how the Coast Guard, the marine industry,

17 and the community is prepared to meet any

18 incidents.

19 I'd also like to briefly discuss the status

20 of the new Tampa Bay Harbor Safety Committee in

21 its partnership role with the Coast Guard. This

22 committee was formed as a follow-along to the

23 Florida State Chartered Vessel Traffic

24 Information System Consortium.

25 The stakeholders of the Bay are moving

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1 ahead aggressively with its implementation, and

2 we expect to have a system in place prior to the

3 end of this year. This system will further

4 improve safety for all vessels on the Bay,

5 including those carrying orimulsion.

6 Just as a quick overview, this slide is all

7 of the requirements that every tank ship

8 entering U.S. waters must have, listing

9 equipment, international certificates,

10 inspections that are done, and tests that are

11 done before a vessel enters.

12 Just briefly, there are systems such as

13 dual, independent, totally redundant steering

14 systems; dual radars; and a host of other

15 features.

16 International certificates, such as the

17 Safety Equipment Certificate, listing all the

18 required equipment; safety construction

19 equipment for the standards that the vessel is

20 being maintained to; and IOPP, or International

21 Oil Pollution Prevention Certificate, lists all

22 of the pollution prevention equipment on board

23 so that can be readily inspected.

24 The SafeManning Certificate designating the

25 minimum safe manning for that vessel. And an

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1 ISM Certificate, which is the International

2 Safety Management Certificate, which is a new

3 certificate which will go into effect in July of

4 1998, where inspectors are now moving away from

5 the -- moving beyond just technical

6 requirements, and moving into the corporate

7 culture of a company.

8 What is done in the company is reflected in

9 the conditions on a vessel. And it's a new way

10 of doing business worldwide.

11 The U.S. Coast Guard inspects or screens

12 every single vessel that comes into

13 U.S. waters. We do this by a requirement for a

14 24-hour advanced notification. We screen the

15 computer screen files; the violation histories;

16 we score the flag on the vessel; the class--

17 classification society that surveys the vessel;

18 and we're looking for interventions, and

19 so forth. This all goes into a matrix.

20 If a vessel doesn't meet our criteria, it

21 stays offshore until inspectors can board it.

22 Other criteria may allow a vessel to enter, but

23 not do cargo operations until inspectors visit

24 it.

25 There are other tests that are done before

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1 a vessel enters: Steering systems, rudders,

2 engines, and so forth. Violation of any of

3 these standards is very strict. Each one can

4 bring up to a $25,000 fine for the failure to

5 conduct a test, or for the failure to report --

6 failure to report any outages of equipment.

7 Next slide, please.

8 This slide lists spill prevention methods

9 for orimulsion. Again, these are the ones that

10 go beyond the existing regulations. Every

11 vessel that comes in will have a double hull.

12 This is not yet required until the year 2015.

13 Essentially this is a ship within a ship, with a

14 6 foot space between the two hulls, which is

15 filled with all the strength members, the

16 girders, the frames, the webs, and so forth.

17 Essentially with this type of ship, it is

18 almost impossible for any spill to occur in

19 Tampa Bay. This type of ship could run aground

20 at full speed, and it would be unlikely with the

21 Tampa Bay -- where the -- even the outer hull,

22 let alone the inner hull, would ever be

23 breached.

24 As of today, there are no double hull

25 vessels operating even in Alaska.

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1 Doubling walled transfer hoses. Probably

2 three-quarters of all incidents occur during the

3 transfer process. Transfer hose is typically

4 the weakest link.

5 The orimulsion people have designed a hose

6 within a hose that can take that pressure,

7 should there ever be an incident.

8 The third item, the 840,000 gallon spare

9 cargo tank for emergency transfer. This is a

10 requirement of Manatee County. That's a fairly

11 significant size tank that would be kept empty

12 should there ever be a leak in any kind of a

13 tank, still obviously contained within the outer

14 hull.

15 Vessel booming alongside the pier with

16 special orimulsion boom. Offshore routing,

17 minimum of 10 miles, an item highly

18 controversial in California, not an issue in

19 Florida.

20 The vessel will be equipped with a global

21 positioning system. This is a system based on

22 16 satellites orbiting the earth. It provides

23 the position of the ship every 3 seconds within

24 10 feet, which is pretty impressive when you're

25 looking at a 700 foot ship.

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1 The vessel will be escorted from Egmont Key

2 to the pier with a tug escort -- two tug

3 escorts, tractor tugs; state of the art;

4 6,000 horsepower; tied on; immediately ready to

5 take control should there be any kind of an

6 emergency.

7 Orimulsion representatives have requested a

8 1,000 yard moving safety zone. This is a --

9 essentially it closes the Bay down, it's one-way

10 traffic, no vessels allowed within 1,000 yards.

11 We use these currently for ammonia carriers that

12 come up the Bay, and other ships that are

13 carrying liquefied petroleum gas.

14 They have stated they will participate in

15 the vessel traffic system that's being developed

16 on the Bay.

17 It will enter only with a minimum of 3-mile

18 visibility, on tide, with slack water.

19 Slack water is probably the least difficult

20 navigational scenario, and it also provides the

21 maximum time to respond in the event of any

22 incident.

23 Vessel will have anchors ready, emergency

24 tow lines hanging at the water, fore and aft;

25 vessel will go to the -- direct to the dock, it

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1 will not anchor anywhere.

2 The vessel will have segregated piping.

3 This is piping dedicated only to the cargo and

4 cargo tanks, no discharges over the side.

5 Everything must go up to the deck and out

6 through the manifold.

