Representing:
DIVISION OF BOND FINANCE
FINANCIAL MANAGEMENT INFORMATION
BOARD
FINANCIAL SERVICES COMMISSION OFFICE OF INSURANCE
REGULATION
DEPARTMENT OF REVENUE
BOARD OF TRUSTEES OF THE INTERNAL
IMPROVEMENT TRUST FUND
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 the 24th day of August, 2004, commencing at
approximately
9:30 a.m.
Reported by:
KRISTEN L.
BENTLEY
Certified Court Reporter
ACCURATE STENOTYPE REPORTERS,
INC.
2894 REMINGTON GREEN
LANE
TALLAHASSEE, FL 32308 (850)878-2221
.
2
APPEARANCES:
Representing the Florida Cabinet:
JEB
BUSH
Governor
CHARLES H.
BRONSON
Commissioner of Agriculture
CHARLIE
CRIST
Attorney General
TOM
GALLAGHER
Chief Financial Officer
* * *
ACCURATE STENOTYPE REPORTERS, INC.
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3
I N D E X
DIVISION OF BOND
FINANCE
(Presented by BEN WATKINS)
ITEM
ACTION
PAGE
1
Approved
5
2
Approved
7
3
Approved
7
FINANCIAL MANAGEMENT INFORMATION
BOARD
(Presented by DON NORTHAM)
ITEM
ACTION
PAGE
1
Approved
8
2
Approved
11
FINANCIAL SERVICES
COMMISSION
(Presented by KEVIN McCARTY)
ITEM
ACTION
PAGE
1
Approved
12
2
Approved
15
3
Approved
15
4
Approved
16
5
Approved
16
DEPARTMENT OF
REVENUE
(Presented by JAMES ZINGALE)
ITEM
ACTION
PAGE
1
Approved
17
2
Approved
18
3
Approved
20
4
Approved
20
5
Approved
21
ACCURATE STENOTYPE REPORTERS, INC.
.
4
I N D E X - Continued
BOARD OF TRUSTEES OF THE INTERNAL IMPROVEMENT TRUST
FUND
(Presented by COLLEEN CASTILLE)
ITEM
ACTION
PAGE
1
Approved
22
2
Approved
31
3
Approved
33
4
Approved
41
5
Approved
47
6
Approved
48
7
Approved
49
8
Approved
66
9
Approved
69
10
FAILED
112
STATE BOARD OF
ADMINISTRATION
(Presented by COLEMAN STIPANOVICH)
ITEM
ACTION
PAGE
1
Approved
136
2
Approved
136
3
Approved
136
ACCURATE STENOTYPE REPORTERS, INC.
.
DIVISION OF BOND FINANCE -
8/24/04
5
1
PROCEEDINGS
2
THE GOVERNOR: The next cabinet meeting is Wednesday
3 September 8th,
2004. Division of Bond Finance.
4
CFO GALLAGHER: Motion on the minutes.
5
COMMISSIONER BRONSON: Second.
6
THE GOVERNOR: Moved and seconded. Without
7 objection, Item 1
passes.
8
Good morning.
9
MR. WATKINS: Good morning. Item No. 2 is -- are
10 resolutions relating
to the state infrastructure bank for
11 the Department of
Transportation. It is a new revolving
12 loan program to be
administered by DOT for loans to local
13 governments and to
DOT districts. The resolutions do two
14 things. One is
to authorize the issuance of up to
15 $300 million in state
infrastructure bank bonds. And,
16 secondly, to
authorize the negotiated sale for up to
17 $65 million for the
inaugural issue of this new financing
18 program.
19
CFO GALLAGHER: Ben, why would we do negotiated on
20 this as opposed to
competitive?
21
MR. WATKINS: It was a new financing program
22 involving a state
revolving loan fund. We had been -- the
23 legislation
authorizing the issuance was back in 2003.
24 And it has been nine
months and us working on this
25 program. But we
brought an analysis of negotiated
versus
ACCURATE STENOTYPE REPORTERS, INC.
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DIVISION OF BOND FINANCE -
8/24/04
6
1 competitive but it's
been about a year ago and brought it
2 to you and got the
authorization. But the fundamental
3 underlying reason is
new credit and the revolving nature
4 of the program.
And we didn't have the expertise in-house
5 to structure the
transaction. So we engaged underwriters
6 through an RFP process
on this new financing program.
7
CFO GALLAGHER: Aren't the bonds that we do over, the
8 old comptroller bonds,
the revolving type?
9
MR. WATKINS: That's more of a credit facility, the
10 Consolidated
Equipment Financing Program. Yes, it is --
11 it's a completely
different credit and not really a
12 revolver. But
the fundamental underlying reason is new
13 program, utilize the
expertise that was available through
14 the investment
banking firms in order to structure the
15 program. Now,
once it's structured, we can revisit the
16 issue. We'll do
the inaugural issue negotiated and then
17 we can evaluate
prospectively whether it makes sense to
18 execute competitively
or negotiated and which is going to
19 be most efficient and
the best way to execute the
20 transaction for the
State.
21
CFO GALLAGHER: Have we chosen an investment banker
22 for this yet?
23
MR. WATKINS: Excuse me?
24
CFO GALLAGHER: Have we chosen an investment banker
25 for this yet or is it
under
process?
ACCURATE STENOTYPE REPORTERS, INC.
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DIVISION OF BOND FINANCE -
8/24/04
7
1
MR. WATKINS: Yes. No, we did about nine months ago.
2
CFO GALLAGHER: And it is?
3
MR. WATKINS: The senior managing underwriter is
4 Merrill Lynch but then
there are about 80 additional firms
5 behind that that
comprise the syndicate; national firms,
6 regional firms and
minority firms.
7
CFO GALLAGHER: Okay. Motion on 2.
8
COMMISSIONER BRONSON: Second.
9
THE GOVERNOR: Moved and seconded. Without
10 objection, the motion
passes.
11
MR. WATKINS: Item No. 3 is a report of award on the
12 competitive sale of
$21,495,000 in capital outlay bonds
13 for the State Board
of Education. The bonds were awarded
14 to the low bidder at
a true interest cost rate of
15 approximately 4.28
percent.
16
GENERAL CRIST: Motion on 3.
17
CFO GALLAGHER: Second.
18
THE GOVERNOR: Moved and seconded. Without
19 objection, the motion
passes.
20
Thank you, Ben.
21
22
23
24
25
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL MANAGEMENT INFORMATION BOARD -
8/24/04
8
1
THE GOVERNOR: Financial Management Information
2 Board.
3
CFO GALLAGHER: Motion on the minutes.
4
GENERAL CRIST: Second.
5
THE GOVERNOR: There's a motion and a second.
6 Without objection,
Item 1 passes.
7
Item 2.
8
MR. NORTHAM: Good morning. The second item on the
9 FMIB agenda today is
the submission of the ERP integration
10 task force quarterly
report. The task force is required
11 by statute to report
progress made on recommendations
12 submitted to the FMIB
and adopted, of which there are two.
13 The first of these
was the recommendation to change the
14 composition of both
the FMIB and the task force.
15
THE GOVERNOR: That's not an attractive depiction of
16 Commissioner Bronson,
by the way.
17
(Laughter.)
18
CFO GALLAGHER: I don't know. He looks pretty thin
19 there.
20
(Laughter.)
21
MR. NORTHAM: And this modification has been
22 accomplished and
today marks the first time that the FMIB
23 is meeting in its
newly reconstituted form.
24
The second recommendation adopted by the FMIB was to
25 adopt the goal of
determining the best means of
satisfying
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL MANAGEMENT INFORMATION BOARD -
8/24/04
9
1 the enterprise
information and reporting needs of Florida
2 state
government. And that's the first step to produce
3 and publish enterprise
information needs analysis.
4
This analysis was conducted from February through May
5 of this year with the
participation of OPB staff, House
6 and Senate
appropriation committee staff, members of the
7 Florida Association of
State Budget Officers and the
8 Florida Association of
State Agency administrative service
9 directors. The
executive summary of this information
10 needs analysis is
included in our quarterly report and
11 here are the
highlights.
12
Study participants identified a significant need for
13 accurate and timely
answers to nearly 300 questions. The
14 ERP project teams
affirmed the capability to answer nearly
15 80 percent of these
questions, has already been specified
16 in their
designs. However, these answers will reside in
17 five separate systems
and in some cases will require data
18 from more than one
system to get the answer.
19
Participants went on to describe desired improvements
20 in information
delivery starting with, if at all possible,
21 avoiding the need to
become proficient in five separate
22 systems to get the
information they need to do their work.
23 The task force is
investigating options for creating a
24 single enterprise
view using this information.
25
Finally, the quarterly report contains a
description
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL MANAGEMENT INFORMATION BOARD -
8/24/04
10
1 of the minimum
interoperability required for these ERP
2 subsystems to carry
out their essential functions. These
3 information exchanges
shown as numbered arrows on this
4 diagram, which was
developed in collaboration with the
5 project teams and with
subject matter experts, is a
6 projection of how
these systems will look when all the
7 current projects are
completed. That's slated for
8 December 2005.
9
From this picture, we concluded the following. For
10 the most part,
interoperability will be achieved by
11 establishing
interfaces with the Aspire project or the
12 Aspire system.
Second, that interoperability will be
13 achieved using far
fewer functional interfaces than we
14 previously
believed. In this case, we've identified 25
15 and that number is
likely to actually go down slightly.
16 Two other points
regarding this picture. The task force
17 has a process for
tracking and reporting the progress on
18 establishing the
interfaces required to achieve basic
19 interoperability
shown in this diagram. And, second,
20 while the need for
the functional interfaces will not
21 change, the means of
accomplishing it might change which
22 will result in
changes in this diagram as we go forward.
23
That concludes my prepared remarks.
24
THE GOVERNOR: Any questions? Do we have a motion?
25
GENERAL CRIST:
Motion.
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL MANAGEMENT INFORMATION BOARD -
8/24/04
11
1
THE GOVERNOR: To accept, I guess?
2
CFO GALLAGHER: Second.
3
MR. NORTHAM: Yes, sir.
4
THE GOVERNOR: And a second. Without objection, the
5 report is
accepted. Thank you very much.
6
MR. NORTHAM: Thank you, sir.
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
ACCURATE STENOTYPE REPORTERS, INC.
.
FINANCIAL SERVICES COMMISSION -
8/24/04
12
1
THE GOVERNOR: Financial Services Commission. Office
2 of Insurance
Regulation.
3
CFO GALLAGHER: Motion on the minutes.
4
GENERAL CRIST: Second.
5
THE GOVERNOR: Motion and a second. Without
6 objection, Item 1
passes.
7
MR. McCARTY: Good morning, Governor, members of the
8 Financial Service
Commission. Item No. 2 is request
9 adoption of emergency
Rule 69OER04-05 which establish
10 limits on
cancellation and nonrenewal of insurance
11 policies for victims
of Hurricane Charley. The primary
12 purpose of this rule
is to provide temporary and emergency
13 relief to persons
located within the designated 12
14 counties as well as
other victims who can demonstrate
15 losses as a result of
Hurricane Charley.
16
GENERAL CRIST: Motion on 3.
17
CFO GALLAGHER: I have an amendment I'd like to
18 offer.
19
THE GOVERNOR: There's a motion and a second. And
20 the floor is yours,
Treasurer.
