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                                  T H E   C A B I N E T

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



                                 DIVISION OF BOND FINANCE

                            HIGHWAY SAFETY AND MOTOR VEHICLES

                                  DEPARTMENT OF REVENUE



                              STATE BOARD OF ADMINISTRATION

                         The above agencies came to be heard before
               THE FLORIDA CABINET, Honorable Governor Bush presiding, in
               the Cabinet Meeting Room, LL-03, The Capitol, Tallahassee,
               Florida, on Wednesday, May 28, 2003 commencing at
               approximately 9:30 a.m.

                                       Reported by:

                                    KRISTEN L. BENTLEY
                                      Court Reporter

                            ACCURATE STENOTYPE REPORTERS, INC.
                                     100 SALEM COURT
                          TALLAHASSEE, FL  32301   (850)878-2221



                         Representing the Florida Cabinet:

                         JEB BUSH

                         CHARLES H. BRONSON
                         Commissioner of Agriculture

                         CHARLIE CRIST
                         Attorney General

                         TOM GALLAGHER
                                          * * *

                              ACCURATE STENOTYPE REPORTERS, INC.

                                        I N D E X

               (Presented by Ben Watkins)

               ITEM                   ACTION                PAGE
               1                      approved              5
               2                      approved              5
               3                      approved              5
               4                      approved              6

               (Presented by Fred Dickinson)

               ITEM                   ACTION                PAGE
               1                      approved              10
               2                      approved              10
               3                      approved              18

               (Presented by Lisa Echeverri)

               ITEM                   ACTION                PAGE
               1                      approved              19
               2                      approved              20

               (Presented by Teresa Tinker)

               ITEM                   ACTION                PAGE
               1                      approved              21
               2                      approved              22

                              ACCURATE STENOTYPE REPORTERS, INC.


               (Presented by Rob Lovern and David Struhs)

               ITEM                   ACTION                PAGE
               1                      approved              33
               2                      approved as amended   51
               3                      approved              54
               4                      approved              55
               5                      deferred              55
               6                      approved              55
               7                      approved              56
               8                      approved              67
               9                      defferred             67

               (Presented by Coleman Stipanovich)

               ITEM                   ACTION                PAGE
               1                      approved              69
               2                      approved              69
               3                      approved              69
               4                      approved              70
               5                      approved              70
               6                      approved              71

                              ACCURATE STENOTYPE REPORTERS, INC.

                      DIVISION OF BOND FINANCE, May 28, 2003                5
          1                       P R O C E E D I N G S

          2             (The agenda items commenced at 9:30 a.m.)

          3              GOVERNOR BUSH:  The next cabinet meeting will be

          4         June 12th, 2003, a Thursday.  Division of Bond Finance.

          5              COMMISSIONER GALLAGHER:  Motion on the minutes.

          6              COMMISSIONER BRONSON:  Second.

          7              GOVERNOR BUSH:  Moved and seconded.  Without

          8         objection, Item 1 passes.

          9              MR. WATKINS:  Item 2 is a resolution authorizing

         10         the competitive sale of up to $44.6 million in capital

         11         outlay bonds for school construction.

         12              COMMISSIONER GALLAGHER:  Motion on two.

         13              COMMISSIONER BRONSON:  Second.

         14              GOVERNOR BUSH:  Moved and seconded.  Without

         15         objection, the motion passes.

         16              MR. WATKINS:  Item No. 3, a resolution authorizing

         17         the issuance and competitive sale of up to $240 million

         18         in PECO refunding bonds.

         19              COMMISSIONER BRONSON:  Motion on 3.

         20              COMMISSIONER GALLAGHER:  Second.

         21              GOVERNOR BUSH:  Moved and seconded.  Without

         22         objection, the item passes.

         23              MR. WATKINS:  And Item No. 4 is a report of award

         24         on the competitive sale of 138 and a half million

         25         dollars of Florida Forever Revenue Bonds.  The bonds
                              ACCURATE STENOTYPE REPORTERS, INC.

                      DIVISION OF BOND FINANCE, May 28, 2003                6
          1         were awarded to the low bidder at a true interest cost

          2         of approximately 3.83 percent.

          3              COMMISSIONER GALLAGHER:  Motion on 4.

          4              COMMISSIONER BRONSON:  Seconded.

          5              GOVERNOR BUSH:  Moved and seconded.  Without

          6         objection, the item passes.  Ben, any -- do you want to

          7         give us a quick update on the budget.  There was

          8         actually some good news on -- not the whole budget,

          9         just the --

         10              (Laughter.)

         11              MR. WATKINS:  I was going to say, you must have

         12         some time today, Governor.

         13              GOVERNOR BUSH:  Exactly.  They don't need to

         14         relive that.  But the bonding elements, I thought,

         15         turned out, given the tough year, normally -- other

         16         states are actually using debt to pay for general

         17         obligation day-to-day expenses.  California has

         18         proposed -- the California governor has proposed that

         19         which is -- when you reach that point, you know it's

         20         time to maybe move back to the private sector.  But we

         21         actually have had -- we had some good news on the

         22         Everglades at least and maybe you could brief the

         23         cabinet on that.

         24              MR. WATKINS:  Sure.  I would be happy to,

         25         Governor.  First off, relative to your first point,
                              ACCURATE STENOTYPE REPORTERS, INC.

                      DIVISION OF BOND FINANCE, May 28, 2003                7
          1         you're absolutely right, in comparison to other states

          2         and their financial position and how they are using

          3         debt to provide one-shot revenues to balance the

          4         budget, in effect, they're financing their deficit.  We

          5         are not even anywhere close to considering that.  I

          6         mean, we're dealing with plain vanilla, what we have

          7         always borrowed for in the past which is long-term

          8         fixed capital outlay projects.

          9              Class size reduction, my understanding, there is

         10         about 600 million in the budget for class size

         11         reduction which is an expansion of the Lottery Revenue

         12         Bond Program.  So we used a successful model, expanded

         13         it, provided additional funding for $600 million on

         14         that initiative.

         15              On the environmental bonding programs, we

         16         successfully completed the substitution of the surety

         17         bond for the cash reserve which freed up $300 million

         18         and the question was how was the Legislature going to

         19         use those monies.  Last year they had used them for

         20         purposes that were not consistent.

         21              GOVERNOR BUSH:  They tried to.

         22              MR. WATKINS:  They tried to.  And thanks to your

         23         sharp veto pen, that did not move forward.  This year

         24         they've seen the wisdom of your policy behind how to

         25         use this money and are using $200 million of the cash
                              ACCURATE STENOTYPE REPORTERS, INC.

                      DIVISION OF BOND FINANCE, May 28, 2003                8
          1         from the reserve being transferred to the Everglades

          2         Restoration Trust Fund and being used to pay for

          3         Everglades restoration.

          4              So we used monies in the reserve for the

          5         environmental programs that were freed up by the surety

          6         bond and moved those to the Everglades Trust Fund to

          7         pay for those in lieu of a new borrowing program which

          8         has been authorized but which will not be utilized

          9         until these monies are exhausted.

         10              GOVERNOR BUSH:  But wasn't the 100 million that

         11         remained transferred to Florida Forever and so we'll be

         12         issuing $200 million of debt instead of $300 million?

         13              MR. WATKINS:  Governor, that was one of the

         14         proposals, but I haven't had an opportunity to look at

         15         the budget and verify that.  But I believe that's

         16         correct.

         17              GOVERNOR BUSH:  So for the first time, since I've

         18         been around here at least, we're using cash instead of

         19         debt for these important preservation projects.  And

         20         just to put that in perspective, during what -- I got a

         21         chance to visit with my fellow governors quite a bit

         22         because of our Medicaid reform efforts we're trying to

         23         do, and that's just unprecedented.  No one is going --

         24         I mean everybody is going the other way.

         25              So I really commend the Legislature for -- they
                              ACCURATE STENOTYPE REPORTERS, INC.

                      DIVISION OF BOND FINANCE, May 28, 2003                9
          1         were on a path to do the ugly thing and they reversed

          2         themselves to do the right thing and taxpayers are

          3         going to be better off because of it.  You won't be

          4         reading about it in the paper which is why I asked Ben

          5         to give us a briefing.  This is good news and

          6         therefore, as I said, you won't read about it.

          7              MR. WATKINS:  It's good news, Governor, that's the

          8         reason we don't read about it.

          9              GOVERNOR BUSH:  That's what I just said.

         10              MR. WATKINS:  Thank you very much.

         11              GOVERNOR BUSH:  Thank you.














                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            10
          1              GOVERNOR BUSH:  Highway Safety and Motor Vehicle.

          2         That was an editorial comment by the way.

          3              COMMISSIONER GALLAGHER:  Motion on the minutes.

          4              COMMISSIONER BRONSON:  Second.

          5              GOVERNOR BUSH:  There's a motion on the minutes

          6         and a second.  Without objection, the item passes.

          7              MR. DICKINSON:  Governor, our second item is to

          8         request approval to contract for pre-employment

          9         psychological screenings for our CSOs, community

         10         service officers, and our troopers.  This is a contract

         11         we've had for 13 years for the group.  Even though it's

         12         exempted from some of the proceedings, we went ahead

         13         and got some quotes and this is the low group -- the

         14         low bid.

         15              GOVERNOR BUSH:  Is there a motion?

         16              COMMISSIONER GALLAGHER:  Motion.

         17              COMMISSIONER BRONSON:  Second.

         18              GOVERNOR BUSH:  A second.  Any discussion?  Moved

         19         and seconded.  Without objection, the item passes.

         20              MR. DICKINSON:  Governor, the next item in the

         21         ongoing saga of our plates, we have 17 plates before

         22         you.  And we're going to do them in a group if that's

         23         acceptable.

         24              GOVERNOR BUSH:  No, no, I think we should go

         25         through each one individually.
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            11
          1              (Laughter.)

          2              COMMISSIONER GALLAGHER:  And start with the very

          3         first one, the orange blossom.

          4              MR. DICKINSON:  Actually, all these plates are

          5         collegiate plates from the independent colleges and

          6         universities except for the first one which is the PBA

          7         plate.  I see some PBA guys here on the front row that

          8         have been very patient with us.  We have worked for a

          9         long time.  There you go.  (Laughter.)  Instead of

         10         sample, we went with -- go ahead, David.

         11              (Displaying plate.)

         12              MR. DICKINSON:  The PBA plate was passed some time

         13         ago and we've been working very diligently with them to

         14         get the artwork right.  It's a little more involved

         15         plate than some of the others.  All the rest -- and

         16         this goes to their heart fund as I understand it.  All

         17         the other tags go to a scholarship fund or some

         18         scholarship type endeavor.