7 The double hull is used for the water

8 ballast to bring the ship's propellers and

9 rudders back down for the empty transit back to

10 Venezuela.

11 Overfill devices, this is a safety feature

12 during loading in Venezuela. The vessel will

13 have oversized engines and rudders, which is

14 important for the 90 degree turn from the Bay

15 into Port Manatee.

16 And the vessel will only be classed by a

17 member of the International Association of Class

18 Societies. These are eleven big ones

19 worldwide: Lloyds Register, the American Bureau

20 of Shipping, and others.

21 It will not be one of the 40-odd

22 fly-by-night outfits such as Belize and Honduras

23 and so forth that -- whose certification is

24 really just a revenue earning operation.

25 Regarding spill response preparedness, this

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1 also includes some other resources. I'd like to

2 start with, on an insurance side, the

3 Coast Guard requires every vessel that carries

4 more than 250 barrels of oil to carry a

5 Certificate of Financial Responsibility. For a

6 tank ship, this is typically about one hundred

7 million dollars. No ship can come in without

8 that.

9 This -- this money is maintained in the

10 Oil Spill Liability Trust Fund, which is --

11 which is controlled by the Coast Guard's

12 National Pollution Fund Center. This is a one

13 billion dollar fund that is available to me as

14 the On-Scene Coordinator in the event that it is

15 needed in any kind of an oil spill.

16 The '93 oil spill, the cleanup costs were

17 approximately one hundred million dollars.

18 The other listing is additional insurance

19 that the orimulsion representatives have said

20 they will provide beyond existing requirements.

21 The vessel must have a U.S. Coast Guard

22 Vessel Response Plan on how it would respond to

23 any incident. This is not a local plan. This

24 is done -- this is reviewed by Coast Guard

25 headquarters, the Office of Response.

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1 In addition, they have to have an

2 international plan, Shipboard Oil Pollution

3 Emergency Plan, which is provided by the flag of

4 the nation that the ship is flying.

5 There's also other equipment that the

6 owners have elected to provide: Special boom,

7 20,000 feet, 5,000 feet of oriboom, a system

8 called forced adhesion and flotation.

9 This will be a separation type of cleanup.

10 Essentially the term that's been used

11 occasionally is being able to take the chocolate

12 out of the chocolate milk.

13 And there will also be a skimmer, the --

14 the tar hawg to remove the bitumen from the

15 surface of the water.

16 They have contracted with National Response

17 Corporation, which is the largest cleanup

18 contractor in the U.S.; also Clean Caribbean

19 Cooperative; as well as Florida Spill Control

20 Assocation. All of these systems have a

21 cascading type of system for a large system.

22 For an event of any large spill, they move in to

23 backup systems, essentially nationwide, or even

24 worldwide.

25 We routinely do drills and exercises,

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1 including quarterly unannounced drills of

2 facilities.

3 We've recently done some with

4 Florida Power Corp., with Tampa Electric, with

5 Marathon, with -- I'm sorry -- with

6 Mariani Asphalt, with Chevron. And I understand

7 Florida Power & Light has got a big drill next

8 month over in Fort Lauderdale.

9 This chart here, and I'd like to focus on

10 the right-hand side of it from 1989. These are

11 total amount of oil lost by spills in U.S.

12 waters.

13 1989 is the Exxon Valdez that you see very

14 high. The next one is the Megaborg in the

15 Gulf. My intent here is to say, is today's

16 response system working; and my answer is, yes,

17 it is.

18 I don't believe that that is an anomaly in

19 the last five years. This is a study that was

20 done by the Oil Pollution Bulletin, and it

21 lists, and I will quote here: The petroleum and

22 shipping industries, and other groups, have

23 undertaken voluntary spill prevention

24 initiatives, including stricter environmental

25 standards, improved training, vessel routing

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1 changes, and increased cooperation with the

2 U.S. Coast Guard and other Federal and State

3 regulatory agencies to achieve that standard

4 that we see right there.

5 In order to arrive at the spill prevention

6 standards that we mentioned, we analyzed the

7 casualties -- the main casualties of tanker

8 spills in the U.S.

9 The first graph -- the first part of it you

10 see there is groundings. The orimulsion

11 representatives have asked for -- and I've

12 mentioned tug escorts, high tide, slack water,

13 double hull, 3-mile visibility, tow lines ready,

14 anchors ready. All of these help prevent

15 collisions -- I'm sorry -- groundings.

16 As we move into transfer accidents,

17 double walled hoses.

18 We move to the next one on collisions. I

19 talked safety zones, the one-way traffic,

20 tug escorts, visibilities, and participation in

21 the vessel traffic system.

22 If we move into equipment failure, I

23 mentioned the classification society surveys,

24 the Coast Guard Post State Control inspections;

25 and, again, tug escorts.

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1 Move into rammings, these are of docks.

2 Tug escorts already on; oversized engines;

3 oversided rudders.

4 Structural failures; again, the class

5 society of Coast Guard inspections.

6 And fire is not necessarily an issue here.

7 So we've tried to analyze every casualty,

8 the type -- the standard types of casualty

9 nationwide to ensure that these will not happen

10 with any vessel coming into Tampa.

11 On Tampa Bay, we've got the types of spills

12 are classified, and this is how we prepare our

13 contingencies. Under most probable, the most

14 probable is a simple 25 to 75 gallon spill. My

15 actual typical spill is less than 10 gallons.

16 It's diesel; it's daylight; it's in commercial

17 fishing vessel areas; and, in fact, the area

18 that's most common is Tarpon Springs outside the

19 Bay. This is where we put our focus when we get

20 this kind of analysis.