21
CFO GALLAGHER: Thank you. I'd like to add the
22 following language
and have a moment to explain. It would
23 say additionally the
Financial Services Commission hereby
24 delegates to the
commissioner of the Office of Insurance
25 Regulation temporary
and limited authority to
issue
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL SERVICES COMMISSION -
8/24/04
13
1 supplemental emergency
rules that prohibit cancellation or
2 nonrenewal of the
homeowners, renters, condo unit owners,
3 mobile home or other
policy covering a dwelling or
4 residential property
located in counties affected by
5 Hurricane Charley
which properties has suffered a partial
6 loss for a period of
60 days after the dwelling or
7 property has been
repaired.
8
We found that we needed to do this, have this
9 language in our
emergency rules on Hurricane Andrew
10 because of the fact
that some policies will, even after
11 the 60 days, be
nonrenewed and people have not either
12 finished or gotten
paid or whatever else on their
13 property. This
doesn't do it immediately but it does give
14 Commissioner McCarty
the ability to do this if necessary.
15
It also is necessary when, in fact, there is no
16 market for someone to
go and buy additional insurance
17 which we also found
because in Hurricane Andrew, we had
18 well over a million
-- well over a million policyholders
19 that were going to be
nonrenewed and that became a huge
20 problem, primarily
those that were in -- not only in
21 Hurricane Andrew's
path, but also in other places in the
22 state. So this
will give -- Commissioner, just
23 specifically add that
to the role. So I move this
24 amendment.
25
MR. McCARTY: Point of information. I
think,
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL SERVICES COMMISSION -
8/24/04
14
1 Treasurer Gallagher,
more appropriately that is under the
2 rubric of delegation
of authority which is Item No. 5.
3
CFO GALLAGHER: No. 5, that's correct.
4
THE GOVERNOR: Rather than Item 2, is that what
5 you're saying?
6
MR. McCARTY: That's correct, Governor.
7
CFO GALLAGHER: Oh, I thought we were doing 2 through
8 5 right now.
That was 1. Okay. We're doing just 2?
9 I'll wait until 5.
10
THE GOVERNOR: I'd like for you to describe in
11 plainspoken English
what these items do. I'm for them, I
12 just want everybody
else to understand.
13
CFO GALLAGHER: Why don't we do 2 and then 3 and then
14 4 and then I'll
--
15
MR. McCARTY: Yes. Starting on Item No. 2 is our
16 office issued an
emergency order last week which provided
17 temporary and
emergency relief for the victims of the
18 12-county designated
areas, victims of Hurricane Charley.
19 What this rule does,
it suspends any nonrenewal or
20 cancellation for any
policyholder in those areas. It also
21 allows people outside
that area who may have been damaged
22 by Hurricane Charley
to petition for that same relief.
23
CFO GALLAGHER: It also covers premium finance
24 companies for the
same issues.
25
THE GOVERNOR: There is a -- I believe there is
a
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL SERVICES COMMISSION -
8/24/04
15
1 motion and a second on
Item 2. Without objection. Any
2 other
discussion? Without objection, the item passes.
3
Item 3.
4
MR. McCARTY: Item 3, Governor, is a request for
5 delegation of
authority to the commissioner of our office,
6 that's myself, to
adopt emergency rules in the event
7 circumstances arise
that necessitates the suspension of
8 form and rate
filing.
9
I would like to say that after Hurricane Andrew all
10 rates and forms were
suspended for life and health and
11 property and
casualty. It is not my design at this time
12 to do that. I
just would like to have the reserve
13 authority in the
event that becomes necessary.
14
CFO GALLAGHER: Motion on 3.
15
COMMISSIONER BRONSON: Second.
16
THE GOVERNOR: There's a motion and a second.
17 Without objection,
the item passes.
18
MR. McCARTY: Item 4 is a request -- approve adoption
19 of emergency Rule
69OER04-07 that extends the one life
20 group open enrollment
period for 30 days. Ordinarily, the
21 open enrollment
period would end on August 31st. This
22 would extend the open
enrollment period under the
23 employee's health
care access after September 30th, 2004
24 for one life
groups.
25
CFO GALLAGHER:
Motion.
ACCURATE STENOTYPE REPORTERS, INC.
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FINANCIAL SERVICES COMMISSION -
8/24/04
16
1
COMMISSIONER BRONSON: Second.
2
THE GOVERNOR: There's a motion and a second.
3 Without objection, the
item passes.
4
MR. McCARTY: Item 5 is a request for delegation of
5 limited emergency
rulemaking authority to the commission
6 of the office of
insurer regulation for the next 60 days.
7 Specific authority is
being requested in order to adopt
8 necessary rules to
narrow the scope of the previous
9 adopted emergency
rules.
10
CFO GALLAGHER: And I'll move my amendment that I
11 offered earlier.
12
GENERAL CRIST: Moved.
13
THE GOVERNOR: There's a motion as amended and a
14 second. Without
objection, the item passes.
15
MR. McCARTY: Thank you, Governor.
16
THE GOVERNOR: Thank you, Kevin.
17
Kevin, did Celeste Lewis call you yesterday, just out
18 of curiosity, about
the appointment?
19
MR. McCARTY: Yes. Thank you.
20
21
22
23
24
25
ACCURATE STENOTYPE REPORTERS, INC.
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DEPARTMENT OF REVENUE -
8/24/04
17
1
THE GOVERNOR: Department of Revenue. Dr. Z.
2
DR. ZINGALE: Good morning.
3
CFO GALLAGHER: Motion on the minutes.
4
COMMISSIONER BRONSON: Second.
5
THE GOVERNOR: There's a motion and a second.
6 Without objection,
Item 1 passes.
7
Item 2.
8
DR. ZINGALE: Item 2 is a rule. And a little
9 background on this
rule because we come up here frequently
10 with these kinds of
rules. The Department of Revenue, a
11 tax agency, every
return, every form, every document that
12 we exchange back and
forth with the taxpayer, we're
13 constantly trying to
make a better communication vehicle
14 so there is a
continuous ongoing update of all of our
15 forms to make them
not only better communication vehicles,
16 but to ensure that
the taxpayer is understanding what
17 their legal
obligations are.
18
Because they may embed policy in them from time to
19 time, we go through
an extensive rulemaking process on
20 every one of these
changes that take place. That's
21 designed to not only
ensure we get input from the taxpayer
22 so we know we are
communicating, but it's also designed to
23 ensure that the
Legislature, through the JAPC oversight
24 committee, ensures
we're not embedding any changes in the
25 law in
there.
ACCURATE STENOTYPE REPORTERS, INC.
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DEPARTMENT OF REVENUE -
8/24/04
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1
What you have here is quite an extensive work
2 product. It's a
thick set of rules. There's primarily
3 just technical
revisions in these. They've been through
4 the review
process. And so we request approval of this
5 item.
6
GENERAL CRIST: Motion.
7
CFO GALLAGHER: Second.
8
THE GOVERNOR: There's a motion and a second. Any
9 discussion?
Without objection, the item passes.
10
DR. ZINGALE: Item No. 2 -- Item No. 3 deals with the
11 corporate income tax
section. It's a rule. It
12 specifically
addresses Items 220.44 of the Corporate
13 Income Tax
Code. In that section, the Department is given
14 fairly broad
authority to be able to go into a tax return
15 and make adjustments
to a tax return to more properly or
16 accurately reflect
the economic enforces that are embedded
17 in that return.
18
Historically, the Department has only used that
19 authority to go into
a return and more or less make
20 adjustments that
cause the taxpayer's liability to go up.
21 Last year, we had a
taxpayer -- we get taxpayers coming in
22 all the time making
inquiries in terms of what the
23 statutes say -- made
a request and said, Could that
24 language also be used
to benefit a taxpayer.
25
The straight reading of that statute did not
prohibit
ACCURATE STENOTYPE REPORTERS, INC.
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DEPARTMENT OF REVENUE -
8/24/04
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1 that from taking place
so we listened to the taxpayer.
2 The taxpayer
identified an economic set of circumstances
3 that looked fair and
reasonable. It was a corporation
4 that was currently
filing separately -- a lot of
5 subsidiaries filing
separate returns -- that was going out
6 and acquiring a
company that was going to make a large
7 capital investment in
Florida, a good thing, jobs,
8 revenue, income.
And that capital investment was in that
9 acquisition coming
with a company that had been
10 experiencing net
operating losses. The company wanted to
11 be able to come in
and accelerate those net operating
12 losses and to deduct
them in a positive sense against
13 those large
investments.
14
This looked fair and reasonable to us. But since it
15 was a change in the
direction the Department had typically
16 taken toward that
statute, we undertook a rulemaking
17 process, get these
issues out in the sunshine, lay them
18 forward. The
rulemaking process also ensured, as the
19 forms did, that the
Legislature, through the Joint
20 Administrative
Procedures Committee, would watch over that
21 to make sure this was
not an extension or a misuse of that
22 statute.
23
To date, we've had a number of public hearings. The
24 rule we bring in
front of you has had a number of
25 technical adjustments
that the JAPC committee has
provided
ACCURATE STENOTYPE REPORTERS, INC.
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DEPARTMENT OF REVENUE -
8/24/04
20
1 to it, provides a very
powerful tool to attract companies
2 into Florida that have
and will execute a large capital
3 investment. And
we worked really hard to put limits and
4 bounds on the use of
this provision so it provides for a
5 10 percent break
against that capital investment up to
6 $2 million over a
five-year period of time. It's been
7 through substantial
public hearing, it certainly has been
8 reviewed by the
Legislature through the JAPC commission
9 and I strongly
recommend that we adopt this rule.
10
CFO GALLAGHER: Motion on 3.
11
GENERAL CRIST: Second.
12
THE GOVERNOR: There is a motion and a second. Any
13 discussion? The
item passes without objection.
14
DR. ZINGALE: Item No. 4 is really a situation where
15 the Department head
rules, DMS head rules, DMS is the --
16 in these disciplinary
standards, the more apparent body to
17 deal with it and
we're recommending actually repeating a
18 rule today.
19
CFO GALLAGHER: Motion on 4.
20
COMMISSIONER BRONSON: Second.
21
THE GOVERNOR: There's a motion and a second.
22 Without objection,
the item passes. One small victory for
23 the embattled
libertarians.
24
DR. ZINGALE: Item No. 5 addresses a reorganization
25 the Department has
undertaken. We have an internal
appeal
ACCURATE STENOTYPE REPORTERS, INC.
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DEPARTMENT OF REVENUE -
8/24/04
21
1 process where a
taxpayer, say, after the completion of an
2 audit, chooses not to
want to go to court, an expensive
3 process to review the
results of the audit, but to
4 undertake one of our
internal appeal processes, much
5 cheaper and timely to
do that. We've reorganized that.
6 It used to be
organized with our general counsel's office.
7 We've separated it out
to ensure independence. That's
8 requiring us to go
through and restructure some of our
9 delegation of
authority. Very simple and straightforward,
10 request approval.
11
CFO GALLAGHER: Motion on 5.
12
GENERAL CRIST: Second.
13
THE GOVERNOR: There's a motion and a second.
14 Without objection,
the item passes. Thank you, Jim.
15
DR. ZINGALE: Thank you very much.
16
17
18
19
20
21
22
23
24
25
ACCURATE STENOTYPE REPORTERS, INC.
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BOARD OF TRUSTEES -
8/24/04
22
1
THE GOVERNOR: Board of Trustees of the Internal
2 Improvement Trust
Fund. Secretary Castille, how the heck
3 are you?
4
MS. CASTILLE: I'm doing very well, sir, thank you.
5
CFO GALLAGHER: Motion on the minutes.
6
COMMISSIONER BRONSON: Second.