         19              COMMISSIONER GALLAGHER:  Does everybody get "Bush"

         20         on their license plate, or is that just special?

         21              (Laughter.)

         22              MR. DICKINSON:  We're going to restrict that to

         23         one car, Governor.

         24              COMMISSIONER GALLAGHER:  I thought maybe the

         25         "Bush" part and they just change the number afterwards.
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            12
          1              GOVERNOR BUSH:  Exactly.  It's going to be a

          2         bestseller, no question.

          3              MR. DICKINSON:  We should have these plates out in

          4         60 to 90 days.

          5              GOVERNOR BUSH:  Now we have -- there was one of

          6         these -- I was a little embarrassed to tell you that I

          7         didn't know the Florida Hospital College of Health

          8         Sciences existed.  What is it?

          9              MR. DICKINSON:  Orlando.  That is a -- and I'm

         10         sure the lieutenant governor would know more about it.

         11              GOVERNOR BUSH:  Technical school?

         12              MR. DICKINSON:  Yes, sir.  Well, it's specifically

         13         for hospital administration.

         14              GOVERNOR BUSH:  Does anybody know?  Well, we got a

         15         plate for it.  God bless America.

         16              (Laughter.)

         17              COMMISSIONER GALLAGHER:  If they don't sell 8,000

         18         of them they'll be out of the plate business.

         19              GOVERNOR BUSH:  Fred, is that true now, that if

         20         you don't reach a certain threshold, your plate dies a

         21         graceful death?

         22              MR. DICKINSON:  Yes, sir, we have --

         23              (Off-the-record discussion.)

         24              MR. DICKINSON:  8,000 sales in five years.

         25              GOVERNOR BUSH:  Oh, in five years.
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            13
          1              MR. DICKINSON:  But these are exempted now.  These

          2         come under the college -- the collegiate exemption.

          3         And that, quite frankly -- if I can give you a little

          4         history here.  This is the George Kirkpatrick --

          5         affectionately known in our shop as the George

          6         Kirkpatrick tag.  George came to us about two weeks

          7         before the expiration of an extension that was put in

          8         the statute last session and he got 23 -- 23

          9         independent colleges and universities slid under the --

         10         it was actually, I think, put in for New College

         11         originally for a former president, Senator John McKay.

         12         Then they slid the rest of them in under this.

         13              So they still -- you know, we're going to have the

         14         tags out there, but we are mindful that there are very

         15         few of these tags that will sell compared to the

         16         mainstream.  So we're printing fewer of them, trying to

         17         save a little money.

         18              GOVERNOR BUSH:  Are we number one yet?

         19              MR. DICKINSON:  No, sir, we're still not number

         20         one but we're in the top five.  We're closing rapidly.

         21         This will make us 71 plates.  And you have before you a

         22         couple -- I think eight passed this last session.  And

         23         it has been, that's a nice sharp veto pen you have.

         24         But whatever we need to do, we will do.  And then there

         25         are an additional six, I think, in the pipeline to come
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            14
          1         before you that you've already approved.

          2              GOVERNOR BUSH:  And that still doesn't put us

          3         number one?

          4              MR. DICKINSON:  No, sir.  And I'm going to get you

          5         a ranking next time we come up here.  But I think we're

          6         fourth.

          7              COMMISSIONER GALLAGHER:  We're going to 77

          8         specialty plates -- all plates goes to 100?

          9              MR. DICKINSON:  This will be 77?  Seventy-one.

         10         Seventy-one.  We'll come forward with enough to boost

         11         it to 88.  But I think you're referring to some of the

         12         nonspecialty plates that our tax collectors hold in

         13         inventory such as the Purple Heart and some of those

         14         types.  And those do add up.  There's another 23 of

         15         those that the tax collectors hold in inventory.  But

         16         they are not -- they don't collect any money that goes

         17         to a designated source.

         18              COMMISSIONER GALLAGHER:  But it's still a

         19         different license plate that hangs on people's cars.

         20              MR. DICKINSON:  That's correct.

         21              COMMISSIONER GALLAGHER:  So we have, what I see

         22         here, is that if you take the total number of all of

         23         them, we're at 100.  Counting anything somebody can

         24         hang on their car legally.  Got to be number one, Fred,

         25         come on.
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            15
          1              (Laughter.)

          2              COMMISSIONER GALLAGHER:  Somebody has got more

          3         than 100 tags that hang on people's cars?

          4              MR. DICKINSON:  They do but I think the Governor

          5         wants me to tell you that we're number one.

          6              (Laughter.)

          7              GOVERNOR BUSH:  We're going to keep shopping until

          8         we are number one.  It's in your interest.

          9              MR. DICKINSON:  I don't think we have a problem

         10         there.

         11              COMMISSIONER GALLAGHER:  You will be the governor

         12         who moved us to number one in tags, no doubt about it.

         13              COMMISSIONER BRONSON:  Governor, also since we're

         14         on the tag issue and since Commissioner Gallagher has

         15         shown something that I asked some of our staff to work

         16         on in marketing, we had a lot of calls after the last

         17         meeting about the --

         18              GOVERNOR BUSH:  I heard.  I got a few too.

         19              COMMISSIONER BRONSON:  About the tag.  And I asked

         20         him to come up with an orange that looks more like an

         21         orange and we put the state flower on it.

         22              COMMISSIONER GALLAGHER:  And you won the contest,

         23         I guess.  The winner of the contest, Commissioner

         24         Bronson.

         25              COMMISSIONER BRONSON:  This is the suggestion we
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            16
          1         have based on a lot of phone calls.

          2              COMMISSIONER GALLAGHER:  So any third grader that

          3         designs it and it looks just like this will win the

          4         contest.  There won't be a fix or anything.  They'll

          5         all know what it's supposed to look like.

          6              COMMISSIONER BRONSON:  The only difference of what

          7         this one, that we would suggest, would be that we might

          8         actually have the "Florida" a little bit bigger but

          9         keep the "" with "Florida" being a little

         10         bit more prominent.  And the commissioner asked me

         11         about the blooms on the orange trees.  Late oranges in

         12         Florida, as most tourists over the decades, centuries

         13         have known, have blooms still on the trees while the

         14         oranges --

         15              GOVERNOR BUSH:  Of course they do.

         16              COMMISSIONER GALLAGHER:  So this is not a Valencia

         17         orange?  What kind of orange is this?

         18              COMMISSIONER BRONSON:  That would be more or less

         19         a Valencia that is a late season Valencia.  It has a

         20         bloom on it.

         21              GOVERNOR BUSH:  I heard the treasurer added the

         22         flowers, right?

         23              COMMISSIONER BRONSON:  That's a suggestion that we

         24         have.

         25              GOVERNOR BUSH:  Wasn't that your suggestion, the
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            17
          1         flowers?

          2              COMMISSIONER GALLAGHER:  That's the orange

          3         blossom, the state flower.

          4              GOVERNOR BUSH:  I like it.

          5              COMMISSIONER GALLAGHER:  And behind it is a

          6         Valencia, right?

          7              COMMISSIONER BRONSON:  Anyway, the other

          8         question would be to you, How many of the tags already

          9         printed do we have and how long a period of time are we

         10         talking before we see any new tag as far as the state

         11         tag goes?

         12              MR. DICKINSON:  Commissioner, if we got to work

         13         today, we're probably six to seven months out.  We've

         14         got that much inventory.  And we need to work with the

         15         vendor to come back to you with a prototype.

         16              COMMISSIONER BRONSON:  It's not a rush thing,

         17         we've got plenty of tags for a few months?

         18              MR. DICKINSON:  Yes.

         19              COMMISSIONER GALLAGHER:  And so we're going to get

         20         rid of the peach, I mean the orange that looks like a

         21         peach?

         22              GOVERNOR BUSH:  He'll send his crack team back to

         23         the drawing board to make sure it looks like an orange,

         24         not a peach.

         25              COMMISSIONER GALLAGHER:  You know, we were just
                              ACCURATE STENOTYPE REPORTERS, INC.

                  HIGHWAY SAFETY & MOTOR VEHICLES, May 28, 2003            18
          1         following your idea about having this contest.

          2              MR. DICKINSON:  Did you do the tags?

          3              GOVERNOR BUSH:  I don't think we did.

          4              COMMISSIONER GALLAGHER:  A motion on 2 (sic).

          5              COMMISSIONER BRONSON:  Second.

          6              GOVERNOR BUSH:  There's a motion and a second.

          7         Without objection, the item passes.

          8              MR. DICKINSON:  Thank you, Governor and cabinet.

          9              GOVERNOR BUSH:  You want a picture?

         10              MR. DICKINSON:  While they are coming up,

         11         incidentally we had 32 fatalities over the past weekend

         12         which is up a little from last year.

         13              GOVERNOR BUSH:  How many last year?

         14              COMMISSIONER GALLAGHER:  Thirty-two.

         15              GOVERNOR BUSH:  How much up from last year?

         16              MR. DICKINSON:  Two.

         17              COMMISSIONER GALLAGHER:  By the way, that was a

         18         motion on 3 for tags.

         19              (Pause.)






                              ACCURATE STENOTYPE REPORTERS, INC.

                       DEPARTMENT OF REVENUE, May 28, 2003                 19
          1              COMMISSIONER BRONSON:  Motion on the minutes.

          2              ATTORNEY GENERAL CRIST:  Second.

          3              GOVERNOR BUSH:  There is a motion on the minutes

          4         and a second.  Without objection, the item passes.

          5              MS. ECHEVERRI:  Good morning.  I'm Lisa Echeverri,

          6         deputy director for the Department.  Dr. Zengali wanted

          7         me to apologize for not being here this morning.  He's

          8         giving a presentation at the Stirling conference in

          9         Orlando.  And then he's hoping to go down to West Palm

         10         Beach to welcome the arrival of his first grandbaby.

         11              GOVERNOR BUSH:  All right.

         12              MS. ECHEVERRI:  So he's excited about that.

         13              GOVERNOR BUSH:  He should be.

         14              MS. ECHEVERRI:  Item 2, the Department is

         15         requesting approval of Rule 12E-1.022 which is the

         16         Overpayment Recovery Rule for child support

         17         enforcement.  This rule adopts federal provisions that

         18         will allow the Department to send three notices to a

         19         custodial parent that's received an overpayment and

         20         work out a payment schedule with that parent.  In the

         21         absence of an agreement, it would allow the Department

         22         to retain 25 percent of future distributions.