21 The most probable spill that we're using

22 for orimulsion is 50 barrels at 2100 gallons.

23 This is for a ship the average most probable

24 spill.

25 The maximum that is most probable is

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1 defined as the largest spill in the last

2 five years. This is the 380,000 gallons from

3 the three-vessel collision of 1993, and involved

4 both gasoline, jet fuel, diesel, and number 6

5 heavy fuel oil.

6 For orimulsion, we've done modeling with

7 10,000 barrels, which is forty --

8 420,000 gallons for their orimulsion maximum

9 most probable.

10 To prepare for a worst case, which is the

11 total failure of any storage tanker, any vessel,

12 we do a drill -- worst case drill every

13 three years. One was done in 1995 with Citgo.

14 Two years later, just last month, we did one

15 with Tampa Electric, with its catastrophic

16 collapse of a tank in Tampa --

17 (Treasurer Nelson exited the room.)

18 CAPTAIN BASEL: -- and the subsequent

19 spill.

20 The reason we did this out of sync is that

21 the Coast Guard provided Texas A&M with a

22 1.25 million dollar grant to develop a portable

23 computer spill control simulator that the

24 industry could use in their own spill

25 scenarios.

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1 We are scheduled for another one in 1998,

2 and will be looking for volunteers as we move

3 ahead with that spill -- spill drill.

4 This page here is one page out of about a

5 3-inch document called the Area Contingency

6 Plan. This plan was put together with thousands

7 of hours of work of Federal, Coast Guard, NOAA,

8 state, local, environmental groups, responders

9 to carefully lay out every inch of shoreline in

10 Florida and nationwide.

11 What it shows here -- it's a little

12 difficult to read -- our key contacts; shoreline

13 habitat to be protected; wildlife resources to

14 be protected; endangered species; including the

15 seasons that they're there; access to various

16 areas, how to get there; and other available

17 resources.

18 This next -- this next slide here is the

19 actual map that goes with that page. And what

20 we have here is Egmont Key in the lower left,

21 and Fort DeSoto, and that's the Skyway Bridge.

22 What we're showing here, we have preplanned

23 booming strategies for every inch of coastline.

24 We list the highest protection priorities, and

25 we move down to other areas to be protected

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1 after that.

2 We list collection points, we list turtle

3 nesting areas, mangroves, boat ramps,

4 facilities, marinas, manatee areas, water

5 intakes, booming areas, and bird brokeries.

6 Essentially, we have everything already

7 preplanned in our plan, and the -- we also have

8 an identical plan for orimulsion.

9 Just briefly, the threats on Tampa Bay. In

10 the lower left is Egmont Key and Fort DeSoto

11 where you see the zero mile mark; approximately

12 15 miles out is the sea buoy; you go 45 miles

13 into Tampa Bay.

14 It's a narrow channel, 500 to 1,000 feet

15 wide, running up the center of the Bay, about

16 45 miles into Tampa.

17 In Tampa, over in St. Pete, and down at

18 Port Manatee where you see the dead ends are the

19 power plants and where the other cargos, the

20 ammonia, the LPG, and so forth, go.

21 Traveling on the Bay in any given year is

22 approximately 3300 deep draft vessels that must

23 stay in the channel for an equivalent of

24 6600 transits of the Bay. This is not an

25 unmanageable number. Essentially that's one

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1 ship an hour.

2 Breaking out those transits is

3 approximately a 50/50 match between general

4 cargo and passengers and tank vessels.

5 The reason I break out the general cargo

6 and passengers is to note that these type of

7 vessels carry all of their fuel oil, which is a

8 heavy fuel oil, in their double bottom. So

9 anything leaving Tampa is loaded with fuel oil

10 on the way out.

11 If a tank vessel is listed, these are the

12 cargos that it carried on Tampa Bay. Products,

13 by this, I mean gasoline, jet fuel, your

14 flammables. You see quite a few of that. This

15 is going to the storage tanks, to the airport,

16 to MacDill Air Force Base.

17 Also, a considerable number of heavy fuel

18 oil shipments. These are your number 6, your

19 tar-like that are going to the power plants and

20 to fuel the ships that are leaving the Bay.

21 In addition to that, we have an even

22 heavier heavy fuel oil, which is known as a

23 LAPIO, Low A-P-I Oil, which means it has a

24 specific gravity of greater than 1, and it can

25 sink.

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1 This is the oil that's of concern to me.

2 To bring these vessels in safely, I use Captain

3 of the Port orders where they have to have tug

4 escorts in certain areas in the event that

5 something happens.

6 And these vessels are typically in single

7 hull, and generally fairly old, because most of

8 them are in U.S. vessels.

9 We also have a considerable amount of LPG

10 and ammonia coming up the Bay. And to ensure

11 the safety of these vessels, we use safety

12 zones. Essentially I close the Bay for the

13 entire transit of up to 4 hours, and nobody is

14 allowed to get near these vessels.

15 Of course, molten sulphur, what -- as I

16 understand it, there'll be approximately

17 55 orimulsion vessels, perhaps up to 155 being

18 the number of vessels, if the largest possible

19 vessel is carrying the cargo. That is

20 essentially only 2 to 4 percent of the traffic

21 on the Bay.

22 And when you look at those cargos that were

23 up there from the risk management and from the

24 spill prevention point of view, perhaps with the

25 exception of those barges only carrying coal,

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1 orimulsion probably represents the least risk on

2 the Bay.