7
THE GOVERNOR: You're out of your hurricane garb
8 today.
9
MS. CASTILLE: Yes, sir, I am.
10
THE GOVERNOR: There's a motion and a second on
11 Item 1. Without
objection, the item passes.
12
Item 2.
13
MS. CASTILLE: Item 2 is consideration of a
14 sovereignty submerged
land lease for five years to
15 Billiris in Pinellas
County. We have three of these
16 items. As you
remember, in June of 1999, the governor and
17 cabinet passed a
prohibition on gambling casino boats at
18 marinas with
submerged land leases from the Board of
19 Trustees. We
went to administrative hearing and a
20 district court of
appeals and the court of appeals found
21 that the Board of
Trustees had gone beyond its authority
22 to prohibit casino
operations from mooring at these
23 facilities. And
since that time, we have been working
24 with the lessees to
ensure that they are in compliance
25 with all of the
additional lease conditions and we
are
ACCURATE STENOTYPE REPORTERS, INC.
.
BOARD OF TRUSTEES -
8/24/04
23
1 recommending five-year
-- a renewal of a five-year lease
2 for Mr. Billiris on
Item 2.
3
CFO GALLAGHER: Colleen, do they have to have
4 permission from us on
what type of vessel is moored where
5 these leases are,
where it's tied up?
6
MS. CASTILLE: In general, we do not. We regulate
7 the size of the vessel
and whether it has impact to the
8 benthic
resources. So if there is a lagoon where there is
9 a boat that has a
draft of 6 feet and we have only 7 feet
10 or 10 feet of
clearance below the draft, it sometimes has
11 a significant impact
on the benthic resources and we do,
12 at that point in
time, come in and say the size of the
13 vessel is too large
and can't moor it here.
14
CFO GALLAGHER: Well, the reason I'm asking this, I'm
15 not big on these
cruises to nowhere. In fact, I'm not
16 even small on
them. I don't like them at all is the
17 bottom line.
But if we do a lease and we say, You can't
18 put one of these
boats there, that doesn't stop the boat
19 from going somewhere
else that already has a lease.
20
MS. CASTILLE: That's true.
21
THE GOVERNOR: Say that again.
22
CFO GALLAGHER: Well, here's my concern. We say --
23 we put in a lease,
You can't put a cruise to nowhere in
24 this spot. Then
they can go to somebody that already has
25 a lease somewhere and
lease that and we don't have any
say
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1 whether it's a cruise
to nowhere or not or a gambling
2 boat.
3
THE GOVERNOR: We don't have any say right now unless
4 we're willing to test
our constitutional authority as it
5 relates to sovereign
submerged lands based on the ruling,
6 and the appellate
ruling, as it relates to our attempt to
7 prohibit these types
of vessels based on their use.
8
Now we do have the ability, Colleen, to restrict the
9 use of, in a broader
way, don't we, of vessels that might
10 pollute?
11
MS. CASTILLE: Yes.
12
THE GOVERNOR: There may be water quality issues.
13 But you're right
about that, that we have another issue
14 which is people can
dock these babies on non sovereign
15 submerged land leases
and they do that in the Port of
16 Miami and other
places that we don't have the leases.
17
MS. CASTILLE: That's true.
18
THE GOVERNOR: Well, based on the broader issues not
19 related to the fact
that they are promoting gambling here,
20 is there any water
quality issues?
21
MS. CASTILLE: There is only a water quality issue
22 that has been
resolved on Item 4, which is Ms. Becky's
23 Seafood.
24
THE GOVERNOR: But not on Item 2.
25
MS. CASTILLE: But not on Item 2, nor on Item 3.
We
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1 had minor problems
with manatee education kiosks and
2 fenders between the
boat and the dock. But those have
3 been resolved as
well.
4
CFO GALLAGHER: Do we have speakers on this?
5
MS. CASTILLE: We have Mr. --
6
THE GOVERNOR: The place is full, so we've got
7 something coming
here. I'm not sure what the item is.
8
MS. CASTILLE: Mr. George Billiris and/or Ralph Haben
9 is here. I saw
Ralph. There he is over there. And we
10 have Agnes Rice on
Item 3 and Eric Hearn who's the
11 attorney for the item
on 4.
12
THE GOVERNOR: Good morning, sir.
13
MR. HABEN: How you doing, Governor, members of the
14 cabinet. My
name is Ralph Haben and I'm here on behalf of
15 the Rice lease which
I think is Item 3. But I'm also
16 here, I think, in a
larger way on behalf of the day
17 cruise. I know
that the cabinet does not particularly
18 like these
boats. At the end of the day, all I really
19 need today from the
cabinet is some expression that you
20 will live up to the
stipulation that you as the trustees
21 entered into with us
in re the lawsuit.
22
So I'm not talking now about an individual lease,
23 whether it be Mr.
Billiris, Ms. Rice or Becky's Seafood,
24 but rather, I don't
know what to advise my client, let me
25 tell you why.
When we appeared here four or five
years
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1 ago, we told the
governor and cabinet we do not think you
2 have the authority to
treat us any differently than you
3 would any other boat,
and we litigated the matter. And we
4 concluded the
litigation. We entered into a stipulation
5 and that stipulation
clearly says that the cabinet, the
6 trustees, will not put
prohibitive language in re casino
7 boats in the lease and
we stipulated to that effect. So
8 all I would request is
an expression from the trustees
9 that they intend to
live up to the stipulation that you
10 entered into.
11
CFO GALLAGHER: You want to mention that, Colleen,
12 you guys were on our
side of this litigation?
13
MS. CASTILLE: We absolutely were.
14
CFO GALLAGHER: And we made that stipulation?
15
MS. CASTILLE: We did make that stipulation, that we
16 would only look at it
on a case-by-case basis is how we
17 interpreted that
stipulation. Mr. Haben interprets it
18 just slightly
differently.
19
CFO GALLAGHER: Can you sort of read that part of it
20 so we can hear that,
Colleen?
21
MS. CASTILLE: It is in the stipulation that the
22 challenge statement
constitutes a rule that was not
23 adopted under and
therefore violates Section 120.54,
24 Florida Statutes, and
the trustees shall immediately
25 discontinue all
reliance upon the statement or
any
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1 substantially similar
statement as a basis for Agency
2 action.
3
And then it retains jurisdiction for further
4 proceedings. And
the statement was a prohibition against
5 casino tour boats.
6
THE GOVERNOR: So the way I read that, and I'm
7 certainly no lawyer,
everybody knows that. But the way I
8 read that is we cannot
restrict, based on the statute, we
9 cannot restrict the
use in a sovereign submerged land --
10
CFO GALLAGHER: Right. We lease it --
11
THE GOVERNOR: Now can we restrict the use related to
12 other considerations
on a case-by-case basis? For
13 example, the term of
the lease? Does this stipulation
14 agreement have any
impact on that? Or if there is
15 pollution or if, you
know, they're in a manatee protection
16 zone or whatever
issue may come forward. You said on
17 Item 2 there was none
of those or they were very minor
18 issues.
19
MS. CASTILLE: That's correct. And so the question
20 is --
21
THE GOVERNOR: That is correct meaning? That was a
22 question. It
wasn't a statement.
23
(Laughter.)
24
CFO GALLAGHER: He knows the question is correct.
25 What's the
answer?
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1
(Laughter.)
2
MS. CASTILLE: The answer to the question is, Yes, we
3 believe that you can
modify the lease, individual leases,
4 on a case-by-case
basis based on a number of things. You
5 can modify the term of
the lease. You can modify the area
6 to be used. You
can modify other special lease conditions
7 for protection of
environmental resources in the area.
8 There are -- any
consideration. Our Attorney General's
9 attorney is saying any
consideration other than the use of
10 the boat.
11
CFO GALLAGHER: So I gather that you are looking
12 at -- let's talk
about Item 2. You've recommended
13 approval because
that's sort of what we have to do,
14 considering all the
other stuff, we can't --
15
MS. CASTILLE: Yes, sir, exactly.
16
THE GOVERNOR: But if we wanted to -- here's a legal
17 question. It's
a question too, not a statement. If we
18 wanted to shorten the
term of the lease because we have
19 that authority to do
it, because conditions are changing
20 in the gambling
market in our state --
21
CFO GALLAGHER: I think you can do it but not because
22 of gambling.
23
THE GOVERNOR: I mean, can we just do it? We're not
24 restricting the use,
we're only restricting the term of
25 the lease. I
thought I'd get you back up
here.
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1
(Laugher.)
2
CFO GALLAGHER: How come you didn't get a seat closer
3 to the microphone?
4
MR. HABEN: I think the best answer is probably the
5 question that Deanna
asked in the aides' meeting and she
6 said, Mr. Haben, you
are not maintaining that we cannot
7 enforce the
environmental laws of Florida? And my
8 response was, Not only
is that your right, that's your
9 responsibility.
Let me tell you what, in my opinion, you
10 cannot do.
11
You cannot say, This is a gaming boat, so I'm going
12 to shorten the lease
over here because that will get rid
13 of them. You
can't say, This is a gaming boat --
14
THE GOVERNOR: Well, it won't get rid of them, Ralph.
15 Why would it get rid
of them just to have a shorter term
16 lease? Just
changing conditions and life is changing,
17 there's going to be
all sorts of gambling things on the
18 ballot.
There's, you know -- why should we -- assuming we
19 would have the right
to restrict leases, we do it all the
20 time for the, you
know, these different uses. We can be
21 even arbitrary about
it, why not? We're not restricting
22 your ability to
gamble.
23
MR. HABEN: I do not think you can be arbitrary with
24 it. Here's the
question. If you look at that
25 stipulation, this is
what it means to me. You must
treat
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1 a boat that engages in
gaming the way you would treat
2 every other boat in
Florida that is in that category.
3 That means I don't
think you can say, Okay, because it's a
4 gaming ship, you're
only going to get a year's lease. And
5 let me comment on that
for just a second.
6
If you tell that to a lessee, I will tell you, that
7 if there is only a
possibility of a one-year renewal,
8 eventually the boat
owner will not go there. They spend
9 too much money.
And if they can't have any kind of
10 consistency in where
they are, they won't go to that
11 location. And I
just don't think -- the real question is
12 simple. You
can't treat, in my opinion, based on the
13 stipulation and the
law, you can't treat us any
14 differently because
of the rules and because I also think
15 it's a constitutional
violation of equal protection of the
16 law. So all
we're saying is, Treat us as you would every
17 other entity in this
state as it relates to sovereign
18 submerged land leases
because that's what the law is.
19
THE GOVERNOR: Thank you. You may want to -- there's
20 a seat right next to
Mr. Fineout that you may want to sit
21 in in case we --
well, at least as it relates to Item 2,
22 is it?
23
MS. CASTILLE: As it relates to Item 2.
24
THE GOVERNOR: Were there minor violations on the
25 lease, not
significant? Didn't sound like
--
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1
MS. CASTILLE: Right.
2
THE GOVERNOR: And, at least from my perspective,
3 without taking away
potential actions in the future,
4 because I'm not sure
that Mr. Haben is correct on that,
5 but he might be.
And we have the authority to act on our
6 authority and we may
not do it today but that doesn't mean
7 we're giving up that
right in the future. I would be
8 supportive of
approving this first one.
9
CFO GALLAGHER: Move Item 2.
10
GENERAL CRIST: Second.
11
THE GOVERNOR: There's a motion and a second. Any
12 other
discussion? Without objection, the lease is
13 approved.