         23              GOVERNOR BUSH:  Is there a motion?

         24              COMMISSIONER GALLAGHER:  Motion on 2.

         25              COMMISSIONER BRONSON:  Second.
                              ACCURATE STENOTYPE REPORTERS, INC.

                       DEPARTMENT OF REVENUE, May 28, 2003                 20
          1              GOVERNOR BUSH:  Moved and seconded.  Any

          2         discussion?  Without objection, the item passes.  Thank

          3         you, Lisa.

          4              MS. ECHEVERRI:  Thank you.





















                              ACCURATE STENOTYPE REPORTERS, INC.

               FLORIDA LAND & WATER ADJUDICATORY COMM, May 28, 2003        21
          1              GOVERNOR BUSH:  The Florida Land and Water

          2         Adjudicatory Commission.

          3              COMMISSIONER GALLAGHER:  Motion on the minutes.

          4              COMMISSIONER BRONSON:  Second.

          5              GOVERNOR BUSH:  Moved and seconded.  Without

          6         objection, the item passes.  Item 2.

          7              MS. TINKER:  Item 2, recommend approval of the

          8         proposed final rule establishing the Tuscany Community

          9         Development District in Citrus County.  Governor, we

         10         have one speaker this morning, Bob Knight, representing

         11         Citrus County.

         12              MR. KNIGHT:  Thank you, Governor, members of the

         13         cabinet.  I'm representing Citrus County.  I would like

         14         it on the record that Citrus County is in favor of this

         15         development.  They are a developer with more than 40

         16         years' standing in Citrus County.  We believe it would

         17         be a positive addition to a development in the county.

         18         We did have one issue.  Would like to draw your

         19         attention that we believe Judge Alexander who held the

         20         public hearings on April 11th of last year resolved,

         21         Item 41 of his findings of fact and law basically

         22         state, The Commission is not the forum to consider or

         23         modifying the existing service territory of Rolling

         24         Oaks which is the utility that serves the rest of

         25         Beverly Hills.
                              ACCURATE STENOTYPE REPORTERS, INC.

               FLORIDA LAND & WATER ADJUDICATORY COMM, May 28, 2003        22
          1              It's not the forum to modify the existing service

          2         territory, Rolling Oaks, therefore that issue is not

          3         germane to this proceeding.  Providing of this forum

          4         does not portend to change service territory

          5         boundaries.  Citrus County is fully in favor of this

          6         development as envisioned.  Thank you.

          7              GOVERNOR BUSH:  Thank you.  Who was the developer?

          8              MR. KNIGHT:  Beverly Hills Development

          9         Corporation.

         10              GOVERNOR BUSH:  And they're based in Citrus

         11         County?

         12              MR. KNIGHT:  Yes, they are.  Members and officers

         13         of that organization are active locally in various

         14         civic organizations and are leaders in the county.

         15              GOVERNOR BUSH:  Okay.  Any discussion?

         16              COMMISSIONER GALLAGHER:  Motion on 2.

         17              COMMISSIONER BRONSON:  Second.

         18              GOVERNOR BUSH:  No other speakers?

         19              MS. TINKER:  No, sir.

         20              GOVERNOR BUSH:  Okay.  There's a motion and a

         21         second on Item 2.  Without objection, the item passes.

         22              MS. TINKER:  Thank you.

         23              GOVERNOR BUSH:  Thank you.

         24              Board of Trustees.  Bob, are you going to do it?

         25              (Off-the-record discussion.)
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          1              MR. LOVERN:  Good morning.  I'm Rob Lovern,

          2         Assistant Director of State Lands.  Item No. 1 this

          3         morning is approval of amendments to Chapter 18-23,

          4         Florida Administrative Code.  They cover an update of

          5         the description of buffer preserves, advise the public

          6         on how to obtain information about boundaries, specify

          7         the management goals of CAMA.  Specify the operating

          8         hours, deal with rules and regulations on it.  And most

          9         specifically, Item 6 is, Establish and specify fines

         10         and violations pursuant to the legislative, the

         11         recommended approval.

         12              We have two speakers this morning and the first

         13         speaker is Gerald Ward.

         14              GOVERNOR BUSH:  Good morning, sir.

         15              MR. WARD:  Good morning.  I'm Gary Ward, Gerald M.

         16         Ward.  31 West 20th Street, Riviera Beach.  Member and

         17         represent the legislative committee of the Marine

         18         Industries Association of Treasure Coast headquartered

         19         in Stuart and operating for Indian River, St. Lucie,

         20         Okeechobee and Martin Counties.  As an aside, but truly

         21         on point, General Crist, welcome back from your CNN

         22         Live appearance in Atlanta after 8:00 p.m. last night.

         23         You were very effective in comments on the driver's

         24         license photos.  A very similar issue to this item,

         25         legal, due process, and fairness.  Even my very liberal
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          1         wife back in Riviera Beach agrees and supports the

          2         State's position on the driver's license photos.

          3              This issue is another holiday rulemaking by the

          4         Florida Department of Environmental Protection, Office

          5         of Coastal and Aquatic Managed Areas.  The Trustees'

          6         tenant and lands manager for certain sanctuaries and

          7         reserves in and adjacent sovereignly submerged lands

          8         which by this rulemaking will now include hundreds of

          9         islands, uplands, within the boundaries of the three to

         10         four dozen aquatic preserves within the state.

         11              The rulemaking sort of reminds me of a camel

         12         construction which was authorized solely by a floor

         13         amendment in the last three days of the 2001

         14         Legislature attached to the Florida Forever Act, sort

         15         of a train.  Beginning with an attempt at rulemaking in

         16         March and April of 2002, the first attempt was

         17         withdrawn in late summer and we saw, again, that

         18         Thanksgiving this rulemaking rule development start

         19         with a proposed rule between Christmas and New Year's,

         20         which you have before you today.  We think it is

         21         somewhat --

         22              GOVERNOR BUSH:  I'm sorry, you said the hearing

         23         was between Christmas and New Year's?

         24              MR. WARD:  No, the proposed rule was published

         25         between Christmas and New Year's, 27 December.  That's
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                         BOARD OF TRUSTEES, May 28, 2003                   25
          1         what you have before you is the proposed rule.

          2              And we did have one hearing.  There was workshops

          3         from the rule development but they happened to be the

          4         same week that Roger Babb, the hearing officer for the

          5         U.S. Fish and Wildlife Service, told me he had right at

          6         3,000 people show up in Fort Myers on the manatee issue

          7         but these hearings or workshops were held the first

          8         week of December of 2002, Monday through Friday and the

          9         cabinet, your aides, heard how attendance was very

         10         poor.

         11              Well, the voting community was out in force for

         12         other issues which conflicted.  I would tell you that

         13         there was then a public hearing, the Marine Industries

         14         Treasure Coast had submitted written comments for which

         15         we have yet to have a response to either of our two

         16         letters which does disturb us, but that doesn't

         17         invalidate the process as your chief aide, Governor,

         18         was talking about.  The 120 process has probably been

         19         followed to the technical provisions of Chapter 120.

         20         We're concerned about whether the ultimate ticket fine

         21         process is effective in enforcement or whether it

         22         should be modified further.

         23              And our ultimate close in a minute would be that

         24         you probably ought to defer it and let your staffs,

         25         particularly your lawyers, take a look at it.  We have
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          1         given you a two-page letter from the Marine Industries

          2         dated the 23rd of May which summarizes the issues

          3         location.  They're deleting the definitions written of

          4         notice of where preserves are going to be located.

          5         That's in the current rule that's being modified.

          6              We're concerned that there are no basic standards

          7         for the gradation of fines from 50 to $500 as a ticket

          8         fine.  They can be cumulative.  Your kid at 18 goes to

          9         an island within an aquatic preserve, stays overnight,

         10         that's camping, he gets cold, lights a fire, that's an

         11         unpermitted fire.  Like all kids, he may have a beer on

         12         board the boat or something.  They just add up and you

         13         can get $1,000 worth of ticket fines real quick.

         14              We call your attention to 327.73, Florida

         15         Statutes, which is our basic boating ticket

         16         enforcement, noncriminal violation.  And that has been

         17         fine-tuned for years.  It's a $50 fine and it tends to

         18         work.  It produces effectiveness in that if somebody

         19         violates, they do find out that there are laws of the

         20         state of Florida and they have a process and procedure

         21         if they wish to challenge it.  This particular

         22         rulemaking omits all of the safeguards and reduces

         23         probably the effectiveness because it will probably

         24         generate business for lawyers who find that the

         25         violator has been ticketed for $1,000 worth of fines
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          1         and we think that's probably not good overall law

          2         enforcement in the state.

          3              Our suggestion was to let your -- each of you have

          4         on-staff lawyers.  Let them take a much closer look at

          5         it and defer for a cycle so that you can get a better

          6         read on whether this is what you really want to do.  If

          7         you don't, I think it will be back to you with

          8         legislative changes which is maybe another way to

          9         handle the problem.

         10              GOVERNOR BUSH:  You know, the irony is since you

         11         all worked so hard to get a bill passed that I may --

         12         I'm not going to say if I'm going to sign it yet

         13         because I haven't signed it.  But there will be better

         14         enforcement.  Taking the marine fuel tax away from the

         15         road budget to increase enforcement.  Do you find any

         16         irony there?

         17              MR. WARD:  No, sir, because --

         18              GOVERNOR BUSH:  I do.  I find it ironic.

         19              THE WITNESS:  That particular marine fuel tax is

         20         generated by the marinas.  That doesn't even include

         21         those in the gas stations --

         22              GOVERNOR BUSH:  But the money is going to increase

         23         enforcement for violation of laws.  And your principal

         24         concern here is these possible fines are onerous, it

         25         sounds like.
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          1              MR. WARD:  Well, these fines are not effective.

          2         When you take a very heavy fine, it's not effective.  A

          3         small fine against folks makes them understand the

          4         process, makes them say, I shouldn't do this again.

          5         The big fine causes them to bring out the big guns, the

          6         lawyers, to fight it, go to court, and that's not

          7         effective for our judicial system.

          8              GOVERNOR BUSH:  But we're going to have a lot more

          9         smaller fines because if I pass this bill -- I mean, I

         10         think we need more law enforcement on the waters.  It's

         11         definitely an issue in our state.

         12              MR. WARD:  That's what 327.73 provides for.

         13         That's the nonjudicial ticketing fine.

         14              GOVERNOR BUSH:  Thank you, sir.  Any other

         15         speakers?

         16              MR. LOVERN:  I'd like to introduce Danny Riley

         17         with the Office of Coastal and Aquatic Managed Areas.

         18              GOVERNOR BUSH:  Good morning, sir.

         19              MR. RILEY:  Good morning.  Thank you.  I'm Danny

         20         Riley, assistant director of the Office of Coastal and

         21         Aquatic Managed Areas which is a relatively new

         22         division of the Department of Environmental Protection.