3 The items that I've mentioned as far as

4 spill prevention and for groundings and

5 collisions, the safety zones and tug escorts and

6 so forth, if you notice over the last five years

7 on groundings, we've been able to reduce the

8 groundings by more than 65 percent. I think we

9 can still do that better.

10 That still comes up to an expected eight

11 groundings per year, which we consider

12 unacceptable. I believe that the vessel traffic

13 system will considerably improve that.

14 To implement some of the regulations, we

15 have moved ahead with the consortium report, and

16 we have created a Tampa Bay Harbor Safety

17 Committee, which is made up of all stakeholders

18 of the Bay.

19 As can be seen here, from the

20 Port Authority directors to petroleum phosphate

21 to tug barge outfits, passenger vessels,

22 recreational, environmental reps, to the Agency

23 on Bay Management, and other organizations that

24 are there. This will be the Board of Directors

25 of Tampa Bay.

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1 The purpose of that consortium is simply to

2 enhance and ensure port safety, environmental

3 safety, and vessel safety. And we plan to do it

4 in a cooperative, public and private sector

5 partnership; and we plan to do it before the end

6 of 1997.

7 (Treasurer Nelson entered the room.)

8 CAPTAIN BASEL: Our conclusions, based on

9 the spill potential, are very low. Spill

10 prevention strategies, which is a compilation of

11 the best on the Bay and elsewhere, are

12 excellent, and we believe that use of this type

13 of preventing strategy will probably raise

14 standards worldwide.

15 We believe the spill response strategies

16 are innovative and excellent.

17 In summary, again, I want to emphasize that

18 the Coast Guard does not endorse any product.

19 From a prevention and a response posture, and,

20 again, from the person who is in -- who will be

21 in the hot seat, the Coast Guard role is to

22 ensure the safe transportation of orimulsion.

23 I welcome any questions.

24 Thank you.

25 GOVERNOR CHILES: Other questions.

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1 Captain, we thank you for your appearance.

2 CAPTAIN BASEL: Thank you very much.

3 GOVERNOR CHILES: Yes, sir.

4 MR. GREEN: Julie Greene with the Tampa Bay

5 Regional Planning Council is next.

6 MS. GREENE: Governor, Cabinet members, my

7 name is Julia Greene. I'm the

8 Executive Director of Tampa Bay Regional

9 Planning Council.

10 The Tampa Bay Regional Planning Council

11 formally participated in the review of the site

12 certification application by the

13 Florida Power & Light Company.

14 The application was for conversion of the

15 company's plan in Manatee County to burn

16 orimulsion or high sulfur fuel oil. The use of

17 orimulsion was the focus of the review because

18 it was a fuel unknown to the region, the state,

19 or the nation.

20 The fuel's potential air quality impacts,

21 if burned in the current facilities, and the

22 physical properties when released into salty

23 water, were of great concern during the staff

24 review.

25 Other aspects of the project, including the

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1 plan to add several hundred heavy truck trips to

2 the regional roadway system, and to create an

3 on-site fly ash and gypsum disposal site were

4 among the regional concerns.

5 Florida Power & Light Company committed to

6 many measures to reduce the expected impacts of

7 the project.

8 These included high technology scrubbers to

9 remove most of the noxious elements and

10 chemicals from the smokestacks, and recycling of

11 waste product produced by the air emission

12 cleansing process.

13 Concurrent to the staff's review of the --

14 the Agency on Bay Management, which is the

15 Council's natural resources committee, also

16 reviewed the application for its potential

17 impacts on the region's environmental resources,

18 particularly Tampa Bay.

19 The Council recommended approval of the

20 project, but only with the inclusion of a number

21 of strenuous conditions, which it felt would

22 resolve its concerns.

23 The Agency on Bay Management, and I quote:

24 The certification be denied unless and until all

25 the concerns listed are resolved such that the

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1 natural sources of the Tampa Bay will not be at

2 risk.

3 Subsequent to the Council's recommendation,

4 several developments occurred pertaining

5 directly to stated Council and Agency on Bay

6 Management concerns. Specifically, let me

7 summarize the concerns that were addressed in

8 the report.

9 First, the Council recommended that the

10 project be certified only if the company

11 employed selective catalytic reduction, or other

12 technology, to achieve the same or lower rates

13 of nitrogen oxides emissions as at present.

14 The Agency on Bay Management had also

15 expressed grave concerns about increasing the

16 amount of nitrogen oxides emitted, both as a

17 source of additional nitrogen to the Bay, but as

18 also a precursor of carbon monoxide.

19 FP&L has refined its emissions control

20 technology, and will be able to operate any

21 increase in nitrogen oxide emissions --

22 excuse me -- without any increase over the

23 current rates.

24 Additionally, if the treated wastewater is

25 used for cooling, this will result in a

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1 reduction of nitrogen loading to the Bay.

2 Second, the Council recommended that FP&L

3 post a financial bond, or other legally binding

4 means of ensuring its participation in the

5 prevention of a controlled cleanup of any

6 orimulsion spill during transport.

7 As well --

8 (Attorney General Butterworth exited the

9 room.)

10 MS. GREENE: -- as participating in the

11 funding of the vessel tracking information

12 system for Tampa Bay.

13 The Agency on Bay Management expressed

14 similar concerns demanding assurance that all

15 precautions would be taken to minimize the

16 likelihood of a spill.

17 FP&L has not accepted the responsibility

18 for the fuel prior to unloading. However,

19 Bitor America has committed to carrying

20 1.2 billion dollars in pollution liability

21 insurance, almost one billion more than is

22 Federally required.

23 Companies have also committed to the use of

24 special measures during unloading to minimize

25 the chance of a spill, and to control any spill

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1 at the dock.