14
Item 3. Let's use the same template here for
15 purposes of
discussion unless there is someone that wants
16 to speak on Item
--
17
CFO GALLAGHER: I think there is somebody that wants
18 to speak on Item
3.
19
THE GOVERNOR: Item 3?
20
MS. CASTILLE: Is there anyone else here?
21
THE GOVERNOR: Colleen, what about the experience on
22 this lease?
23
MS. CASTILLE: Item 3 is there were some minor
24 violations. In
early '89, the facility had no
25 authorization.
But with the payment of fines and
lease
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1 fees in arrears
through 1997, a temporary use agreement
2 was entered into with
the applicant and additional docks
3 were then constructed
without authorization but they were
4 assessed through 1997
when that TUA was issued. And --
5
THE GOVERNOR: They built a dock without
6 authorization?
7
MS. CASTILLE: Yes, sir.
8
CFO GALLAGHER: Things happen.
9
MS. CASTILLE: That actually happens much too
10 frequently.
11
THE GOVERNOR: You condone that?
12
MS. CASTILLE: No, sir.
13
CFO GALLAGHER: They bust them every chance they get.
14
THE GOVERNOR: But you took action?
15
MS. CASTILLE: We took action. They paid lease fees
16 in arrears and
fines. And then derelict vessels were
17 discovered along with
the additional alterations that were
18 made to the
structures. The applicant removed the
19 derelict vessels and
provided drawings and an up-to-date
20 file reflecting the
alterations. The applicant is in
21 current compliance
with the lease agreement as of
22 July 22nd, 2004.
23
CFO GALLAGHER: Mr. Haben, is this your client that
24 did this, built
this?
25
MR. HABEN:
Correct.
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1
CFO GALLAGHER: With your good guidance, why didn't
2 they know they had to
get approval to build a dock? You
3 better get to the
microphone. We'd like everybody to hear
4 your answer.
5
(Laughter.)
6
MR. HABEN: He should have called 850-545-6401 about
7 six months ahead of
time. But since he called me only
8 about three weeks ago,
this is the best I can do.
9
(Laughter.)
10
CFO GALLAGHER: I noticed everybody writing that
11 number down. I
don't know why, but they are waiting to
12 see the outcome.
13
MS. CASTILLE: So, again, this is a five-year lease,
14 sovereignty submerged
land lease and we are recommending
15 approval.
16
CFO GALLAGHER: Motion on 3.
17
GENERAL CRIST: Second.
18
THE GOVERNOR: Motion and second. Any other
19 discussion?
Without objection, the item passes.
20
MS. CASTILLE: Item 4 is a sovereignty submerged land
21 lease for Ms. Becky's
Seafood and we are removing the
22 lease condition again
on the prohibition of tour/casino
23 boats and including
an additional 2000 feet of sovereignty
24 submerged land which
will raise the preempted area to
25 72,000 square
feet. This is one that we had an issue
of
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1 industrial wastewater
disposal from a shrimp boat
2 operation where the
ice from the shrimp boat was disposed
3 of in the lagoon area
of the marina facility.
4
It is filled with leftover shrimp parts essentially
5 which become nutrients
in the water and created a little
6 bit of a dissolved
oxygen problem in the lagoon. The
7 applicant has agreed
to -- and it's approximately
8 52,000 gallons of
water on an annual basis that is
9 typically dumped
there.
10
The applicant has agreed to hook up to a waste -- a
11 central wastewater
treatment line in the area and to
12 prohibit that
disposal.
13
THE GOVERNOR: Okay. Let's ask this question. Oh,
14 I'm sorry, if you'll
go ahead and finish and then --
15
MS. CASTILLE: This is, again, the applicant -- let
16 me see. The
concerns were expressed about the applicant's
17 noncompliance on
those issues on water quality. But we
18 believe that we are
in a good situation with this
19 applicant in order to
get them under a lease. However, we
20 are recommending only
a one-year lease at this point in
21 time because we'd
like to make sure that the construction
22 of the sewer hookup
occurs and that operations are
23 maintained as
promised.
24
THE GOVERNOR: So what is the policy, the broad
25 policy, not
specifically related to any particular use
on
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1 sovereign submerged
lands. It seems like you've given
2 examples where
violations have occurred in the lease, but
3 your policy is to
allow for the lessees to clean up their
4 act rather than to not
renew their lease?
5
MS. CASTILLE: For the most part, when we have
6 applicants that are
dealing with us in good faith and
7 attempting to get
under lease and to become compliant with
8 applicable rules and
regulations, yes, sir, we do
9 recommend getting them
under lease.
10
THE GOVERNOR: Have we denied leases be based on
11 noncompliance with
the lease?
12
MS. CASTILLE: I recall as a cabinet aide that we
13 attempted to deny a
lease one time for a significant
14 mooring company in
the St. Johns River. And we also tried
15 to deny a lease to an
applicant who had nonwater dependent
16 uses in one of the
Charlotte, Lee, Manatee County areas.
17 We -- generally, when
the Agency comes up to deny leases,
18 the governor and
cabinet ultimately come to some solution
19 adding special lease
conditions to the leases which is
20 what we've done in
the most part. I don't know of any
21 leases that we've
denied.
22
THE GOVERNOR: Can I ask your counsel if legally we
23 would have the
ability to not renew this lease based on
24 noncompliance with
the conditions of the lease, not
25 related to its use,
but noncompliance with the
generic
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1 elements of our
typical sovereign submerged land leases.
2
MR. VIELHAUER: I think you have that authority to do
3 that based on
noncompliance of the lease. If you have
4 someone who has a
history of noncompliance, that is within
5 your proprietary
authority.
6
THE GOVERNOR: Thank you. Yes, General?
7
GENERAL CRIST: Colleen? Colleen, as to Item 4, are
8 they -- you mentioned
that there were some noncompliance
9 issues before.
Are they compliant today?
10
MS. CASTILLE: They have agreed to compliance on the
11 wastewater system,
hooking up to the wastewater system.
12
THE GOVERNOR: But they're still dumping this stuff
13 in the water right
now?
14
MS. CASTILLE: I don't know what they are doing with
15 it. What are
they doing? Are you the client? We have --
16 their attorney, Eric
Hearn, is here.
17
MR. HEARN: With respect to the industrial
18 wastewater, actually,
as we sit here today, we received a
19 letter from the
Department of Environmental Protection
20 yesterday to advise
us that the Department is not
21 requiring any action
on our part with respect to the
22 industrial wastewater
discharge issue. I have a copy of
23 that letter
here. I don't know if that's a way to --
24
THE GOVERNOR: Yeah, that's kind of new information
25 here. I thought
you just said that we
were?
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1
COMMISSIONER BRONSON: Governor, could I interject
2 here? Did I not
hear from my staff that should this
3 continue over a long
period of time, the oxygen depletion
4 and so forth will take
place. The actual, as it's
5 happening now, is
considered to be low enough that that
6 has not occurred but
could occur later should they keep
7 continually having
this ice flow and these nutrients
8 dumped into the
water.
9
So the point is eventually over time it will happen,
10 it's just not
happening right now, today, to the extent of
11 severe detriment to
the sea life that's in that bay; is
12 that correct?
13
MR. HEARN: Well, to address that issue specifically,
14 my client is
voluntarily going to go forward with
15 implementing the fix
that had been discussed between the
16 Department's
investigator and a representative of my
17 client. So
notwithstanding the fact that the Department
18 has decided not to
take enforcement action on this issue,
19 my client is going to
spend the money necessary to have
20 the discharged waters
discharged into the sewer system
21 rather than into the
marina basin.
22
CFO GALLAGHER: But the issue, I think, is this.
23 It's prohibited
practice. So whether or not the water is
24 ruined or not, hadn't
happened yet, should be immaterial.
25 The idea is you don't
pump it in there. So therefore --
I
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1 mean, just because you
did it a little bit and it didn't
2 hurt anything yet,
doesn't mean it should be okay.
3
COMMISSIONER BRONSON: Governor, if I can --
4
THE GOVERNOR: Sure, Commissioner.
5
COMMISSIONER BRONSON: I want to be -- I want to do
6 the right thing for
the resources, but I want us to be
7 very careful about how
we're looking at this right now
8 since the applicant
has agreed to go through the process
9 of putting in a
facility that will take care of this
10 problem simply
because if we go back to every docking area
11 in the state, which
we all know the State of Florida and
12 The Board of Trustees
is in charge of those lease lands
13 that all of those
facilities are on in the state of
14 Florida and every
commercial shrimping boat and everybody
15 else that comes to
these areas, we need to be very careful
16 about how we go about
this process as long as they are
17 meeting their
obligations not to pollute.
18
Because if you were to deny on this issue, then I
19 will guarantee you,
there will be about 200 people up here
20 complaining because
now they are going to be supposedly
21 charged with residues
in this water area on all of these
22 ships that are
operating in the state of Florida. I want
23 to make sure that we
don't throw the baby out with the
24 bathwater here, that
we take care of the problem. But
25 yet, we're not
opening the door for some bigger
problems
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1 in the state of
Florida.
2
THE GOVERNOR: Yes, General?
3
GENERAL CRIST: You said you had a letter from DEP?
4
MR. HEARN: I do, sir.
5
MS. CASTILLE: Could I address that, please?
6
GENERAL CRIST: Sure.
7
MS. CASTILLE: After negotiating with the applicant
8 to hook up to their
wastewater treatment system, the staff
9 sent a letter to them
saying that we were not going to
10 take any action on
the transgressions here with the rules.
11
THE GOVERNOR: So they volunteered?
12
MS. CASTILLE: They volunteered what?
13
THE GOVERNOR: They volunteered to do the wastewater
14 treatment
facility?
15
MS. CASTILLE: Yes, they did.
16
THE GOVERNOR: With quotes?
17
MS. CASTILLE: Uh-huh.
18
CFO GALLAGHER: What do you have to wait until the
19 ice melts to put it
in a wastewater treatment? I mean,
20 it's hard to dump ice
into it.
21
MS. CASTILLE: I'm not sure what the facility is
22 going to look like
that they're putting in.
23
MR. HEARN: My understanding is that it's just simply
24 going to be to
install plumbing to have the melting ice
25 water discharged into
the sewer system, that there's
not
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1 going to require any
type of treatment facility or other
2 facility to address
the issue. It's just simply a matter
3 of proper disposal, if
you'll call it that.
4
And on the issue of what position the Department has
5 taken on this issue, I
mean, the letter reflects that the
6 Department's position
is that there are no outstanding
7 industrial wastewater
issues at this time. I don't know
8 if that addresses any
of the issues that we're talking
9 about here, but it
seems to be that the folks that are
10 looking at this are
saying this is not a violation, that
11 this is not an
issue.
12
CFO GALLAGHER: Well --
13
MS. CASTILLE: Mr. Hearn, that's a misinterpretation
14 of the letter.
The person who wrote the letter was
15 working on the issue
with the applicant and the applicants
16 had agreed to put in
-- to connect to the wastewater
17 treatment system in
the community and therefore we have
18 determined that we
are not taking action on the issue
19 because they are
going to do -- because they are going to
20 hook up.
21
THE GOVERNOR: Okay. Any other questions?
22
CFO GALLAGHER: Because of all this, I'm going to
23 recommend a motion
that is for a one-year lease and a
24 renewal subject to
the special lease conditions and the
25 lease fee
payment. We'll make sure everybody is
doing
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1 what they said they
were going to do.
2
THE GOVERNOR: And the lease will contain the
3 modification.
4
CFO GALLAGHER: Yes.