         23         As a result of the very aggressive land acquisition

         24         programs of the state, we have rapidly become one of

         25         the major land managers in the state and particularly
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                         BOARD OF TRUSTEES, May 28, 2003                   29
          1         coastal properties.

          2              We're currently managing 160,000 acres of coastal

          3         uplands.  And we've had -- we experience all of the

          4         difficulties for managing these properties including

          5         enforcement issues.  Because of that, we sought

          6         specific legislative authority in Chapter 253.86 in the

          7         2001 Legislature which gave the Office of Coastal and

          8         Aquatic Managed Areas specific rulemaking authority and

          9         it authorized the use of fines for violations on our

         10         properties up to $500.  As a result of that, we have

         11         started the promulgation of these rules to manage these

         12         properties.

         13              We started off without a draft rule in late

         14         summer.  We scheduled five workshops to obtain public

         15         input to see -- to inform the public of what our needs

         16         were for managing the property and to get their input

         17         so that we could objectively establish fair and

         18         reasonable rules so that we could manage the property

         19         in accordance with the way the trustees would like for

         20         us to and also be sensitive to the public concerns

         21         about public use.

         22              I held those five workshops around the state.  The

         23         first one was in St. Petersburg in early December.

         24         There were no attendees.  The second one --

         25              GOVERNOR BUSH:  None?  Zero?
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          1              MR. RILEY:  None.  The second was in Fort Myers.

          2         There were no attendees.  The third one was in West

          3         Palm Beach.  There was one attendee, that was

          4         Mr. Gerald Ward.  The fourth one was in Melbourne.

          5         There were 16 attendees at that meeting.

          6              GOVERNOR BUSH:  General?

          7              ATTORNEY GENERAL CRIST:  What time do you hold

          8         these things?

          9              MR. RILEY:  They were held at --

         10              ATTORNEY GENERAL CRIST:  Meetings, forgive me.

         11              MR. RILEY:  6:30 -- 6 or 7 p.m.  I don't remember.

         12         But they were after work hours.  And they were

         13         advertised as required by law in the Florida

         14         Administrative Weekly.  Plus they were advertised --

         15              ATTORNEY GENERAL CRIST:  Everybody reads that.

         16              (Laughter.)  I gest.

         17              MR. RILEY:  And they are advertised in the local

         18         newspapers and there are listings of that in the backup

         19         to this item as to where they were advertised and when.

         20         So there was ample opportunity for the public to be

         21         aware and attend these meetings.

         22              The meeting and -- the workshop in Melbourne,

         23         there were actually 16 people who attended, half of

         24         whom said that they were there because they thought

         25         this was the manatee issue and left when they found
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          1         that it was not.  And then the fifth workshop was in

          2         Jacksonville and there was no one who attended there.

          3         After those workshops, we developed the draft rules and

          4         then had a public hearing again in Melbourne because

          5         that's where -- that was the central location where

          6         most of the interest had been expressed previously.

          7         And we had a dozen or so people at that meeting.  And

          8         basically there's been agreement among all the parties

          9         that we've involved other than Mr. Ward throughout this

         10         process.

         11              In fact, I have a letter here from Standing Watch

         12         that I met with on several occasions, the same as I did

         13         with Mr. Ward, that compliments us for involving them

         14         appropriately and for the result that we came up with

         15         in the rules.

         16              GOVERNOR BUSH:  But what about the question of an

         17         open-ended pricing for the fines rather than some kind

         18         of gradation that could be established?

         19              MR. RILEY:  Well, it simply is not true.  What we

         20         got in the legislative authority is fines up to $500.

         21         What we have done in these rules is establish four

         22         different categories which are different levels of

         23         fines.  The first one being a $50 fine for a

         24         nondestructive violation that includes consumption of

         25         alcoholic beverages or the solicitation or distribution
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          1         of commercial materials in advertising.

          2              The second category is a $100 fine and that's

          3         major nondestructive violations and that is for the

          4         proper disposal of wastewater and trash.  The third

          5         category is $250 fines for resource damage violations

          6         including trapping and concealment devices being used

          7         for trapping animals, hunting or harassing wildlife,

          8         admission of unleashed domestic animals,

          9         transplantation, removal of exotic plants and so forth.

         10              And the fifth category is $500 fines for public

         11         danger violations.  There are only two of those.  One

         12         is for the use of firearms which might endanger the

         13         public.  And fires are limited to designated areas.

         14         And that is a result of the need to control fires

         15         because of obvious problems we've had on state lands

         16         during the drought periods over the last few years.  So

         17         we do, in fact, have a gradation of the fines.

         18              And following the public workshop in Melbourne and

         19         private meeting with Mr. Ward, based on their

         20         recommendations to reduce the amounts of fines, we did,

         21         in fact, reduce the fines.  We started off in the

         22         original draft with fines of 100, 250, and 500.  So we

         23         did actually reduce the fines so that there are some

         24         lower level fines now.

         25              GOVERNOR BUSH:  Any other questions?  So the
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          1         proposed rule -- when you say it's a proposed rule,

          2         we're approving -- we're not approving the final rule

          3         here, are we?

          4              MR. RILEY:  Yes, this is for rule adoption.

          5              GOVERNOR BUSH:  Any other discussion?

          6              COMMISSIONER GALLAGHER:  There's a motion.

          7              GOVERNOR BUSH:  Oh, there's a motion.  I'm sorry.

          8              COMMISSIONER GALLAGHER:  I made a motion.

          9              GOVERNOR BUSH:  There is a motion.  Is there a

         10         second?

         11              Yes, General.

         12              ATTORNEY GENERAL CRIST:  Thanks.  Maybe I misheard

         13         but I thought you recommended a deferral in your

         14         opening comments.  Not you.

         15              MR. RILEY:  Mr. Ward recommended deferral.  We are

         16         recommending approval.

         17              ATTORNEY GENERAL CRIST:  Indeed.

         18              MR. RILEY:  We, the Agency.

         19              ATTORNEY GENERAL CRIST:  Second.

         20              GOVERNOR BUSH:  There is a motion and a second.

         21         Any other discussion?  Without objection, the item

         22         passes.

         23              MR. LOVERN:  Item No. 2 is consideration of a

         24         request to enter into rulemaking to make amendments to

         25         Chapter 18-21 regarding the forms of authorization
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          1         required for the use of sovereignly submerged lands.

          2         The intention in rulemaking is to get into some of the

          3         definitions in the rule existing.  Management

          4         practices, standards, and criteria, forms of

          5         authorization required for use of sovereignly submerged

          6         lands and submerged lands.  Applications for lease,

          7         application for public and private easements, payments

          8         and fees.  And we have several speakers on this item

          9         this morning, the first of which is Jeremy Kraft.

         10              COMMISSIONER GALLAGHER:  Right before he speaks.

         11              MR. LOVERN:  Yes, sir.

         12              COMMISSIONER GALLAGHER:  On this particular one,

         13         at this point, although I want to hear the speakers,

         14         I'm a little concerned about what happens to private

         15         dock owners and what this rule appears, although I'm

         16         sure some discussion can happen, appears to start

         17         taking those people that have a little dock and put a

         18         little pontoon boat or something, all of a sudden

         19         having to lease the submerged land, all this other

         20         stuff that hasn't been in the past, I want to make sure

         21         it's clarified in here that we're not doing that before

         22         we end up moving forward on this.

         23              MR. LOVERN:  Yes, sir, the -- I just want to --

         24         it's my understanding that no private dock that exists

         25         today that's not required to have a lease would be
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          1         required to have a lease after rulemaking.  But I'll

          2         let Jim Stoutamire with the Bureau of Submerged Lands

          3         explain in more detail to make sure we have that

          4         covered.

          5              GOVERNOR BUSH:  Good morning, sir.

          6              MR. STOUTAMIRE:  Good morning.  Jim Stoutamire.

          7         Submerged Lands and Environmental Resources.  Just to

          8         briefly respond to your concern, this rule will not

          9         elevate the form of authorization required for any

         10         single-family dock.  A dock that was large enough to

         11         require a lease today would require a lease tomorrow.

         12         A dock that did not require a lease today would not

         13         require a lease tomorrow.  We have merely tightened up

         14         and made the definition clear so that single-family

         15         homeowners, dock contractors and staff can clearly

         16         understand the distinction between the minimum size

         17         dock or the ten to one dock, the single-family

         18         homeowner qualifies for under their riparian rights and

         19         the larger docks.

         20              GOVERNOR BUSH:  Why are we doing this?

         21              MR. STOUTAMIRE:  Sir?

         22              GOVERNOR BUSH:  Is this based on a law that

         23         passed?

         24              MR. STOUTAMIRE:  The forms of authorization

         25         portion of the sovereign lands rules have not been
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          1         amended, it's my understanding and substantively in

          2         about 20 years.  The intent of this rulemaking is

          3         primarily to make the rule consistent with past board

          4         actions dating as far back as 1972.  Clarify the form

          5         of authorization for the public, clarify the form of

          6         authorization for staff.

          7              It does not elevate the form of authorization for

          8         any structures, public or private.  And, in fact,

          9         certain cases, for example, public channels, private

         10         sea walls, it lowers the required form of

         11         authorization.  For example, public channels will no

         12         longer require an easement.  They may be authorized

         13         under a letter of consent.

         14              COMMISSIONER BRONSON:  Governor?

         15              GOVERNOR BUSH:  Yes, Commissioner.

         16              COMMISSIONER BRONSON:  Thank you.  I have had a

         17         few concerns about Item 2.  One of the concerns about

         18         the proposed rule amendments, specifically I'm

         19         concerned about the serious -- potential serious

         20         financial implications this amended rule as currently

         21         proposed might have on the aquaculture industry.  And

         22         although I won't hold up the rulemaking going forward,

         23         I would request that DEP staff work with my aquaculture

         24         staff and the Department on language in this rule which

         25         will ensure that the aquaculture industry is not
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          1         negatively impacted.  And also based on the concerns

          2         that I think we're going to hear today that one hearing

          3         is not necessarily adequate in this issue.