2 Further, FP&L has committed to contribute

3 1 million dollars toward the vessel tracking

4 information system currently planned for the

5 Bay.

6 Third, the Council recommended requiring

7 the availability at Port Manatee of the best

8 known -- the best equipment known for control

9 and removal of orimulsion from salt water, with

10 sufficiently trained personnel located in the

11 region.

12 The Agency on Bay Management additionally

13 expressed concerns on the Bay's aquatic

14 preserves.

15 The orimulsion shipping plan prepared by

16 Bitor America, including the spill recovery

17 plan, has received high praise from the

18 U.S. Coast Guard's Marine Safety office and the

19 Captain of the Port as the most complete and

20 conscientious plan in the nation, if not the

21 world.

22 While the chances of a spill will never be

23 zero, the measures to be enacted by Bitor,

24 including the use of double hulled ships, tug

25 assist, visibility standards, and moving safety

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1 zone, and other features, will make this the

2 safest shipment of fuel into Tampa Bay.

3 Prevention of spill is of paramount

4 importance, because we know that cleanup of any

5 fuel is -- is never complete without natural

6 resources impacts.

7 Bitor has developed techniques and

8 machinery to recover spilled orimulsion, and

9 commits to having sufficient boom equipment and

10 trained personnel to respond rapidly.

11 Fourth, the Council recommended that the

12 consensus be gained from the authorities that

13 proposed additional freshwater withdrawals from

14 the Little Manatee River would not significantly

15 impact the river or the Cockroach Bay Aquatic

16 Preserve.

17 It is also recommended that the nondamaging

18 freshwater withdrawal rate and timing be set

19 forth in the certification order.

20 The Agency requested that alternative

21 sources be thoroughly explored.

22 Subsequent research and discussion with

23 Water Management District and Manatee County

24 resulted in a plan to use reclaimed wastewater

25 and groundwater to supplement the plant's

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1 cooling water needs, greatly reducing dependence

2 on the Little Manatee River.

3 Finally, the Council requested that FP&L

4 cooperate with the Florida Department of

5 Transportation to correct any degradation to

6 State Road 62 resulting from the expected

7 increase in heavy truck traffic from the Manatee

8 plant.

9 Recently, the company revealed that it has

10 developed a plan to ship waste products

11 primarily by rail, reducing truck trips to

12 60 per day, and avoiding school bus peak

13 operating hours. This resolves the Council's

14 concern for public safety and highway integrity.

15 Another commitment made by FP&L toward the

16 recovery of the Tampa Bay estuary is the

17 establishment of the Tampa Bay Environmental

18 Enhancement Trust, a serious obligation which

19 will provide tremendous opportunities for

20 habitat restoration, water quality improvement,

21 and other identified needs.

22 Staff of the Regional Planning Council has

23 met with experts on several of these issues, and

24 now believe the project, including the recent

25 commitments by FP&L and Bitor America,

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1 sufficiently resolve the concerns and conditions

2 recommended in the Council's final report.

3 The Agency on Bay Management held a forum

4 on June 10th and received positive responses to

5 its concerns, but has not taken a formal

6 position on the revised project.

7 In closing, I speak for the Tampa Bay

8 Regional Planning Council in saying that the

9 Manatee conversion plant, as currently

10 presented, offers a tremendous opportunity for

11 the State of Florida, Tampa Bay community, to

12 move toward a safer, more reliable fuel source.

13 Considering the likelihood that orimulsion

14 will be accepted somewhere in the United States

15 in the near future, I think we have the good

16 fortunate to be first.

17 The Tampa Bay community is very, very

18 protective of its estuary. The local

19 governments have been strongly united on Bay

20 issues, and our Bay management efforts are a

21 national model on how to achieve measurable

22 success.

23 We want nothing to jeopardize the

24 tremendous progress that has been made toward

25 Tampa Bay's recovery. If we were to say no to

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1 orimulsion, another community that is less

2 environmentally sensitive than ours will set the

3 standard, and the -- for the shipment and

4 handling and the use.

5 We may then face a very difficult challenge

6 of overcoming precedent to try to achieve what

7 we have already earned as a result of steadfast

8 determination and technical competence.

9 Given the concessions made by these

10 companies to exceed the required standards for

11 shipping, spill contingency planning, freshwater

12 use, air emissions handling, waste disposal, and

13 environmental enhancement, we're able to set the

14 precedent for the rest of the country.

15 The Tampa Bay community has long been known

16 for its willingness to tackle issues and achieve

17 success.

18 The proposal for the use of orimulsion, if

19 granted certification with conditions to reflect

20 the company's commitments in the areas I've

21 mentioned, will accomplish far more than

22 providing safer fuel shipment in Tampa Bay.

23 It will send a message to other regions and

24 communities that the community can raise the bar

25 above the minimum standards set by government,

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1 and that energy and fuel providers must respect

2 the environment and the community when

3 conducting their business.

4 Thank you for your attention. I'll be

5 happy to answer any questions.

6 GOVERNOR CHILES: Thank you, ma'am.

7 Are there questions?

8 SECRETARY MORTHAM: Yes. I --

9 GOVERNOR CHILES: You have a question?

10 SECRETARY MORTHAM: Ms. Greene, can you

11 tell me, first of all, if the Tampa Bay Regional

12 Planning Council voted on this issue?

13 MS. GREENE: Yes, they did.

14 SECRETARY MORTHAM: And what was --

15 MS. GREENE: They issued a report that I

16 mentioned that I outlined. This would have been

17 in July of -- two years ago. So that would have

18 been '95.