5
THE GOVERNOR: The elimination of -- it will fulfill
6 the spirit of the
stipulation agreement.
7
CFO GALLAGHER: Yes.
8
THE GOVERNOR: That's your recommendation, isn't it?
9
MS. CASTILLE: Yes, sir, that is my recommendation.
10
GENERAL CRIST: Second.
11
THE GOVERNOR: There's a motion and a second. Any
12 other
discussion? All in favor say aye.
13
(Aye.)
14
THE GOVERNOR: All opposed.
15
(No response.)
16
THE GOVERNOR: Thank you very much.
17
MS. CASTILLE: Item 5 is a consideration of an
18 exchange agreement
with Mr. Terrance Fregly and his
19 company on two
parcels of nonconservation land totalling
20 .24 acres in exchange
for two parcels totalling an equal
21 size. All of
the properties are in downtown Tallahassee,
22 just south of the
Collins Building.
23
The value of the land that the Board of Trustees is
24 receiving is greater
than the value of the one that it
25 will be creating -- I
mean, that it will be conveying
by
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1 $8400. This
allows for consolidation of the property
2 which would make, in
the event of future surplussing, the
3 land more
valuable.
4
CFO GALLAGHER: Colleen, who's the private here, that
5 owner?
6
MS. CASTILLE: James Mann -- sorry, Mayor. James
7 Mayor.
8
CFO GALLAGHER: I think what you got here is half a
9 loaf in my
opinion. You know, what you end up with is --
10 I mean, I think we
ought to end up with a whole pie here,
11 you know, half and
half. Now here's what I see as a bit
12 of a problem.
We only have a small piece up there at the
13 top. And we own
a large piece on the hill. And I don't
14 know if you looked at
it, that's a pretty well -- that's a
15 big hill, a big
degree hill there.
16
If we're going to be doing something with this I
17 don't know why we
wouldn't end up with the whole hill, you
18 know, in other words,
take the line across and end up --
19 have Fregly go ahead
and get that private thing and end up
20 trading that with us
for his other piece over here so that
21 we'd end up owning
the one on that side. And if I was
22 him, I'd rather own
the other side.
23
MS. CASTILLE: Well, Treasurer Gallagher, I'm not
24 sure that this is
going to be a piece of property that
25 we're going to
ultimately want to keep in
total.
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1
THE GOVERNOR: It still would be easier to resell
2 if -- Commissioner is
saying if you had a block of
3 property that had two
owners with similar size properties,
4 it would be easier to
dispose of it as well, right?
5
MS. CASTILLE: It would be, yes.
6
CFO GALLAGHER: Well, that's what I'm looking at.
7 I'm not comfortable
doing this. I think Mr. Fregly needs
8 to go the next step
and go consolidate with Mr. Private
9 here.
10
THE GOVERNOR: Do we know Mr. Private? Does he want
11 to sell?
12
CFO GALLAGHER: I don't know if anybody has talked to
13 him.
14
THE GOVERNOR: Is anybody here that's been handling
15 this transaction?
16
CFO GALLAGHER: Well, Ron Richman looks like he's
17 named as a --
18
MS. CASTILLE: Who is?
19
THE GOVERNOR: Do you represent Mr. Private or Mr.
20 Fregly?
21
MR. RICHMOND: I represent Mr. Fregly.
22
THE GOVERNOR: You want to come -- maybe you could
23 give us a --
24
MR. RICHMOND: Ron Richmond representing Terry
25 Fregly. In all
honesty, I thought this whole thing
would
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1 make a lot of
sense. It squares off both pieces of
2 property and gives you
all your property together. It
3 gives us ability to
have property next to a building that
4 we own and be able to
utilize it for parking. That's all.
5 I mean, it's just a
squaring up of each other's property.
6 And if you're going to
sell some of these properties
7 downtown, you want it
squared up.
8
CFO GALLAGHER: I think it's good for everybody.
9
MR. RICHMOND: If you're interested in selling all
10 this, I'll go back to
my client.
11
(Laughter.)
12
CFO GALLAGHER: Well, here's the thing, I'm not sure
13 we want to even do
this yet because there's -- coming in
14 front of the cabinet
in a month or two is: What do we do
15 with all the land
that's not having any tax paid on it
16 that's sitting around
and we're probably not going to use.
17
MR. RICHMOND: And what I'm saying is, Mr. Gallagher,
18 is this squares up
your property and it squares up our
19 property.
That's all this is doing.
20
CFO GALLAGHER: Doesn't get square enough as far as
21 I'm concerned.
22
MR. RICHMOND: Whatever.
23
CFO GALLAGHER: Here we are with -- this is a typical
24 deal. We bought
this in 1970, now we're trading it out.
25 Next thing we're
going to be selling it and then,
you
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1 know, 20 years down
the road we'll be buying it back --
2
THE GOVERNOR: No, we're not going to be buying it
3 back.
4
CFO GALLAGHER: -- for three times as much as we're
5 selling it for.
We just seem to keep going around in
6 circles on that
stuff. Just for me, I think we're about
7 three quarters of the
way to where we need to be if we're
8 going to square it
off.
9
MS. CASTILLE: Treasurer Gallagher, in this piece of
10 property, this is --
I know you've been down there because
11 it's near one of your
buildings down there. On the
12 private piece of
property, there is an old house there and
13 it is currently being
leased out for small businesses.
14 What I anticipate
will happen, because I'm sort of seeing
15 and we have Mr. Simon
from DMS who's going to come and
16 give you an overview
of the real estate transactions that
17 we're looking at in
the future.
18
But I anticipate that this is not something that we
19 will want to
keep. For us to square up our piece of
20 property here, would
make it more valuable when we do
21 ultimately surplus
this piece of property. And it would
22 make it more valuable
for Mr. Fregly who, if he wants to
23 own that whole block,
will want to buy from us. And I
24 anticipate that in an
auction process that we will be able
25 to get back much more
than we've paid on this piece
of
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1 property.
2
THE GOVERNOR: Any other discussion? All in favor of
3 the motion signify by
saying aye.
4
(Aye.)
5
THE GOVERNOR: All opposed?
6
CFO GALLAGHER: No.
7
THE GOVERNOR: Commissioner, did you vote?
8
COMMISSIONER BRONSON: I'm still considering what
9 really should be
--
10
THE GOVERNOR: You got ten seconds.
11
(Laughter.)
12
THE GOVERNOR: No, take your time.
13
COMMISSIONER BRONSON: Have we got music with this or
14 what?
15
THE GOVERNOR: Just to let you know, it requires
16 three votes.
17
COMMISSIONER BRONSON: I think I'm going to go ahead
18 and vote to
exchange.
19
THE GOVERNOR: Thank you, sir.
20
MS. CASTILLE: Why do we need clarification on the
21 motion?
22
THE GOVERNOR: I think it passed.
23
MS. CASTILLE: It was moved --
24
THE GOVERNOR: Treasurer Gallagher --
25
MS. CASTILLE: It was not
moved.
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1
THE GOVERNOR: Oh, it wasn't moved?
2
GENERAL CRIST: Motion.
3
THE GOVERNOR: Is there a second?
4
COMMISSIONER BRONSON: Second.
5
THE GOVERNOR: All in favor signify by saying aye.
6
(Aye.)
7
THE GOVERNOR: All opposed.
8
CFO GALLAGHER: Aye.
9
THE GOVERNOR: Motion passes three to one.
10
Excuse me, I didn't do that right.
11
MS. CASTILLE: Item 6. This is yet, again, another
12 exchange. This
is consideration of a 2.2-acre parcel of
13 state-owned land that
we are determining is no longer
14 needed for
conservation purposes. It's an exchange
15 agreement with St.
Joe Timberland. This is adjacent to
16 Pine Log State Forest
in Bay County. The exchange
17 agreement under which
BOT would convey these parcels in
18 exchange for a
4.4-acre parcel that will be included in
19 the Pine Log State
Forest, the State nets $3,600 in value,
20 in value of land and
St. Joe is the exchange partner.
21
The reason why we are doing this is because of a road
22 that was a dirt road
and it was ultimately paved by the
23 County, which what we
try and do is square up those
24 parcels of property
again.
25
CFO GALLAGHER: On the two sides of the road?
Is
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1 this what this --
2
MS. CASTILLE: Yes, sir, it was on two sides of the
3 road and will --
4
CFO GALLAGHER: Our side and their side type --
5
MS. CASTILLE: Yes, sir.
6
CFO GALLAGHER: Motion.
7
COMMISSIONER BRONSON: Second.
8
THE GOVERNOR: There's a motion and a second.
9 Without objection, the
item passes.
10
MS. CASTILLE: Item 7 is the determination of a
11 4.35-acre parcel is
no longer needed for conservation
12 purposes. This
is a property for the Highway Safety and
13 Motor Vehicles
driver's license office. This is the
14 second busiest office
in the state. What is recommended
15 here is there is a
building on a piece of property that is
16 desired by Mr. Castro
who owns a mall across the street.
17 He would like to take
this building and exchange it for a
18 parcel of property
that he is -- that he has bought and
19 will build another
facility on.
20
Where's Highway Safety? And Fred Dickinson is here.
21 If you have any
questions, it's a value for value exchange
22 plus an additional
$30,000 to benefit the State. This has
23 also been a project
that has been approved by the
24 Legislature as
well.
25
COMMISSIONER BRONSON: Motion on
7.
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1
CFO GALLAGHER: Second.
2
THE GOVERNOR: There's a motion and a second, any
3 discussion?
Without objection, the item passes.
4
MS. CASTILLE: Item 8.
5
THE GOVERNOR: This is what people are here for.
6
MS. CASTILLE: This is what people are here for.
7
THE GOVERNOR: It just dawned on me.
8
MS. CASTILLE: Item 8 is a determination of an
9 exchange. This
is in connection with the Mecca piece of
10 property on which to
locate the Scripps biomedical
11 facility in Palm
Beach County. Governor, members of the
12 cabinet, I want to
let you know that this is on J.W.
13 Corbett Wildlife
Management Area which is to the west of
14 the Mecca site.
The -- this is not the first time that we
15 have done something
like this for J.W. Corbett.
16
A few years ago, there was a need for power line
17 corridor through the
J.W. Corbett Wildlife Management
18 Area. The J.W.
Corbett Wildlife management area, it was
19 acquired through
grants from the federal government, the
20 U.S. Fish and
Wildlife Service. And as such, it was
21 required to be held
in ownership by the Florida Fish and
22 Wildlife Conservation
Commission as well. So we have had
23 to go through, for
this surplus determination, we've had
24 to go through the
Fish and Wildlife Conservation
25 Commission, the
Southwest Florida Water
Management
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1 District, as well as
the Acquisition and Restoration
2 Council.
3
What we're doing is taking a 29-acre parcel of land
4 and surplussing
it. It is at the right-hand corner of
5 J.W. Corbett.
And we're going to be surplussing that for
6 the placement of a
canal for -- a flowage easement for a
7 canal that will
connect to the Loxahatchee Refuge
8 Restoration Project, a
FPL substation, and the expansion
9 of Seminole Pratt
Whitney Parkway.
10
In the prior surplussing agreement, on the power
11 line, what ultimately
occurred is there was a five-to-one
12 mitigation
determination for those lands. So for every
13 one acre that the
power line utilized, 5 acres were bought
14 for -- in return and
put in the J.W. Corbett Wildlife
15 Center management
area. In this case, we are doing the
16 proprietary usage
only. There are still two processes to
17 go through for
permitting. And so we are getting
18 mitigation acreage
for not only the proprietary uses, but
19 the permitting usage
as well.