          4              I'm not sure all of those that may be affected

          5         understand the potential of this rulemaking.  And I

          6         would actually ask that DEP, as a condition of the rule

          7         going forward for my vote, that I would ask the cabinet

          8         to consider DEP to hold two additional workshops and

          9         one public hearing and for the DEP staff to work with

         10         our aquaculture staff.  And the reason why, Governor,

         11         that I'm concerned, there are some, and I would assume

         12         that this is going to be a consideration under this

         13         rule, there are some of our clam operators who actually

         14         are leasing State submerged lands on clams that will

         15         leave their dock at their house to go out and work

         16         their clam leases and they may bring some clams back

         17         that they take to a processing plant to their dock

         18         which could leave them as considered to be a commercial

         19         operation rather than they're docked at their home that

         20         could set up some potential problems for those

         21         individual clam leases.  And some of these are only

         22         like an acre to three-acre leases.  They're very small

         23         leases.  And I don't want to negatively impact them

         24         with the potential of having to pay a high lease on a

         25         dock that they've had for years.  And now that they
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          1         have one little acre of submerged land, now they are

          2         going to get hit with a high fee.  So I would at least

          3         like to have two more additional workshops so that

          4         those people would understand that and at one more

          5         public hearing so that if they do have a concern on

          6         this, they will show up and work those issues out.

          7              GOVERNOR BUSH:  Are there any speakers?

          8              MR. STOUTAMIRE:  I believe there are.  And if I

          9         may respond briefly, we'll certainly welcome your

         10         direction on this issue.  I will note that this rule

         11         has already had four publicly noticed technical

         12         advisory committee meetings and four public workshops.

         13         With respect to the aquaculture issue, we'll be more

         14         than happy to work with your staff.

         15              I will call your attention to some language we

         16         have added to the definition of revenue-generating

         17         activities which clarifies that the act of mooring a

         18         commercial vessel, for example, a vessel serving an

         19         agriculture lease or any other commercial activity at

         20         one's residential dock, does not make that dock

         21         revenue-generating and hence it would not require a

         22         lease based on the revenue-generating lease

         23         requirement.  But we will be happy to work with

         24         aquaculture staff and tighten that language up.  I

         25         appreciate the suggestion.
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          1              COMMISSIONER BRONSON:  I wanted to make sure.

          2         Because I was under the understanding that if they go

          3         out in their boat, and many times it's their own

          4         fishing boat that they're going out in, and they bring

          5         clams in a bag back to the dock and just lay it up on

          6         the dock to carry it to a processing facility, that

          7         could be construed as an industrial or a business use

          8         of that, quote, private dock and that's what has me

          9         concerned.

         10              MR. STOUTAMIRE:  I understand.  And like I said,

         11         we'll be happy to work with your staff on that issue.

         12              GOVERNOR BUSH:  Speakers.

         13              MR. LOVERN:  Next speaker is Jeremy Kraft.

         14              GOVERNOR BUSH:  Welcome, sir.

         15              MR. KRAFT:  Good morning, Governor and members.

         16         I'm Jeremy Kraft with Advanced Environmental

         17         Technologies.  I'm here today representing Bob and Judy

         18         Langford who have been required to get a lease for a

         19         private dock.  It's 245 feet long.  They had to make it

         20         that long to get to three and a half feet of water.

         21         They've got two boat slips.  They are small slips,

         22         10 feet wide and 12 feet wide.

         23              They were required to get a lease because they

         24         wanted to put a cover over their boats to protect their

         25         investments.  That's the kind of activity that's going
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          1         on today.  Jim is correct.  This rule would just codify

          2         the actions of the Department as they exist today.  But

          3         the Department has changed its philosophy with respect

          4         to private docks.  We've gone back -- and I've

          5         circulated a report to each of your offices.  We've

          6         gone back and looked at 30 years worth of board action.

          7         We could not find an instance where the board directed

          8         the staff to require leases for private single-family

          9         docks.

         10              You also have a conceptual state land management

         11         plan that is in effect that does not include private

         12         docks under the leasing category.  This rule is not

         13         changing that conceptual land management plan and it

         14         should be, if we're going to make this change and start

         15         requiring leases on private docks.  This rule for the

         16         first time would include the words "private dock" and

         17         "lease" in the same sentence.  It has not existed

         18         before.  We also pulled a list of docks that may be

         19         private single-family docks from DEP last Wednesday.

         20         They do not have a separate computer category to

         21         separate out private single-family docks.

         22              We found a maximum of 114 of those that could be

         23         private docks.  They range in size from as small as

         24         836 square feet.  That's a tiny dock.  You also have to

         25         think that these rules were adopted in the 1980s; Jim
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          1         is correct there.  They need revision.  They need to

          2         incorporate today's culture, today's economy.  In the

          3         1980s few people needed more than two slips.  With the

          4         advent of jet skis, it's not uncommon to find a family

          5         that has a flats fishing boat and a couple of jet skis.

          6         Under that scenario, you'd have to obtain a lease

          7         because DEP would consider it three slips.

          8              We think it's inappropriate to move forward with a

          9         rule that requires leases on private docks in that

         10         instance.  There are other areas of the rule that cause

         11         concern.  We've also got clients who will be forced to

         12         come under lease because of changes in the definition

         13         of preempted area.

         14              GOVERNOR BUSH:  Preempt?  I'm sorry?

         15              MR. KRAFT:  Preempted area.  Right now the area

         16         you have to lease is what's considered preempted and

         17         it's a dock that goes out to mooring pilings.  I think

         18         the wording in this rule greatly strengthens the

         19         Department's arguments that a lot of areas would have

         20         to come under lease that presently do not have leases

         21         and which have had letters from the Department in the

         22         past saying they do not need leases.

         23              But we're fighting one of these battles right now

         24         in Pensacola where a facility that was built in 1917

         25         has a letter saying it didn't need grandfathering,
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          1         didn't need to come under lease, is now being required

          2         to come under lease.  This rule would make it clear

          3         that that facility would have to have a lease.  Those

          4         kind of public policy issues should be addressed a good

          5         deal further.

          6              Another area of concern is with the unit-to-slip

          7         ratio with condominiums.  In the 1980s when this rule

          8         was adopted, there was a good study done, directed by

          9         the Board of Trustees then to determine how many

         10         condominium owners of waterfront property actually had

         11         boats.  The concern was people were leasing these dock

         12         spaces to people and making money on them.

         13              The unit-to-slip ratio was put into place then in

         14         order to minimize the number of rental slips that might

         15         be behind condominiums.  Luckily our economy has grown

         16         greatly since the '80s.  People can afford boats.  And

         17         now I think if you go back and do that same study,

         18         you'll find most waterfront condominium owners want

         19         boats behind their condominium.  The unit-to-slip ratio

         20         no longer applies.

         21              Also, it was invented at the time when most boats

         22         were only about 24 feet long.  Now we're seeing boats

         23         in the 45-foot trawler range.  And the area limitations

         24         allowed for condominium docks no longer are effective,

         25         no longer allow one to even meet the unit-to-slip
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          1         ratio.

          2              So we would urge you to direct staff, if you want

          3         to move -- continue with the rulemaking, urge them to

          4         open the discussions fully on these issues and to bring

          5         them back to you after a full public discussion of

          6         these.  Thank you.

          7              GOVERNOR BUSH:  I appreciate your comments.  I

          8         still -- if the Department could answer the question

          9         why we're doing this and whether or not this -- there

         10         wasn't, unlike the previous discussion where there was

         11         a law that rules needed to be created to deal with the

         12         new statute, there is no statute that is driving this.

         13         That was your answer, right?

         14              MR. STOUTAMIRE:  That is correct.

         15              GOVERNOR BUSH:  Do you have the delegated

         16         authority to do these rules based on the new APA

         17         interpretations?

         18              MR. STOUTAMIRE:  This rulemaking is totally

         19         consistent with Chapter 120 and it's a direct outgrowth

         20         from direction from the Board of Trustees on a variety

         21         of occasions to clarify the forms of authorization.

         22         And, in fact, this rule has been before you before

         23         back, I believe, in 1999 to actually start the

         24         rulemaking.  What we are bringing here to you now is

         25         request for approval to publish the proposed rule to
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          1         begin the formal adoption process and get additional

          2         public comment.

          3              With respect to the structures that were

          4         mentioned, the private residential single-family dock,

          5         yes, there are two slips.  Yes, one of them is 10 feet

          6         wide.  Yes, the other is 12 feet wide.  They are

          7         27 feet long for a 21-foot flats boat and a 17-foot

          8         Boston Whaler.  The addition of a cover did not trigger

          9         the need for a lease.  The fact that this dock is

         10         wider, longer, has two additional platforms in addition

         11         to the slip and exceeds the size of those in the

         12         immediate vicinity triggered the need for a lease.

         13              With respect to the preempted area, as I mentioned

         14         earlier, this codifies board policy going back to items

         15         as far back as 1972, that commercial off-loading

         16         facilities adjacent to bulkheads to commercial uplands

         17         do, in fact, require a lease whether or not mooring

         18         pilings exist.  The board has voted on this, to my

         19         personal knowledge, on three separate occasions.

         20              GOVERNOR BUSH:  All right.  Any other speakers?

         21              MR. LOVERN:  Second speaker I have listed is Nancy

         22         Brown.  I'm not sure if she's here this morning.  I

         23         haven't seen her.  We can go ahead and go to the next

         24         one.  Third speaker -- I'm sorry.

         25              MR. STOUTAMIRE:  Ms. Brown had several concerns
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          1         about the rule but she was satisfied.  One of them was

          2         striking a statutory reference, her concern that

          3         somehow that was going to eliminate the statute.  And

          4         the other was some concern over unit-to-slip ratio.

          5              MR. LOVERN:  Third speaker is Gerald Ward.

          6              GOVERNOR BUSH:  Good morning, again.

          7              MR. WARD:  Good morning, again, yes, sir.  You get

          8         a double dip today fortunately.  Gerald Ward, 31 West

          9         20th Street, Riviera Beach.  I'm here as a consulting

         10         engineer, coastal and environmental, over 30 years of

         11         practice and a very long-term member of the Florida

         12         Engineering Society, Conservation on Environmental

         13         Quality Committee.  We support going ahead now.  With

         14         that statement, we would like to sort of elaborate for

         15         a short time.  The basic rule, 18-21, was developed in

         16         1982 to 1984.  I go back prior to Jim Stoutamire in

         17         processing things directly with the trustees which went

         18         out of office existence in 1975.

         19              We -- this is really an issue of definition of how

         20         to and to some degree money.  The single-family dock

         21         issue needs you-all's specific input and direction.

         22         Jim is correct that lots of things could require, for

         23         over 1,000 foot, a single-family homeowner to get a

         24         lease.  And it's been bad for the public to be beat

         25         about by a processor in Pensacola or West Palm Beach
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          1         over the last two decades that did apply or didn't

          2         apply the rule.

          3              The rule is convoluted in some cases and it needs

          4         clarification just like Commissioner Bronson's

          5         aquaculture issue.  You don't need the guy that goes

          6         out of his house and has a commercial fishing license

          7         to always have to have a lease or provide for some

          8         compensation to the trustees.  I would like you to

          9         consider Jeremy's comments about additional hearings,

         10         Commissioner Bronson's.  We really need hearings

         11         sometimes, not workshops, because you get better

         12         recording.  That's one of the problems we had with the

         13         previous item.