19 That would have been the -- outlining the

20 issues. We follow a formal standard that is set

21 out by the review process in which we look at

22 something, determine what the condition should

23 be, and made a determination then, and outlined

24 those conditions that they would need to meet in

25 order to get the Council's support in this

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1 project.

2 And we feel like they have met those

3 conditions that the Council set forth.

4 SECRETARY MORTHAM: When was the vote

5 taken?

6 MS. GREENE: In June -- at the July Council

7 meeting in -- two years ago.

8 SECRETARY MORTHAM: In '95.

9 MS. GREENE: That would be '95. Yes,

10 that's correct.

11 SECRETARY MORTHAM: Okay. And could you

12 tell me what that vote was?

13 MS. GREENE: No, I could not. Not at this

14 point, no. I don't --

15 SECRETARY MORTHAM: Okay.

16 MS. GREENE: But it was not a close vote.

17 It was -- it was pretty significantly in favor

18 of the report.

19 SECRETARY MORTHAM: Okay. And you

20 mentioned the tracking system for Tampa Bay --

21 MS. GREENE: That's correct.

22 SECRETARY MORTHAM: -- which I know has

23 been --

24 MS. GREENE: Yes.

25 SECRETARY MORTHAM: -- discussed for years.

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1 MS. GREENE: Yes.

2 SECRETARY MORTHAM: How much is the total

3 tracking system?

4 MS. GREENE: The tracking system -- we've

5 worked with them a lot of times, and we've been

6 very successful in getting some combinations.

7 But it runs anywhere from 250,000 up to a

8 million dollars. There's quite a gap. But it's

9 very difficult to get those figures. We've

10 tried to get them from the folks that run that

11 program, but we've been able to get that thing

12 up and going.

13 SECRETARY MORTHAM: Okay. Thank you.

14 MS. GREENE: It's very important to our

15 Bay.

16 GOVERNOR CHILES: Further question?

17 Thank you, ma'am.

18 MR. GREEN: Governor, that ends the

19 testimony from public agencies, and we're

20 beginning to start the -- the two sides.

21 The first speaker will be for

22 Florida Power & Light, will be

23 Peter Cunningham. He's asked that this side be

24 reserved 30 minutes of their time for rebuttal

25 at the end of the presentations.

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1 GOVERNOR CHILES: All right.

2 MR. CUNNINGHAM: Governor Chiles --

3 GOVERNOR CHILES: Uh-hum.

4 MR. CUNNINGHAM: -- members of the Cabinet,

5 good afternoon. I'm Peter Cunningham with the

6 law firm of Hopping, Green, Sams & Smith on

7 behalf of Florida Power & Light Company.

8 With me are -- today are several people

9 that I would like to have talk with you about

10 FPL's orimulsion project, including the

11 President of Florida Power & Light Company;

12 three of the many scientists and experts who

13 testified before Administrative Law Judge

14 Johnston; and the Mayor of Dalhousie,

15 New Brunswick, who has come down from Canada to

16 talk with you.

17 Also here in case of questions are the

18 President of Bitor U.S.A., the fuel supplier;

19 the President of Pure Air, which is the supplier

20 of the air pollution control equipment for the

21 project; as well as many other technical and

22 scientific experts who have analyzed this

23 project over the past three or four years.

24 I do understand that several other people

25 have signed up to speak in favor of the

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1 project. And as Mr. Green said, I would like to

2 reserve a half hour for some of them, and for

3 rebuttal if we think that's appropriate.

4 So here we are again. I'm not here to give

5 testimony. In fact, it's my view that you're

6 not here to take testimony in the normal sense

7 of that word. I think what you hear today in

8 your capacity as the Siting Board is in the

9 realm of oral argument, or perhaps statements of

10 position.

11 To take the analogy, this is not like

12 taking evidence after the jury's gone out, it's

13 rather setting the sentence.

14 The decision before the Board today is very

15 simply whether FPL's Manatee Power Plant will

16 continue to burn oil, or will be allowed to burn

17 orimulsion.

18 In contrast to other projects that have

19 come before the Board under the Power Plant

20 Siting Act, the question is not whether a new

21 plant should be approved. The Manatee plant is

22 there already; it's been operating for more than

23 20 years; and it will continue operating,

24 whatever this Board decides.

25 I'm here to ask you to approve the

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1 conversion to orimulsion. If you do, it'll mean

2 cleaner air, a safer bay, and lower electricity

3 costs for 7 million Floridians.

4 Those are fundamental facts demonstrated

5 through the most searching and comprehensive

6 review ever conducted for a power plant in this

7 state. The Power Plant Siting Act process was

8 initiated for this project way back in

9 September 1994 with a six volume application

10 that FPL filed.

11 In my view, this was a good project to

12 begin with; not perfect, but good. Over the

13 next year, the project was improved as the

14 process unfolded with over 200 sufficiency

15 questions from all the various agencies involved

16 at the state, regional, and local levels,

17 answered in writing by FPL.

18 Ultimately when negotiation of the over

19 100 pages of Conditions of Certification,

20 including lower NOx emissions through the --

21 through the effects of negotiations with DEP,

22 Hillsborough, and Pinellas Counties;

23 extraordinary shipping safety and spill response

24 measures, due largely to pressures from

25 Manatee County; constraints on trucking and

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1 requirements for traffic improvements, due to

2 Manatee County; and a requirement to use

3 reclaimed water for cooling water, instead of

4 the Little Manatee River through the Southwest

5 Florida Water Management District, which voted

6 unanimously to recommend approval.