20
So we are anticipating that we will have the same
21 type of -- same level
of mitigation, a five-to-one
22 mitigation.
This is a two-for-one mitigation. For this
23 30 acres, we will be
getting 60 acres of adjacent land
24 that will be added to
the wildlife Corbett center. The
25 Fish and Wildlife
Conservation Commission staff has
gone
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1 out and looked at that
60 acres. They believe that it is
2 equal to or greater
than the environmental resources that
3 will be used in this
30-acre parcel here, this 29-acre
4 parcel.
5
The Acquisition and Restoration Council -- the Fish
6 and Wildlife
Conservation Commission approved it. The
7 Acquisition and
Restoration Council approved it on a
8 six-to-one vote.
Hillary Swain from Archbold Center was
9 the one who was voting
against it. We looked at all of
10 the issues. We
do realize that with the addition of the
11 Palm Beach aggregates
and this flowage easement, we will
12 have all that we need
for Everglades restoration in this
13 area.
14
THE GOVERNOR: Do we have some speakers?
15
MS. CASTILLE: We do have some speakers, sir.
16
THE GOVERNOR: How many?
17
MS. CASTILLE: We have the Nature Conservancy. We
18 have five
speakers.
19
THE GOVERNOR: Okay.
20
MS. GENGENBACH: Good morning, Governor, members.
21 Marianne Gengenbach
with the Nature Conservancy. I don't
22 think anybody here
wants to refute the fact that the
23 Scripps project
represents an unprecedented opportunity
24 for the State.
We commend you, Governor, and the other
25 folks who've worked
very hard to bring them here.
That
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1 having been said, the
Nature Conservancy does have some
2 strong concerns about
this particular exchange and I would
3 say that most of those
concerns are wrapped up in the
4 rather expedited
process that's been used to arrive at
5 this proposal that's
before you today.
6
We're dealing here with conservation land that this
7 state as a whole has a
constitutional mandate to protect
8 in perpetuity and it
needs to dispose of it only when it's
9 no longer needed for
conservation. The statute being what
10 it is about Corbett
basically puts you-all in the position
11 of approving a
surplussing issue that's already been
12 decided by the Fish
and Wildlife Conservation Commission
13 in this regard.
14
Now, I know that the Fish and Wildlife Conservation
15 Commission has done a
remarkable job negotiating this
16 under, you know,
tremendous time pressure and they've
17 worked very hard to
get a good solution for the State.
18 But the expedited
process and time pressure means that
19 much information that
might ordinarily have been requested
20 or required to make
the best possible decision for the
21 interest of the State
with respect to conservation lands
22 and natural resources
haven't been answered.
23
There has not been, for example, an actual
24 environmental
resource inventory on the parcels in
25 question. A
question came up at the ARC meeting the
other
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1 day, a natural
resource inventory, excuse me. There has
2 been some assessment,
but it had to do with minerals and
3 that sort of
thing. But there has not been an EPNA
4 analysis of the
natural resources present on the land.
5
There has not been or there was not available any
6 scientific information
on alternate sites that might have
7 been considered for
this exchange. I'm not talking about
8 for Scripps, but for
this exchange specifically. And the
9 ARC discussion raised
many of the same questions that I
10 and other speakers
are putting before you today and these
11 questions remain
unanswered as you consider this item. We
12 think that's
regrettable. Especially from a statewide
13 perspective we think
this is a precedent-setting decision.
14 That's because if
we're telling Palm Beach County that
15 it's okay, use the
State conservation lands in their
16 county as a pool or a
bank for potential future economic
17 development, we're
going to be facing that question with
18 66 other counties at
some point in the future and I'm
19 claiming to have the
answer. I think how we'll answer
20 that question is
going to be very complicated but it makes
21 it even more
important to use the highest level of
22 deliberation, the
highest level of stakeholder involvement
23 and the most complete
scientific information when we make
24 that kind of
important decision.
25
With the final citing of Scripps most recently
being
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1 called into question,
we believe that taking a little more
2 time to make this
decision with that high level of
3 deliberation in mind
could well be in the best interest of
4 the State's natural
resources and conservation lands.
5 Thank you.
6
THE GOVERNOR: Thank you very much. Colleen?
7
MS. CASTILLE: Yes, sir.
8
THE GOVERNOR: Can I ask you a question?
9
MS. CASTILLE: Yes, sir.
10
THE GOVERNOR: If Scripps decides not to go back on
11 the property, is this
subject to that happening?
12
MS. CASTILLE: Yes.
13
CFO GALLAGHER: It will be contingent on the
14 selection of Mecca
Farms, otherwise it gets undone or
15 doesn't actually
happen, one of the two.
16
MS. CASTILLE: Correct. It doesn't actually happen.
17
MR. PATTISON: Good morning, Governor. My name is
18 Charles
Pattison. I'm the executive director of 1000
19 Friends of
Florida. We extend our congratulations to you
20 and your leadership
in bringing Scripps to Florida and
21 Palm Beach County in
particular. We do have some concerns
22 though and we join
with other groups in expressing those
23 about the Mecca
site. Our big concern there is the swap
24 that's proposed
before you is what will enable the Mecca
25 development to
happen. I think you're aware too of
the
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1 proposed associated
development in Palm Beach Gardens next
2 door. The net
result of all of that is to have a
3 community larger than
downtown West Palm Beach right
4 beside the Corbett
wildlife management area.
5
And, of course, this is the same watershed area where
6 the Loxahatchee River
is nourished. That's, of course,
7 Florida's first and
one of only two federally designated
8 wild and scenic
rivers. We think those are reasons enough
9 for being concerned
about the site. The county
10 commission, as you're
aware, suggested two alternatives to
11 the Scripps that we
believe can more than meet their
12 needs. We also
understand that there are issues with
13 those sites
themselves. I think you've asked people to
14 consider giving
things up in order to bring this off. I
15 think the groups we
work with are willing to do that even
16 though there will be
issues as well with some of the other
17 sites.
18
I think though that you should, again, look at what
19 is being done in
order to try to accommodate the Scripps
20 project at the Mecca
Farms site. I would correct one
21 thing that's in your
staff report. At this point, DCA has
22 not granted final
approval for the project. In fact, they
23 raised concerns, as
did the Treasure Coast Regional
24 Planning Council
about the location and strongly suggested
25 that the County look
at more eastern sites. And,
of
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1 course, that's what
they've done with these two
2 alternatives.
3
I would echo too the praise for the County, the Game
4 Commission and your
staff and DEP as well, trying to make
5 this work. But
it looks to us like there are quite a few
6 things having to be
done in order to accommodate it and
7 I'd like to briefly
list those for you. There are quite a
8 few exceptions being
made to allow urban services to go
9 into an urban area to
service the project there. There
10 are alterations being
made to this nationally
11 award-winning land
use plan that try to accommodate urban
12 and rural development
in a growing county.
13
There are significant density changes that would not
14 only accommodate
development here but throughout Palm
15 Beach County.
There are major roadway projects, 45, in
16 fact, that wouldn't
be necessary in order to service this
17 site, 22 of which
would be at capacity before they -- or
18 as they were even
completed. And, of course, that's
19 associated with the
additional infrastructure costs beyond
20 the $510 million that
both the State and County have
21 already
committed. We see that number approaching -- or
22 somewhere between 250
and $500 million additionally.
23
Of course one last point was the whole concept that
24 we think we've
learned from in south Florida and that was
25 the eastward ho idea
that whatever else we do, we need
to
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1 take advantage of
opportunities to go further east, not
2 further west when we
do that.
3
You asked in particular about a little condition, a
4 reverter clause.
We would, of course, suggest that the
5 project or this
transfer not happen. But should it
6 happen, we believe
that reverter is very critical. The
7 last thing we would
like to see would be a swap at public
8 expense that would
enable more development to happen in
9 this very area even if
Mecca were located somewhere else.
10
Thank you for your time.
11
THE GOVERNOR: Thank you.
12
MR. FULLER: Governor --
13
THE GOVERNOR: General, or anybody here, if this was
14 just in the abstract
without any other consideration for
15 developments around
the property, getting a two-for-one
16 match or swap, in
essence, that's what this is, isn't it?
17 I mean, weren't we
talking about expanding the preserve
18 with the analysis
being that this property has greater
19 environmental
resource values than what was being given up
20 would be a pretty
good deal?
21
MR. FULLER: Generally speaking, yes, sir.
22
THE GOVERNOR: But your-all's concerns relate to the
23 broader issues of
development.
24
MR. FULLER: They do, yes, sir, but there is -- there
25 are some issues such
as
--
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1
THE GOVERNOR: Manley, I'm sorry. You may not have
2 said who you were.
3
MR. FULLER: Manley Fuller with the Florida Wildlife
4 Federation. Some
examples that we are concerned about,
5 precedent, we think
that, for instance, location of a
6 substation, that the
County could have located through
7 good planning a
substation on other properties. We don't
8 want to see a
precedent that facilities like substations
9 go in on conservation
land. So that's what I meant in
10 general, would agree
with your statement.
11
I represent Florida Wildlife Federation. We concur
12 with the two previous
speakers' comments and also -- and
13 also the comments
that Mr. Draper will make for Audubon
14 that will
follow. We want to compliment you, Governor,
15 for reaching out
across the country to major, a very
16 well-respected
institution in bringing them to Florida and
17 to Palm Beach
County. And so our concern about this site,
18 it's not about -- is
not about whether Scripps comes to
19 Palm Beach County or
not. We think that's a good idea and
20 compliment you for
it.
21
We think this is the wrong location. We think that
22 the infrastructure
associated with this development is
23 going to stimulate
urban sprawl and going to drive
24 development out in an
area of the county that doesn't
25 comply with the
previous -- with the Growth
Management
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1 plan for the
county. And we think there are viable
2 alternatives and we
would seriously like those to be
3 considered. And
we also think the reverter clause, if you
4 do move this item
forward, that the reverter clause is
5 absolutely necessary
because of the reasons that have
6 been -- you-all and
Mr. Pattison mentioned.
7
Thank you very much.
8
THE GOVERNOR: Thank you, Manley.
9
MR. DRAPER: Governor, members of the cabinet. Eric
10 Draper speaking today
on behalf of Audubon of Florida and
11 Audubon Society of
the Everglades which is our chapter in
12 Palm Beach County, an
independent organization that has
13 sent representatives
to speak before the Palm Beach County
14 Commission and the
South Florida Water Management District
15 on similar decisions
regarding this site. I commend you,
16 Governor, for
recruiting and locating Scripps Research
17 Institute in Palm
Beach County. It's a great
18 accomplishment to
diversify Florida's economy and we thank
19 you for your
leadership on that.
20
Now we've reviewed the proposed development plans to
21 the Mecca site and we
respectfully suggest that this is
22 the wrong location
for Scripps. Audubon supports Palm
23 Beach County's
decision that was made last week to ask
24 Scripps to consider
alternative sites and that was well
25 reported and we've
joined other organizations
in
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1 communicating with
Scripps Research Institute and asked
2 them to accept Palm
Beach County's recommendations, that
3 they look at these
alternative sites. That would be the
4 smart thing to do from
a development point of view and
5 would allow Scripps to
be located there.