         14              If you don't have a full record of what happened,

         15         you don't know what happened.  And let's go to the next

         16         step.  Telecommunications.  There's nothing wrong with

         17         each of these being noticed as a telecommunications

         18         hearing.  Establish a meet-me number which doesn't cost

         19         the Department a whole lot of money but people sit in

         20         their office, they've got all their resources with them

         21         and they bring lots of good ideas, they don't have to

         22         travel.  Just do something new to get this to resolve

         23         because we do need the definition and you need to get

         24         more involved your own selves.  There are things that

         25         sometimes we sit out in the audience and look at and
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          1         say, Maybe we should have done more in education of the

          2         Board.  So let's go forward today.  Thank you.

          3              GOVERNOR BUSH:  Thank you, sir.

          4              MR. LOVERN:  Fourth speaker this morning is

          5         Mr. Richard Brightman.

          6              MR. BRIGHTMAN:  Good morning, Governor, members of

          7         the board.  I'm Richard Brightman from Hopping, Green

          8         and Sams here today on behalf of the Florida Electric

          9         Power Utility Incorporated coordinating group.  The FCG

         10         is a trade association of some 39 or more public

         11         utilities, investor-owned, municipal, and cooperative

         12         electric utilities.  We've been participating with the

         13         staff on this rule development from the inception,

         14         maybe even before the inception, and would echo some of

         15         the remarks earlier that this rule does need to be

         16         clarified.  It is confusing to the general public and

         17         to the practitioner and I think also to staff and

         18         does -- would warrant some clarification.  We're

         19         generally in support of the nondocking issues -- I'm

         20         not here to talk about docking issues -- that the staff

         21         has put into this rule.

         22              I would like to commend for your consideration a

         23         couple of additional changes that the electric utility

         24         industry would like to see put into this rule.  The

         25         first is to provide for some temporary consent for the
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          1         construction of already-approved electric transmission

          2         cables.  Currently, the process is when an electric

          3         transmission cable has to cross sovereign lands they go

          4         through the full-blown easement process and that can

          5         take several months to get approved, sometimes even

          6         coming before this Board depending on the delegations

          7         of authority.

          8              But the current process has, after it is

          9         ultimately approved, the cable cannot be constructed

         10         until the easement document itself is drafted, signed,

         11         and recorded.  Now that may sound like a simple process

         12         but it can take at least six to eight weeks.  And in my

         13         experience, I've had one that took over a year after

         14         the easement was approved before the easement document

         15         was signed -- drafted, signed, and recorded.  And that

         16         prevented the electric utility from fulfilling its

         17         statutory obligation to provide service with that cable

         18         during that period of time after the easement had been

         19         approved.

         20              GOVERNOR BUSH:  It takes six to eight weeks to --

         21         after approval to record --

         22              MR. BRIGHTMAN:  To draft, get signatures, and

         23         record.  That's on a good day, Governor.

         24              GOVERNOR BUSH:  That's ridiculous.

         25              MR. BRIGHTMAN:  As I said --
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          1              GOVERNOR BUSH:  Be prepared, Department, to

          2         answer the question why it takes so long.  But go

          3         ahead.

          4              MR. BRIGHTMAN:  What I'm suggesting solution as a

          5         solution for that is that there be a letter of consent

          6         authorized to allow the utility to go forward during

          7         that process.  We're happy to go through that process

          8         and get it drafted, signed, and get it recorded and so

          9         forth, but we ought not to be held up from constructing

         10         during that hiatus.

         11              The second issue I'd like to raise with you is the

         12         form of authorization required for the use of

         13         horizontal directional drill technology where they bore

         14         underwater bodies instead of putting a cable over an

         15         overhead crossing.  Currently, the rule provides either

         16         an exemption or the less formal approval, a letter of

         17         consent for overhead crossings if there are no

         18         structures on sovereign lands.

         19              However, horizontal directional drill activities,

         20         which I think most people agree are less impactive,

         21         still require the full-blown easement.  My clients

         22         would like to suggest that creates a disincentive for

         23         the industry to use the less impactive technology

         24         because they have to go through a more formal

         25         time-consuming process to get the approval.
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          1              So I'm here to generally support what's been done

          2         but to urge you to maybe gently nudge the staff to go a

          3         little further on those two issues I'd raised.  That's

          4         all I have.  I'd be happy to answer questions.

          5              GOVERNOR BUSH:  Thank you very much.

          6              COMMISSIONER GALLAGHER:  I move to continue ahead

          7         with this rule and bring it back after they've had a

          8         little more work on it to clarify the private dockage

          9         and to clarify some of the aquaculture problems that

         10         Commissioner Bronson has and hopefully clarify some of

         11         the leases that are done for the utility industry.  I

         12         think these things all need a little clarification.  I

         13         think if you-all spend some time on that you'll be able

         14         to do it.  And I'd personally like to see it again.

         15              GOVERNOR BUSH:  Oh, you will soon.

         16              COMMISSIONER GALLAGHER:  Well, we wouldn't if

         17         we --

         18              GOVERNOR BUSH:  Wouldn't we?  I mean, it would

         19         come -- it's a proposed rule so it would come back to

         20         us for approval --

         21              COMMISSIONER GALLAGHER:  No, we're approving it

         22         here.

         23              MR. STOUTAMIRE:  This is step one.  We will be

         24         holding, pending your direction, a minimum of one

         25         public hearing at which the public will be free to
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          1         comment and suggest amendments.

          2              GOVERNOR BUSH:  What do you think about that

          3         telecommunications idea?  It's a big state.

          4              MR. STOUTAMIRE:  That's something we routinely do.

          5         We did it as recently as a fiber optic hearing down in

          6         West Palm Beach where we had call-in lines for some

          7         folks from California.

          8              GOVERNOR BUSH:  So you're going to do it?

          9              MR. STOUTAMIRE:  Oh, yeah.

         10              COMMISSIONER BRONSON:  On my motion, are we going

         11         to add my motion to which says -- which calls for two

         12         additional workshops and one public hearing?

         13              COMMISSIONER GALLAGHER:  It's fine with me.

         14              COMMISSIONER BRONSON:  As well as the DEP staff

         15         working with our aquaculture staff to make sure there's

         16         not going to be any complications there.

         17              COMMISSIONER GALLAGHER:  If that's a motion, I'll

         18         second your motion.  How's that?

         19              GOVERNOR BUSH:  There's a motion and second.  Any

         20         other discussion?  The motion as amended is approved

         21         without objection.  Can someone answer the question of

         22         the time it takes to get, after approval --

         23              MR. LOVERN:  No one stepped up as quickly as

         24         before.  A lot of the time is spent in terms of legal

         25         review internally.  But also the clients have legal
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          1         review.  So there is a process on both sides.  I don't

          2         think it's often calculated -- I can't think of one

          3         that's taken that long once everyone agreed on the

          4         easement document.  So that process --

          5              COMMISSIONER GALLAGHER:  Isn't there a standard

          6         easement document and all you do is fill in --

          7              MR. LOVERN:  Well, there's legal descriptions and

          8         that sort of thing that have to be reviewed and

          9         developed.

         10              GOVERNOR BUSH:  Well, I would urge you, just as

         11         you-all have been very successful in streamlining the

         12         acquisition of public lands or lands that we want to

         13         become public, and we've shortened that time frame and

         14         we've reengineered that process, I would urge you to

         15         consider looking at this process and creating some best

         16         practices to shrink that down.  I know you can do it

         17         because you've done it in a lot of different areas of

         18         the Department.  The Department is much more efficient

         19         than it once was and less bureaucratic.  That may

         20         create some consternation for people because the

         21         bureaucracy and slowness may have helped some people

         22         that were not anticipating efficiencies in terms of our

         23         ability to regulate.  But having said that, if this is

         24         a problem, I know you can figure out how to address it.

         25              MR. LOVERN:  Yes, sir.  And specifically in the
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          1         Division, with regard to sovereignly submerged lands

          2         documents, we recently completed, in conjunction with

          3         the inspector general's office, a mapping of all the

          4         processes in the Division.  So it's taken a year to get

          5         that done.  We're now beginning to look at each one

          6         individually to put whatever improvements in place we

          7         can.

          8              GOVERNOR BUSH:  Excellent.  Thank you.

          9              MR. STOUTAMIRE:  Two quick comments.  Please

         10         understand that this rule does include a letter of

         11         consent for activities necessary to protect public

         12         health, safety, and welfare.  And Suzanne Brantley, our

         13         counsel, has called something to my attention.  At this

         14         point in the adoption process we cannot notice public

         15         workshops under Chapter 120.  So what we will do is

         16         notice three additional public hearings.

         17              GOVERNOR BUSH:  That's fine.

         18              MR. STOUTAMIRE:  Is that okay?

         19              GOVERNOR BUSH:  Yeah, that's even actually more.

         20         Thank you.  Secretary?

         21              MR. STRUHS:  Good morning, Governor.  I'm sorry

         22         for my tardiness this morning.  But the good Lord is

         23         smiling on us today.  Because, in fact, Item 3 is

         24         focussed specifically on--

         25              GOVERNOR BUSH:  That's good to know.  I woke up
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          1         this morning and wondered if the good Lord was going to

          2         smile on me.

          3              MR. STRUHS:  Item 3 just happens to be an item in

          4         which we will be looking to accelerate the approval

          5         process for easements.  So sometimes these things are

          6         just remarkably --

          7              GOVERNOR BUSH:  Providential.

          8              MR. STRUHS:  Providential, that's right.

          9              COMMISSIONER GALLAGHER:  Well, as you're hitting

         10         Item 3, I'd like to move Item 3 but make the delegation

         11         of authority five acres.

         12              MR. STRUHS:  And that is fine with us.  We've

         13         spoken to your cabinet aides and they're more

         14         comfortable with five over ten and we're fine with

         15         that.

         16              COMMISSIONER BRONSON:  Second.

         17              GOVERNOR BUSH:  Moved and seconded.  Without

         18         objection, the item is approved.

         19              MR. STRUHS:  Just for the audience's benefit, what

         20         this does is, we currently had delegated to the

         21         Department the ability to approve easements on uplands

         22         up to a quarter of an acre.  This would now make that

         23         five acres which means we can get more of these

         24         processed faster.

         25              And, indeed, Item No. 4, Providence continues to
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          1         shine on us.  Item 4 is an example of a case that would

          2         actually benefit from the action just taken by your

          3         Board of Trustees.  So in the future, an item like No.

          4         4 would no longer be in the agenda.  It would just move

          5         through and get done.