7 And, Secretary Mortham, in answer to your

8 question from Ms. Greene, I believe the vote

9 that day was all in favor except one, and that's

10 a large body that votes at the Regional Planning

11 Council.

12 Well, we got finally to the certification

13 hearing. Judge Johnston conducted a three-week

14 hearing with more than 50 witnesses, 230 pages

15 of exhibits, and over 2400 pages of transcript.

16 Judge Johnston's 148-page recommended

17 order -- and this is truly the operative

18 document of this case -- it contains

19 258 findings of fact. It also contains

20 91 conclusions of law.

21 Based on his consideration of all of the

22 evidence, Judge Johnston unequivocally

23 recommended certification of the project,

24 subject to hundreds of conditions, covering

25 102 pages.

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1 No agency took exception to

2 Judge Johnston's recommended order, and no

3 agency objected to certification of the project.

4 Judge Johnston's 258 findings of fact are

5 the distillation of the evidence in this case.

6 They are the truth of this case. They cannot be

7 ignored. Each finding is clearly based on

8 competent substantial evidence.

9 In the end, this Board's decision must be

10 based on the four criteria in Section 403.5175

11 in the Power Plant Siting Act. Judge Johnston

12 addressed each of these in his recommended

13 order.

14 As to the first, he concluded that the

15 project would meet or exceed all agency

16 standards, with the exception of two

17 Manatee County ordinances, which are not at

18 issue.

19 No agency disputed this conclusion.

20 As to the second, and I have prepared

21 several boards here.

22 And I apologize to the audience, I'll try

23 to read what I view as the highlights for

24 these.

25 I'm not sure that you all can read these

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1 either. I'm not sure I can. But I do have a

2 copy.

3 In any event, Judge Johnston marshaled

4 certain facts under each of these criteria. The

5 first one is the question of whether the project

6 provides environmental or other benefits

7 compared to current operation of the plant --

8 the plant running on oil, as it would continue

9 to, without approval of this project.

10 Judge Johnston said yes, very clearly.

11 Among the environmental or other benefits which

12 he cited, based on his findings, are reduction

13 in the total amount of air emissions from the

14 plant, reduction in human health risks from air

15 emissions, reduction in the total amount of air

16 emissions system-wide in Florida Power & Light's

17 system. He also found that there would be

18 one-fourth the risk of fuel spills in Tampa Bay,

19 and significantly reduced overall risk to

20 Tampa Bay.

21 As economic benefits, he found that -- the

22 4 billion in savings to FPL's customers, he

23 found annual statewide increases in sales and

24 business activity, increased earnings, and

25 2,000 new jobs per year.

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1 He also noted that annual savings to tax

2 supported customers would run on the order

3 between about 2 billion dollars and 22 billion

4 dollars.

5 As to the next criteria, subsection (c),

6 does the project use reasonable and available

7 methods to minimize impacts on human health and

8 the environment. Judge Johnston said yes.

9 Among the facts that he marshaled in that

10 regard were the extraordinary safety measures to

11 minimize risk of spills; scrubbers that will

12 control sulphur dioxide, result in very

13 significant reductions from current levels; and

14 water withdrawals from Little Manatee River

15 being limited in favor of the use of reclaimed

16 water for cooling purposes at the plant.

17 Finally, as to the fourth statutory

18 criteria: Does the project serve and protect

19 the broad interests of the public.

20 Judge Johnston said yes, and these are the

21 facts --

22 (Attorney General Butterworth entered the

23 room.)

24 MR. CUNNINGHAM: -- which he felt led to

25 that conclusion: Lower electric rates to FPL

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1 customers; the project would help ensure jobs,

2 tax revenues, and other benefits from Florida's

3 electric industry; reduction in air emissions

4 locally; reduction in air emissions statewide;

5 reduction in human health risks from air

6 emissions; reduction in the risk of fuel spills

7 in Tampa Bay and statewide; as well as

8 reasonable assurances that the plant will not

9 adversly impact public health, safety, and

10 welfare, fish and wildlife, fishing, water based

11 recreational values, or marine productivity.

12 As I would emphasize, each of these facts

13 marshaled by Judge Johnston under these

14 statutory criteria is supported by the evidence.

15 There is virtually no evidence, and none

16 that he found persuasive to support any other

17 conclusion.

18 Regardless of the weight afforded to any

19 particular fact, or any criterion, the weight on

20 the plus side of the scale leads overwhelmingly

21 to the conclusion that the project, with the

22 100 pages of conditions recommended by various

23 agencies, and the Administrative Law Judge, does

24 meet the statutory tests and merit

25 certification.

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1 But as we all know, on April 23rd, 1996,

2 four of you said no.

3 The Board's decision was a tough blow, to

4 me personally, and professionally; to FPL; to

5 Bitor; to Pure Air. But through some very hard

6 times, we continued to believe in the project,

7 enough to seek review in the First District

8 Court of Appeal, and enough to keep trying to

9 make the project better, to learn from our

10 mistakes.

11 While the legal and regulatory basis for

12 approv-- approval was, and is, clear to me, FPL

13 recognized that we had not done as well as we

14 could in communicating to the public about the

15 project, and we had not listened as well as we

16 should have to their concerns.

17 We assumed too much, we knew too little

18 about the opposition of the project, we

19 misjudged the power of confusion when promoted

20 by groups whose only goal is to oppose,

21 augmented by the forces of very major economic

22 competitors.

23 So after your vote of denial last year, FPL

24 and Pure Air asked their representatives in the

25 Tampa Bay area for help in understanding the

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1 local issues, to fashion -- in order to fashion

2 solutions.