6
After considerable investigation, we believe the
7 restoration of
Loxahatchee River would be best served by
8 increased use of the
Mecca site which has been considered
9 under Everglades
restoration plans for storing and moving
10 water. And the
current plan, which is a highly engineered
11 canal and flow-way
proposal within the development plan
12 itself, cannot be
shown right now to be sufficient to, for
13 the purpose of moving
water from the L-8 canal to the C-18
14 canal in order to get
enough water in the Loxahatchee
15 River to meet the
minimum flowing level which is required
16 there. You may
be aware that Loxahatchee River is
17 seriously compromised
by lack of freshwater flow right
18 now. Florida's
only wild and scenic river which has the
19 saltwater line has
moved 10 miles, up to the 10-mile point
20 from where it should
be at the 6-mile point, very, very
21 high restoration
priority.
22
Now, Governor, you asked the question when Manley got
23 up to speak about
whether we would otherwise support this
24 exchange. I
don't think that we would support this
25 exchange in another
situation. This is a situation
which
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1 you've gone, even on a
two-for-one exchange, the quality
2 of the exchange has
not been evaluated at all. You would
3 expect the Acquisition
Resource Council and even the
4 governor and cabinet
to insist on having the kind of
5 information that would
allow you to evaluate this on
6 something other than
just an acre-for-acre exchange. In
7 the same way that you
raise questions about the fiscal
8 value of land when you
exchange, you wouldn't exchange a
9 piece of land that was
worth $10,000 for 2 acres of land
10 that was worth
$2,000. I mean, you wouldn't justify that
11 as a two-for-one
exchange. I don't think that you've got
12 enough information to
justify on an ecological basis this
13 type of exchange
because you're carving into the existing
14 wildlife management
area even though you're making the
15 wildlife management
area whole in another part. That
16 piece of land that
you've added, there's some question
17 about whether or not
it has invasive, exotic species such
18 as Lygodium it.
19
I sent my members down in Palm Beach County out to
20 review the site that
you're getting ready to give up. We
21 believe it's a
quality pine flat woods and we would just
22 as soon not see that
taken out of the corporate wildlife
23 management area, an
area that our members use for bird
24 watching which host
red-cockaded woodpeckers although not
25 on this particular
site.
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1
I know that your staff have come up with a way to
2 justify this
exchange. We've been through this debate a
3 couple of times
already. But even if the lands were of
4 equal value, and that
hasn't been demonstrated, the
5 proposed corporate
land exchange is still conservation
6 land. It's
needed for conservation purposes. That's what
7 the Constitution
refers to. And I think it would be a
8 mistake to give it up
in this situation.
9
I support what Marianne said earlier which is you're
10 inviting other
counties to go shopping for your lands.
11 You'll have other
decisions like this proposed for you
12 where there's an
economic argument in order to surplus
13 state lands.
Every one of them that they bring to you
14 will have a
compelling reason why you should do this. It
15 will always be
something very important in the economic
16 development of the
area will be very important.
17
Now, I hope that you will look at the growing chorus
18 of concern that's
been expressed in Palm Beach County and
19 other places for
locating the Scripps site off Mecca and
20 onto another
location. I think that definitely is the
21 trend of where people
are thinking down there and that's
22 certainly reflected
in that five-to-two vote at the Palm
23 Beach County
Commission. And I hope that by your decision
24 today or your
comments on your decision today that you'll
25 join the push to get
Mecca in a more appropriate part
of
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1 Palm Beach County.
2
THE GOVERNOR: Now, just for the record, Palm Beach
3 County didn't, by
voting 5-2, say Mecca was not an
4 appropriate site for
Scripps. They said there were other
5 options that, you
know, at least five of the members said
6 had benefits that
needed to be considered and might
7 outweigh the Mecca
property. They didn't vote to say,
8 We're taking Mecca off
the table.
9
MR. DRAPER: Governor, respectfully, the way that my
10 members and staff who
were there and listened to the
11 debate at Palm Beach
County looked at it and the way that
12 I would say reading a
number of newspaper accounts sure
13 seemed like the Palm
Beach County Commission was stepping
14 away from Mecca
--
15
THE GOVERNOR: Well, then they could have done it.
16 Then they would have
done it but they didn't.
17
MR. DRAPER: It's my understanding that the reason
18 they didn't do it is
because they're legally bound by the
19 contract to help with
the Scripps, to not back away from
20 the Mecca site.
And I think that that statement was made
21 before the
Acquisition Resource Council last week and also
22 before the cabinet
aides by representatives of the Palm
23 Beach County
Commission, that being the reason that they
24 couldn't step
directly away from the contract.
25
COMMISSIONER BRONSON: Governor, could I ask
a
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1 question on
this? I've been asking my staff some
2 additional questions
as well as what they remembered from
3 the staff
meeting. It's my understanding whether Scripps
4 is built on this
property or moved to another location,
5 the County has already
offered and will, under contract,
6 buy Mecca. And
it will be developed or something there
7 whether Scripps goes
there or not. So I'm not sure what
8 we're arguing here
yet.
9
I mean, we're talking about giving 2 acres of leases
10 for power lines and
so forth in exchange for 4.4 acres of
11 land that I have
already taken a look on the map and I can
12 see basically what's
there. And where its location is
13 would be a pretty
good swap for natural resource purposes
14 it seems to me.
If we're only giving up leases for power
15 lines and some other
things, I'm not sure that the
16 destruction that
we've heard is going to take place in any
17 major case.
18
I mean, the red-cockaded woodpeckers are still going
19 to be there even
though there will be power lines around
20 it, they still will
live there. And whatever the other
21 resources that are
there, I don't believe -- the loss will
22 be very minimal, if
any, just because they're putting some
23 holes in the ground
and some poles and some power lines
24 there.
25
MR. DRAPER: Commissioner Bronson, I would like
to
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1 respond just to what
you said. What was said on record by
2 Palm Beach County is
that if in fact Mecca is not used for
3 the Scripps site, that
they will retain the property but
4 they will give the
Water Management District whatever they
5 need of that property
to be used for Everglades
6 restoration to expand
the purposes of moving and flowing
7 water through the site
to help the Loxahatchee River and
8 then they would allow
very low intensity development on
9 whatever part of the
site the Water Management District
10 didn't need in order
to do Everglades restoration. So
11 it's not correct to
assume that this land will be
12 developed whether or
not Scripps goes on the Mecca
13 property.
14
COMMISSIONER BRONSON: But I understood too that this
15 water resource
situation may be done whether Scripps gets
16 it or not. They
still may be able to work out that same
17 issue on water
resource improvements for that area. So I
18 don't see where
you're losing anything there either.
19
THE GOVERNOR: Palm Beach County is legally
20 obligated. They
have a binding contract to buy the
21 property. And
their intent was either to sell off part of
22 that property to
provide the capital to meet their
23 commitments for the
construction of the building, whether
24 it's on this site or
the other two that they've
25 recommended.
And I don't think that's changed. And
if
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1 they are going to sell
it off, it's not for natural
2 resource
purposes. It's to build homes with some density
3 that would justify
that $60 million price, whatever it is.
4
MS. CASTILLE: Just to address the environmental
5 quality of the site to
be exchanged. This is part of the
6 expansion for the
optimal planning boundary for the
7 Corbett center, the
Corbett area, so that is part of what
8 Fish and Wildlife had
designed -- that's why we directed
9 them to that location
to include the optimum boundary
10 expansion.
11
THE GOVERNOR: Any other speakers?
12
CFO GALLAGHER: Governor, I'd like to move approval
13 contingent on the
section of Mecca Farms' site as a
14 location for the
Scripps research facility.
15
THE GOVERNOR: Is there a second?
16
COMMISSIONER BRONSON: Second.
17
THE GOVERNOR: Any other discussion? All in favor
18 say aye.
19
(Aye.)
20
THE GOVERNOR: All opposed.
21
(No response.)
22
THE GOVERNOR: I guess there are no more speakers.
23
MS. CASTILLE: No more speakers.
24
THE GOVERNOR: Item 9.
25
MS. CASTILLE: Item 9 is the consideration of
an
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1 option agreement with
Orange County to acquire 4.59 acres
2 within the Cady Way
Trail of the Florida Forever Project.
3 This is a recreational
trail in Orange County that
4 connects Orange,
Seminole, Lake, and Osceola Counties.
5 This is the eastern
side of the trail. What we're doing
6 here, the best way to
think of this acquisition -- the
7 best way to think of
this acquisition is very similar to a
8 Florida communities
trust project where the community goes
9 in and buys the
property first and then comes to us for a
10 grant to be refunded
those moneys which they generally
11 take and use for
operational.
12
THE GOVERNOR: You keep showing those same design
13 drawings for every
--
14
(Laughter.)
15
MS. CASTILLE: I'm just trying to put a vision in
16 people's minds for
what we like to see for public safety.
17
THE GOVERNOR: You know what it reminds me of? It
18 reminds me of George
Jetson and Spacely Sprockets. There
19 is no such
thing. This is all made up. You keep showing
20 it for every deal we
do.
21
(Laughter.)
22
MS. CASTILLE: I like to maximize our engineering
23 costs, sir. So
this item would be to acquire 4.5 -- 4.59
24 acres and lease it
back to Orange County.
25
THE GOVERNOR: So I'm a little confused. Who
owns
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1 the property?
2
MS. CASTILLE: Orange County has purchased the
3 property and we are
buying it back from them for --
4
THE GOVERNOR: So they advanced what we would have
5 done.
6
MS. CASTILLE: Yes. They would have applied --
7
THE GOVERNOR: Would we have paid that much money?
8
MS. CASTILLE: Well, they're actually selling it to
9 us at a 50,000-dollar
loss.
10
CFO GALLAGHER: Because they paid too much.
11
(Laugher.)
12
THE GOVERNOR: Exactly. That's kind of my question.
13 So we're relying on
someone else's appraisal.
14
MS. CASTILLE: Yes, sir.
15
THE GOVERNOR: And are we comfortable with the price?
16 Seems a little --
17
CFO GALLAGHER: We're paying 100 percent of the
18 appraisal price that
we got for our two appraisers.
19
THE GOVERNOR: That's why we paid the 50 -- they took
20 the 50,000-dollar
haircut?
21
CFO GALLAGHER: Yes. Motion on 9.
22
COMMISSIONER BRONSON: Second.
23
THE GOVERNOR: Just out of curiosity -- how much --
24 5 acres for --
25
CFO GALLAGHER: $93,000 an
acre.
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1
THE GOVERNOR: Two bucks a foot.
2
MS. CASTILLE: Remember, when we do these
3 acquisitions of linear
facilities, it doesn't really
4 equate to a good
acreage evaluation.
5
THE GOVERNOR: So will you buy it for linear feet?
6
(Laughter.)
7
THE GOVERNOR: We love our friends in Orange County.
8
MS. CASTILLE: Yes, we do.
9
THE GOVERNOR: Is there a motion?
10
CFO GALLAGHER: There is, and a second. Without
11 objection, the item
passes.
12
MS. CASTILLE: Okay. Item 10. Item 10 is
13 consideration of an
option agreement to acquire a
14 perpetual
conservation easement over 2124 acres in
15 Apalachicola
River. I believe that we would like to have
16 a discussion about
conservation easements in general at
17 this time.
18
CFO GALLAGHER: Yes, we would. Yes, we would. I
19 would. I don't
know about anybody else.
20
MS. CASTILLE: Over the last couple of cabinet
21 meetings, the
discussion of conservation easements and
22 their efficacy for
conservation lands has been an issue
23 that you-all have
brought up. I think the message that I
24 want to leave with
you is that we have bought -- we
25 started doing this
about significantly, I think,
when
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1 Governor Bush came on
board in 1994 -- 1999 --
2
THE GOVERNOR: I wasn't elected that year.
3
(Laughter.)