          6              GOVERNOR BUSH:  Is there a motion?

          7              COMMISSIONER GALLAGHER:  Motion on 4.

          8              COMMISSIONER BRONSON:  Second.

          9              GOVERNOR BUSH:  Moved and seconded.  Show how

         10         efficient we are.  Without objection, the item passes.

         11              COMMISSIONER GALLAGHER:  Motion to defer 5.

         12              MR. STRUHS:  And a note on 5, sir --

         13              GOVERNOR BUSH:  There is a motion to defer until

         14         June 26th and a second.  Without objection, the item is

         15         deferred.

         16              MR. STRUHS:  Another example of how all these

         17         things interlock.  Item 5 is an example of an easement

         18         that would be delegated.  But, in fact, because it is

         19         an issue that has heightened public concern, even with

         20         the delegation --

         21              COMMISSIONER GALLAGHER:  Motion on 6.

         22              (Laughter.)

         23              MR. STRUHS:  It all fits together.

         24              GOVERNOR BUSH:  There's a motion on 6.  Is there a

         25         second?
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          1              COMMISSIONER BRONSON:  Second.

          2              GOVERNOR BUSH:  Moved and seconded.  Without

          3         objection, the item is approved.  Get ahead of the

          4         curve here, David.

          5              MR. STRUHS:  I'm with you, sir.  Item No. 7.

          6              COMMISSIONER GALLAGHER:  Motion on 7.

          7              GOVERNOR BUSH:  You want to, just for the public,

          8         announce --

          9              MR. STRUHS:  Yes, sir.  This is an option

         10         agreement for 71 acres in the Chassahowitzka Swamp

         11         Wildlife Management Area to be managed by the Florida

         12         Fish and Wildlife Conservation Commission.

         13              GOVERNOR BUSH:  Thank you, there's a motion.

         14              COMMISSIONER BRONSON:  Second.

         15              GOVERNOR BUSH:  And a second.  Without objection,

         16         the item is passed.

         17              MR. STRUHS:  Item 8, I'd like to just point out

         18         that there is an issue on Item 8 as it relates to the

         19         process apart from the substance.  And one of the

         20         things that I promised you-all back in September of

         21         last year is that in our ongoing efforts to improve the

         22         efficiency of our land acquisition efforts, that we

         23         would come back to you and seek your agreement to move

         24         forward with some additional means of improving those

         25         efficiencies.  We now have one of those options before
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          1         you.  And what we would seek today is your guidance,

          2         your advice as we move forward.  And to the extent that

          3         you're interested in a description of the kind of

          4         contracts we're looking to enter into, we're prepared

          5         to do that.

          6              COMMISSIONER GALLAGHER:  I'll move to accept

          7         Item 8.

          8              GOVERNOR BUSH:  Is there a second?

          9              ATTORNEY GENERAL CRIST:  I'll second it.  But I'd

         10         like you to go ahead and elaborate as you've

         11         volunteered.

         12              MR. STRUHS:  Yes, sir.  And I'm going to ask

         13         Mr. Lovern to describe this in brief.  A lot of you

         14         have been already briefed in detail on this.  But,

         15         again, for the public's benefit, a quick overview.

         16              MR. LOVERN:  Good morning.  I'm Rob Lovern,

         17         assistant director of State Lands again.  The item in

         18         question today is, again, a continuation of efficiency

         19         efforts that we've put in place throughout the

         20         Division.  And brief history is that state lands has

         21         privatized quite a few functions over the last ten to

         22         12 years with the advent of the P2000 program and then

         23         moving into Florida Forever.  We've been very

         24         successful with that.  I think it's part of the

         25         foundation of the reduction and process times.  We've
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          1         reduced by 46 percent the acquisition time line.  It's

          2         a result of being able to process more work, more

          3         volume faster than what we were able to do with the

          4         staff that we have.

          5              Staffing in our Division has remained relatively

          6         constant since about 19, I think, 88.  1990, of course,

          7         with P2000, we received a 250 percent increase in

          8         funding and thereby workload but the staffing, again,

          9         has remained relatively constant.  So during the ten

         10         years of P2000 and entering into Florida Forever, we've

         11         used private contractors to reach the programmatic

         12         objectives and the objectives of the Trustees.

         13              This latest effort that David stated that he had

         14         mentioned to you back in September involves privatizing

         15         some of the private real estate services.  And part of

         16         how this came about was our studying the processes

         17         again and what's happening in the processes and what

         18         results we're getting.  And we notice that over the

         19         last two years, for instance, we used earlier data

         20         which is the same.  But over the last two years, we

         21         noticed that out of all the appraisals, for instance,

         22         that we acquired, 40 percent of those resulted in an

         23         acquisition.  So conversely 60 percent did not, so

         24         60 percent of the appraisals we obtained.  And the

         25         costs of those appraisals were about $550,000 per year.
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          1              We also, if you -- in our process, understand that

          2         the acquisition agents may make contact with owners,

          3         they spend a lot of time doing that.  They develop a

          4         request for an appraisal.  We have to get an appraisal

          5         map and then we get an appraisal.  So there's a lot

          6         more workload involved with an appraisal than just

          7         obtaining that.

          8              And in this case, the appraisal maps alone that

          9         accompanied those appraisals were about $600,000 per

         10         year.  With staff time, we did a calculation of that,

         11         comes to about 1.4 million a year.  So over the last

         12         two years, we've averaged about $2.5 million in work

         13         that turned out to be nonproductive.  It did not result

         14         in the acquisition of land.  So our effort is to try to

         15         use some private contractors to do what we've dubbed

         16         the project, Project Triage.  Which in the current

         17         evaluation process for projects, there is an

         18         extraordinary focus on resources which is important.

         19         That's what the purpose of the program is and we aren't

         20         suggesting any change to the evaluation of the

         21         resources.

         22              One element that's not done at this point is a

         23         thorough evaluation of the feasibility of the project

         24         from a real estate perspective.  While the resource may

         25         be pristine, if the owners are not willing to sell to
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                         BOARD OF TRUSTEES, May 28, 2003                   60
          1         us, then it doesn't benefit the program that we can't

          2         buy it but we spend a lot of money finding that out.

          3         So the idea for efficiency is that we put an extreme

          4         focus up front on a project as opposed to the current

          5         process of mapping and appraising, negotiating to find

          6         out we're not going to be successful.

          7              We're suggesting that if we use private

          8         contractors to do feasibility studies on projects, to

          9         do market research on projects, to do owner contact on

         10         projects under our name, and begin that process of

         11         evaluating the real estate viability of the project

         12         prior to us spending money, we think that over time if

         13         we improve our ratio of success from 40 percent to 75,

         14         we can save about $1.9 million per year.  That figure

         15         will take a couple of years to reach simply because of

         16         the -- I'm sorry?

         17              GOVERNOR BUSH:  Commissioner.

         18              COMMISSIONER BRONSON:  Well -- and after our

         19         discussion yesterday, I did a lot of thinking about

         20         this whole process.  And, of course, taking it point by

         21         point as you're giving it now, it makes sense that you

         22         would probably save some money in the end by doing

         23         this.  But on the other hand, I got to thinking, why

         24         would you not go to, if you've got a targeted area that

         25         the committee has selected as a potential for an
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                         BOARD OF TRUSTEES, May 28, 2003                   61
          1         important property for state lands, find out what the

          2         owner is willing to talk about as far as price and so

          3         forth to get an idea if they are so far out of line

          4         that you know it's not worth going to have all the

          5         mapping done and everything else.

          6              And instead of just going out and mapping and

          7         spending all that money and engineers and people with

          8         environmental backgrounds to go out and make all these

          9         analyses, why would you spend that money if the people

         10         aren't really in the mood to sell to start with?

         11              MR. LOVERN:  Part of the process of the project

         12         ranking is just that.  Whoever proposes is required to

         13         submit to us that the owners are willing to sell.  I

         14         think what happens though is are they really willing to

         15         sell or are they interested in making some money on

         16         their property which is two different things.

         17              A lot of times we get, in an application, it says

         18         that we've contacted all the owners, they're all

         19         willing to sell.  We haven't done that evaluation from

         20         a real estate perspective.  They may be thinking that

         21         in terms of a government program they're going to make

         22         a lot of money on their property.  So they're really

         23         saying, We may be interested if you pay us what we have

         24         in mind.

         25              So the real issue is aligning expectations.  You
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                         BOARD OF TRUSTEES, May 28, 2003                   62
          1         can, again, go out, and if the expectations are not

          2         aligned, which is the case now, you may find everyone

          3         saying, Yes, and then later on in the process saying,

          4         No.  In this case we would like to find out what the

          5         real -- maybe some more general studies on evaluations,

          6         possibly a letter that goes out and says, Our research

          7         indicates the value range is 15 to 1800.  What are you

          8         thinking?

          9              So it would require some work for us to get there.

         10         Another factor is sort of incidental to this.  One of

         11         the next things we're doing is developing some very

         12         advanced databases and management information systems

         13         in the Division.  That's part of our process mapping

         14         effort, is to develop a system that encompasses

         15         efficient processes.  So our staff will also be

         16         spending a lot of time with that.

         17              And part of this effort is, for instance, to have

         18         someone build an ownership database on a CD ROM that we

         19         could use for mail-outs.  Instead of going owner by

         20         owner, we could do more mass contacting.  And the

         21         effort would be that in a list that now contains about

         22         $2.5 billion worth of property and where we have about

         23         $105 million a year to spend which nets out about 95

         24         million, so that 95 million, the question we have is,

         25         Where do we apply that resource?  Where do we apply
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                         BOARD OF TRUSTEES, May 28, 2003                   63
          1         staff time?

          2              And so with a list that revolves around a

          3         six-month cycle, we have to constantly be in that mode.

          4         And, Commissioner, I certainly agree with what you said

          5         and that's the intent of what we want to do, but we

          6         also have the issue of the value of the resource.  So

          7         the idea is not simply that we evaluate the real estate

          8         viability because it may be a very pristine resource.

          9              The idea is that we could move to some other

         10         strategy to help facilitate success in the project.

         11         It's not that we would want to walk away from it.  It's

         12         what other creative approaches can we use to moving

         13         this project from a marketing perspective into becoming

         14         a viable project.  So it wouldn't be the idea of

         15         neglecting the resource but using approaches other than

         16         those that we've used in the past.

         17              GOVERNOR BUSH:  A couple comments.  You used the

         18         word "privatization."  This is an outsource effort.  I

         19         don't think it's privatization.  The people that might

         20         oppose privatization wouldn't necessarily oppose this

         21         because this will allow us to buy more property at a

         22         more efficient price to allow us to buy more property.