3 Those representatives, residents of the

4 area, spent almost a year talking to

5 environmentalists, scientists, regulators,

6 community associations, and elected officials.

7 They found three general areas of concern:

8 First, specific issue concerns, scientific,

9 environmental, about NOx, trucks, and spills;

10 second, general quality of life kind of

11 concerns, particularly from Hillsorough and

12 Pinellas Counties, and others north of the bay,

13 who felt they were being asked to take some risk

14 without any benefit.

15 And in this context, FPL became extremely

16 aware that Tampa Bay is, literally and

17 figuratively, a symbol of the quality of life in

18 that region.

19 And the third concern is a real tough one.

20 It's fear, fear of the unknown, and fear of

21 change.

22 Those local people told FPL, in no

23 uncertain terms, of those concerns. They also

24 told FPL of its failures to understand, the

25 first time, the value of citizen involvement;

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1 the need to educate and include the local

2 community; and to be its partner.

3 To its credit, FPL listened and heard. And

4 on May 13th, before the First District Court of

5 Appeal remanded this case back to you, the

6 manager of Florida Power and Light's Manatee

7 plant briefed the Manatee County Commission on

8 several commitments FPL has decided to make.

9 You've heard about these already.

10 The truth is, they address people's

11 concerns. Without question, and on their face,

12 they further enhance the project and its

13 benefits.

14 I can briefly go through those. And the

15 first issue on which FPL has made a commitment

16 is on the emissions of nitrogen oxides. FPL has

17 said, and I will cite to you, that we will

18 commit to meet a NOx emission limit of 0.15,

19 which is really lower than the limit that the

20 opponents argued for during the hearing,

21 although they suggested it should even be lower.

22 We'd also take limits on daily emissions of

23 NOx during the ozone season, as well as a cap on

24 emissions so that there would be no increase in

25 emissions of NOx emissions, even though the

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1 plant will operate at about two-and-a-half times

2 its higher capacity.

3 If I recall, Treasurer Nelson was very

4 interested in this issue the first time around,

5 and we certainly heard what he said as well.

6 As far as rail and trucking, rail has

7 always been part of this project. We never

8 wanted it to be pushed into rail as the only

9 solution, we didn't want to be captive to one

10 form of transportation.

11 Having heard what the people said, we are

12 now committing to use rail as the primary

13 transport mode, and to limit the number of

14 trucks from the 202 that I talked to you about a

15 year-and-a-half ago, to 30.

16 We're also prepared to agree to no truck

17 traffic in Manatee County during hours when the

18 school buses operate.

19 As far as the fuel transportation and spill

20 issues. As you've heard, FPL has committed to

21 provide 1 million dollars in up-front funding to

22 get the vessel traffic information system, which

23 everyone says is -- is a good thing, and needs

24 to get -- get going, to get that system going.

25 I'm sure that Captain Basel would get it

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1 going anyway. But we're here to provide that

2 help.

3 We have also agreed to provide 500 million

4 dollars in additional pollution liability

5 insurance to bring that to a total of

6 1.25 billion dollars; and on a technical point,

7 to provide some additional skirted boom in the

8 Manatee area in the case of a spill of

9 orimulsion.

10 The other commitments really involve things

11 somewhat more nebulous, but they reflect FPL's

12 commitment to help protect and enhance

13 Tampa Bay, and to be a partner with the

14 communities in which they operate. Ms. Greene

15 mentioned these.

16 But FPL is committed, and we'll accept a

17 condition requiring the establishment of a trust

18 fund for the betterment -- environment

19 enhancement and sustainability of Tampa Bay to

20 be funded to the tune of 10 million dollars per

21 year for 20 years, provided that 90 percent of

22 the fuel cost savings from this project, which

23 are estimated at 4 billion dollars, flow to the

24 customers.

25 We also have proposed establishment of a

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1 trust fund for the Parrish community. This,

2 frankly, was taken from one of the conditions

3 that Commissioner Crawford suggested before

4 y'all voted to deny this project. And we

5 thought we -- I stood up here before you and

6 said we would accept those conditions. And I'm

7 not about to say otherwise today.

8 And in a similar vein, we would establish

9 an environmental review room at the Manatee

10 plant for public access to monitoring data, all

11 these emission monitorings and environmental

12 data; and a condition, again, one proposed by

13 one of the Board members last time, that prior

14 to renewal of a -- our air permit, that DEP

15 would report to the Siting Board regarding

16 compliance with Conditions of Certification and

17 the effect of burning orimulsion on human health

18 and environmental health and safety.

19 So those are the new conditions. They are

20 not new evidence. They are commitments, and a

21 statement of our position. We're telling you

22 that if you impose those conditions, we will not

23 object.

24 FPL has made these commitments

25 unilaterally. FPL will follow through on them

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1 if the project is approved, whether or not the

2 Siting Board chooses to impose them as

3 enforceable conditions.

4 But as stated in our formal filing on

5 August 15th, we will accept them as enforceable

6 conditions of certification if that is

7 the Board's decision.

8 As to these additional commitments, it's

9 critical to distinguish between conditions on

10 the one hand, and findings of fact, or evidence,

11 on the other. And I think you had a dialogue

12 with Mr. Odom about that.

13 These conditions are not inconsistent with

14 the record, and they do not contradict the

15 findings of the hearing officer.

16 Consideration of the additional conditions

17 is not taking new evidence, and their imposition

18 by the Board does not require further

19 evidentiary fact finding.

20 Any more than when Commissioner Crawford