         23         And words matter so I just urge you to use the right

         24         language.  I'll be reading about it.  Once it's

         25         repeated four times, it becomes the law of the land in
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                         BOARD OF TRUSTEES, May 28, 2003                   64
          1         Florida.

          2              MR. LOVERN:  Yes, sir.  I agree.

          3              COMMISSIONER BRONSON:  The other issue, Governor,

          4         I want to make sure, I want to make sure in this

          5         process -- and I know where you're going and I

          6         understand where you're going and why you're getting

          7         there.  But I don't want us necessarily to go out and

          8         pick the No. 30 just to buy No. 30 on the list if

          9         No. 30 isn't near as important as its total

         10         environmental issues as No. 1 is.  And I'm not saying

         11         we ought to just go after No. 1 no matter what.

         12              But what I'm saying is, I don't want us going and

         13         buying lands that aren't as important as hubs in the

         14         puzzle, if you will, that we may need to connect the

         15         dots on some other properties and do some things for

         16         habitat and so forth which has been one of the issues

         17         in the state of Florida.  Just to go get No. 30 because

         18         that person is willing to deal with us and maybe we

         19         didn't spend enough time working with the other people

         20         to get them to come around to get a more important

         21         piece of property that may need to be saved.

         22              MR. LOVERN:  Yes, sir.  That's a very important

         23         point and that's not our intent.  The concept with the

         24         A group -- as you know, now we have an A and a B

         25         group -- is that they are all equal.  If they made it
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                         BOARD OF TRUSTEES, May 28, 2003                   65
          1         into the A group, they're equal in resource.  Of

          2         course, some may disagree with that that support a

          3         particular project --

          4              GOVERNOR BUSH:  Yeah, the properties on the B

          5         group, they're the ones that disagree with the A group.

          6              (Laughter.)

          7              MR. LOVERN:  Absolutely.  Yes, sir.  Because, as

          8         you know, on those we require at least a 50 percent

          9         discount to bargain-share to go after those deals.

         10              GOVERNOR BUSH:  I have another question.

         11              MR. LOVERN:  Yes, sir.

         12              GOVERNOR BUSH:  If you use real estate service

         13         companies, don't you have the opportunity to save money

         14         for having them become a cooperating broker rather than

         15         us pay them?  I mean, we've had deals here where we

         16         could have saved -- some of these big timber deals, had

         17         we had a broker representing our interests, we could

         18         have got 50 percent of the commission and maybe

         19         negotiated with that real estate broker a more

         20         aggressive beneficial participation and the state could

         21         have some savings.  I may have said something that was

         22         close to breaking the law, but I didn't mean it.

         23              The idea is from a business perspective there is

         24         money on the table that doesn't go into the pockets of

         25         the seller that the buyer ultimately pays that if we
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                         BOARD OF TRUSTEES, May 28, 2003                   66
          1         negotiate this the right way, it will dwarf the savings

          2         that you're talking about in terms of efficiencies.

          3              MR. LOVERN:  Yes, sir.  The idea would be that

          4         on -- the contracts that we're proposing are task

          5         assignment contracts which means we have an umbrella

          6         contract that covers general concepts yet each task

          7         that we issue would be negotiated individually.  So our

          8         project managers within the Bureau of Land Acquisition

          9         would look at the particular property for sale.  And,

         10         yes, if it's listed by a broker, part of the commission

         11         that may be received by our contractor would be --

         12         we've got to get into the legalities of representation

         13         with that.  But could they split the commission with

         14         the listing broker, yes, and that's one of the things

         15         we're looking at.

         16              We had provided to you a chart as an example of

         17         those commission structures.  It's important to keep in

         18         mind we haven't yet entered into negotiations with the

         19         contractors.  This was an analysis of whether we could

         20         pay commissions that were based purely on productivity,

         21         time, and dollar savings to the Florida Forever program

         22         and still keep the total cost below the approved

         23         value -- I'm sorry, the pure value which is the

         24         appraised value of the acquisition.  And we think we

         25         have the proposal to enter into negotiations with these
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                         BOARD OF TRUSTEES, May 28, 2003                   67
          1         contractors that will get us there.

          2              Again, we're not obligated with the contract to

          3         ever use a contractor.  We make no commitment to

          4         provide any level of work, ever give them a task.  We

          5         have the option at any time if they do not perform

          6         effectively and efficiently, we have the option of

          7         never doing any more work with them.  So our idea and

          8         focus is on performance.  It's on companies that will

          9         produce the results that we need and will do it

         10         efficiently and save money for the Florida Forever

         11         program.

         12              GOVERNOR BUSH:  Any other discussion?  There is a

         13         motion and a second.  Without objection, the item is

         14         approved.  Go forth and do good work.

         15              COMMISSIONER GALLAGHER:  Motion to defer No. 9.

         16              COMMISSIONER BRONSON:  Second.

         17              GOVERNOR BUSH:  There is a motion to defer Item 9

         18         and a second.  Without objection, the item is deferred.

         19              MR. STRUHS:  Governor, I just wanted, sir, to add

         20         that on Item No. 8 we will plan on coming back in about

         21         six months to give you a status report as to our

         22         progress so we keep you informed as we go.  And if I

         23         could -- I can't.  I'd like to just take 60 seconds if

         24         I might.

         25              Last night, the Florida Legislature enacted the
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                         BOARD OF TRUSTEES, May 28, 2003                   68
          1         Everglades funding plan for the next several years that

          2         Governor Bush was the architect of --

          3              GOVERNOR BUSH:  We talked about that already

          4         before you came.

          5              MR. STRUHS:  Excellent.  $1.7 billion new and

          6         additional revenue for Everglades restoration that

          7         doesn't affect these other important land conservation

          8         programs around the state of Florida.  You won't read

          9         that in any paper this morning --

         10              GOVERNOR BUSH:  I said that too.  You're on

         11         message.

         12              (Laughter.)

         13              COMMISSIONER GALLAGHER:  You're on the script.

         14         There's no doubt about it.

         15              MR. STRUHS:  That was completely unrehearsed.

         16              GOVERNOR BUSH:  That's for sure.









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                   STATE BOARD OF ADMINISTRATION, May 28, 2003             69
          1              GOVERNOR BUSH:  State Board of Administration.

          2              COMMISSIONER GALLAGHER:  Motion on the minutes.

          3              ATTORNEY GENERAL CRIST:  Second.

          4              GOVERNOR BUSH:  There's a motion and a second.

          5         Item 1 is approved without objection.

          6              Item 2.

          7              MR. STIPANOVICH:  Item 2, the Florida -- excuse

          8         me.  Item 2, approval of fiscal sufficiency of an

          9         amount not exceeding 240,000,000 State of Florida, full

         10         faith and credit, State Board of Education public

         11         education capital outlay refunding bonds.

         12              COMMISSIONER GALLAGHER:  Motion on 2.

         13              ATTORNEY GENERAL CRIST:  Second.

         14              GOVERNOR BUSH:  Moved and seconded.  Without

         15         objection, Item 2 is passed.

         16              MR. STIPANOVICH:  Item No. 3 is, Requesting

         17         approval of fiscal sufficiency of an amount not

         18         exceeding 44,630,000 State of Florida, full faith and

         19         credit, State Board of Education capital outlay bonds.

         20              ATTORNEY GENERAL CRIST:  Motion.

         21              COMMISSIONER GALLAGHER:  Second.

         22              GOVERNOR BUSH:  Moved and seconded.  Without

         23         objection, the item is approved.

         24              MR. STIPANOVICH:  Item 4, Request approval of the

         25         fiscal determination of aggregate amounts not exceeding
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                   STATE BOARD OF ADMINISTRATION, May 28, 2003             70
          1         50 million Florida Housing Finance Corporation

          2         homeowner mortgage revenue bonds.

          3              ATTORNEY GENERAL CRIST:  Motion.

          4              COMMISSIONER GALLAGHER:  Second.

          5              GOVERNOR BUSH:  Moved and seconded.  Without

          6         objection, the item is approved.

          7              MR. STIPANOVICH:  Item No. 5, Request approval of

          8         fiscal determination of an amount not exceeding

          9         12,200,000 tax exempt Florida Housing Finance

         10         Corporation multifamily mortgage revenue bonds.

         11              ATTORNEY GENERAL CRIST:  Motion.

         12              COMMISSIONER GALLAGHER:  Second.

         13              GOVERNOR BUSH:  Moved and seconded.  Without

         14         objection, the item is approved.

         15              MR. STIPANOVICH:  Item No. 6 is the Florida

         16         Hurricane Catastrophe Fund requests consideration for

         17         Rule 6.1 which is the Florida Hurricane Catastrophe

         18         Fund, requests the Trustees approve filing of Rule

         19         19-8.028.  This rule was unanimously approved by the

         20         Board on April the 8th.  We're just requesting approval

         21         filing.

         22              COMMISSIONER GALLAGHER:  I'll move 6.1 and 6.2.

         23              GOVERNOR BUSH:  There is a motion --

         24              ATTORNEY GENERAL CRIST:  Second.

         25              GOVERNOR BUSH:  -- for 6.1 and 6.2 and a second.
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                   STATE BOARD OF ADMINISTRATION, May 28, 2003             71
          1         Any discussion?  Without objection, the item passes.

          2         Thank you, Coleman.

          3              MR. STIPANOVICH:  Governor, members, we will be

          4         bringing the budget to you hopefully at the next

          5         cabinet meeting.

          6              GOVERNOR BUSH:  Thank you.

          7              (Thereupon, the proceedings adjourned at 11:00

          8         a.m.)

















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                   STATE BOARD OF ADMINISTRATION, May 28, 2003             72

          2                      CERTIFICATE OF REPORTER


          4    STATE OF FLORIDA    )

          5    COUNTY OF LEON      )


          7              I, KRISTEN L. BENTLEY, Court Reporter, certify

          8    that the foregoing proceedings were taken before me at the

          9    time and place therein designated; that my shorthand notes

         10    were thereafter translated under my supervision; and the

         11    foregoing pages numbered 1 through 72 are a true and correct

         12    record of the aforesaid proceedings.


         14              I further certify that I am not a relative,

         15    employee, attorney or counsel of any of the parties, nor am

         16    I a relative or employee of any of the parties' attorney or

         17    counsel connected with the action, nor am I financially

         18    interested in the action.

         19              DATED this 2nd day of June, 2003.

         20                              ______________________________

         21                             KRISTEN L. BENTLEY, Court Reporter
                                        Notary Public
         22                              850-878-2221



                              ACCURATE STENOTYPE REPORTERS, INC.