4
THE GOVERNOR: Came in second in a field a two.
5
GENERAL CRIST: Close second.
6
(Laughter.)
7
MS. CASTILLE: And so we started looking at
8 conservation easements
as a way to leverage our dollars
9 and we have
successfully leveraged those dollars. We
10 have, since that
time, bought, under conservation
11 easements, 142,000
acres at 55 percent of value. And what
12 that allows us to do,
we paid $134 million for those
13 conservation
easements. That allowed us to leverage
14 another $111 million
which could -- which more than likely
15 bought, if you look
at it on average, 50,000 -- more than
16 50,000 acres in fee
simple ownership. Or if we could have
17 taken those and used
it again for conservation easements,
18 we would have gotten
another 100,000 acres. So the
19 leverage that we have
been able to acquire with this type
20 of acquisition has
been tremendous, allowing us to buy
21 more than we
typically could if we just bought in fee
22 simple.
23
CFO GALLAGHER: Well, let me just say I'm not against
24 buying conservation
easements.
25
MS. CASTILLE: Yes,
sir.
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1
CFO GALLAGHER: I don't have any problem with that.
2 I think it's a
wonderful idea and everything else. My
3 problem is what do we
get for it and who ends up with the
4 residual. And
what -- I've been talking about it and I'm
5 going to continue is
that I've got a sort of breakdown
6 here, the standard
conservation easement document used by
7 DEP, and I'm basically
looking to change the way in which
8 we do it. And I
don't have any problem as the recitals
9 go, the duration of
the easement, the purpose of the
10 easement, the rights
granted under the grantee, prohibited
11 uses, grantor's
reserved rights, grantees' remedies, no
12 public access and
then miscellaneous in Article No. 8.
13
The key issue here is the sentence that says, Any
14 activity on or use of
the property not inconsistent with
15 the purpose of this
easement is permitted. And I would
16 like to see it be --
delete that. And in Article V put,
17 Any activity on or
the use of this property not identified
18 in Article V is
prohibited. And that sort of switches it
19 so that the person
who's receiving the cash on this has a
20 limited use of the
land because we bought the conservation
21 easement and we have
the whatever isn't mentioned.
22
Now I recognize there may be something that wasn't
23 thought about.
And there is always the opportunity for
24 someone to come and
say, Look, we'd like to plant one more
25 acre of corn because
deer like the corn. It will feed
the
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1 deer and there's more
deer now. And we'd have the choice
2 of saying, That's a
great idea. Go ahead and do it. And
3 so there could be,
obviously, a place in there where they
4 can come back any time
if there is something else they
5 want to get.
With or without a charge most likely, we'd
6 probably allow
something like that. That's my issue here.
7
THE GOVERNOR: Before the Commissioner speaks,
8 because I got a sense
he might. This is going to be a
9 good discussion
because I think this is work in progress.
10 And I support
Treasurer Gallagher's view on this, but I'd
11 like to know at some
point after Charlie speaks what are
12 the unintended
consequences of this idea because I
13 think -- I think
you're absolutely right. I mean, these
14 rights shouldn't be
open. We should be defining what
15 people have, what
rights they maintain when there is a
16 conservation
easement.
17
But are there logistical issues? Are there
18 consequences that we
have not thought out just in the
19 field on the ground
or as it relates to a farmer or
20 rancher why this
wouldn't work. Because this is how it's
21 done commercially all
the time, I think. You quantify the
22 rights that people
keep in return for, you know, the
23 purchase of an
easement. So, Commissioner?
24
COMMISSIONER BRONSON: Thank you, Governor. This is
25 an issue that covers
a lot of territory, actually. And
I
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1 remember back in my
early days in the senate all these
2 issues were boiling up
and there was a lot of discussion
3 on the easement
processes.
4
First of all, let's take into account, if you go to
5 the environmental
groups, and many that we heard from this
6 morning on another
issue, if we want to do conservation
7 easements in their
totality of why we're doing them to
8 save those open spaces
so that they're not developed, one
9 of the issues that I
know cattlemen across the state that
10 have been a big part
of this whose families are hoping to
11 keep this property
for a long time have gone into some of
12 these.
13
There were three or four issues involved very early
14 on that I noticed
could be a problem. Number one, it's
15 good for the
generation that has it now and wants to keep
16 it. But as the
heads of the family die over a period of
17 time, and the federal
government comes in and says, Give
18 me my 55 percent of
everything that your family owns,
19 which they do, who
pays that price in succeeding
20 generations and how
much is left to use? That's one
21 issue.
22
The other issue is if it is not written in the
23 contract by the State
that this is prohibited, it's almost
24 going back to another
issue that I fought very hard when I
25 got in the senate and
that was when you go to any
court
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1 of -- administrative
court, on a state agency's
2 presumption of
correctness. Just because a state agency
3 in their rule,
regulation and so forth has put something
4 into play, in my
opinion, does not mean that they're
5 necessarily
correct. It means you have a right to
6 challenge under 120
that presumption of correctness. And
7 I think some of the
courts upheld that the fact is that
8 the State should not
have the upper hand to come in with
9 presumption of
correctness. They should prove their
10 point.
11
This whole idea of conservation easements on one hand
12 is great. On
another hand, for those who are going to go
13 into that agreement
with the State have to be assured that
14 they can either,
through the next generation or so, make a
15 living on that
property if it is agricultural type lands
16 that we are talking
about.
17
If you put in there that anything that is not written
18 is prohibited unless
granted, then that means that those
19 farmers, those
ranchers and those people in silviculture
20 and other things have
to come back for every single issue
21 that they may have to
change depending on what the market
22 is, whether timber
goes to such a low value that timbering
23 is not an issue
anymore they've got to go to something
24 else or cattle may
not be a profitable issue, they must go
25 to sod or something
else. Then they've got to come
and
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1 fight for every single
issue if it's not listed in there
2 that they may have to
go through on a piece of land that
3 them or their family
members from a generation back put
4 under a perpetual
conservation easement. And I can tell
5 you that that type of
-- that type of situation on a
6 succeeding family
generation along with free trade issues,
7 Hurricane Charley and
however many hurricanes come after
8 this and all those
issues, is really sounding, and I heard
9 this in the very area
I was in yesterday, of whether some
10 of these people are
going to survive or not, the death
11 knell to agriculture
in some areas because now they've got
12 to pay a higher price
just to stay in business and whether
13 or not they can
recoup those losses or recoup that
14 business
interest.
15
So this is a very -- on one hand it sounds wonderful
16 but it's a very
complicated business issue. And if the
17 State takes the
position of being a presumptive
18 correctness of
anything you do other than what it says
19 here is not
prohibited, that puts a real burden on those
20 businesses to come
back and come to this cabinet and hire
21 the attorneys which
we all know are cheap and they work
22 for free in these
issues --
23
CFO GALLAGHER: Ralph Haben doesn't claim to work for
24 free.
25
COMMISSIONER BRONSON: It costs a lot of money
to
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1 come to this cabinet
and try to get an issue through. And
2 I just think we need
to be very careful here about how we
3 are going to adopt
this issue of conservation easements
4 and what we're doing
to those who may be thinking about
5 going into a
conservation easement but may turn around and
6 say, The heck with
this. There's no way I'm going there
7 now. We may be
taking more land off the potential for
8 conservation easements
by what we do here today or what we
9 do in the
future. Maybe not today, but we could be taking
10 more land off the
rolls for conservation easements not
11 adding more land to
it. So I think we need to be very
12 careful about what we
do here.
13
CFO GALLAGHER: Well, in answer to that, is nobody is
14 made to go into these
conservation agreements. It's done
15 voluntarily.
They get paid a lot of money for these and,
16 in my opinion, we
haven't gotten a lot. And, you know, if
17 they can switch to
any crop and grow anything they want, I
18 don't know why we
even have a conservation. What do we
19 buy? They can't
build a building --
20
THE GOVERNOR: Right. What we're buying is their
21 inability to develop
the property into single-family homes
22 which is a huge
--
23
CFO GALLAGHER: No, that's a big deal.
24
THE GOVERNOR: That's why we pay 60 percent of the
25 value because that
development, those
prospective
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1 development rights are
really the value. And my concern
2 relates to stuff like
drilling, mining, things that may
3 have -- we're buying
these properties or we're doing
4 through easements or
purchase because of their
5 environmental
advantage. We have a big extensive process
6 of identifying areas
in the state where that's the case.
7 So to have a
conservation easement and then somehow miss
8 uses that might do
harm to the environment is completely
9 counterproductive and
I think that's my --
10
COMMISSIONER BRONSON: But, Governor, that's not what
11 I'm saying. I
mean, almost every person I know of that
12 has gone into these
agreements knows good and well they
13 can't go in there
unless it's written in the agreement
14 that they can and I
don't think they write those
15 agreements, I haven't
seen them. That they can drill for
16 oil or go in there
and mine rock unless it was an
17 agreement that was an
old agreement --
18
CFO GALLAGHER: Somebody else already had.
19
COMMISSIONER BRONSON: -- somebody already had that
20 under some legal
obligation they had to give. But the
21 ones I've seen
currently do not offer those types of
22 opportunities.
But on the other hand, if you've got a big
23 ranch piece, let's
say, and a lot of these are big ranch
24 pieces that are going
into these, if you take my
25 ability -- let's say
I've got 3,000 acres that's not
under
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1 this agreement that is
actually in the middle of or next
2 to or whatever the
acreage that goes under this agreement,
3 and you start
affecting my ability to farm because it may
4 affect somehow or it
is thought to affect somehow the
5 conservation easement
that we have, then you've taken the
6 ability to keep
farming away from me while somebody argues
7 this out with the
cabinet. But my point is, and --
8
THE GOVERNOR: That's a good point.
9
COMMISSIONER BRONSON: -- you're right. Tom, you're
10 right about this
because I could either sign it or not
11 sign it. But if
I sign it under feeling that this
12 agreement is a good
agreement and somebody keeps trying to
13 change the rules as
we go along here or says that
14 automatically
anything that's not written down here is
15 illegal to do, then
you are really -- what you're going to
16 do is have people who
are maybe willing to do an
17 obligation to the
State not to build on that property to
18 say, That's it, I'm
not putting this up at all now, simply
19 because that ties
their hands so much that they'd be
20 foolish to sign a
document like that unless they just want
21 to give the land to
the State at some point in time.
22
And I think we need to be careful or we're not going
23 to get some
conservation easements we would like to have
24 as a state in those
green areas simply because this is
25 going to scare people
off of even contemplating
signing.
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1 And I know some people
right know because of some rules
2 that have gone on some
other conservation easements that
3 have already backed
out of doing an easement with the
4 State totally because
they're scared to death to do one
5 now. They're
afraid of what it's going to do to their
6 succeeding
generation. So I think we need to be very
7 careful here.
8
If you really want to protect the land and have it
9 green, we need to be
as up front, as straightforward with
10 these landowners as
we can be and give them a chance to
11 still farm but keep
those basically pine, timber, cypress
12 ponds and those types
of things that on their properties a
13 chance to do
conservation easements on those but give them
14 still a chance to
make a living either in sod or cattle or
15 whatever their crop
happens to be so that they can make a
16 living or they're not
going to do these easements and
17 they're just going to
sell to the highest bidder for
18 whatever that reason
is. And I think we can be
19 counterproductive
here and not productive.
20
CFO GALLAGHER: Well, I don't know why we
21 couldn't name -- I
mean, if a certain number of acres is
22 used for crops, let
it be for crops, whatever crop they
23 went to grow, I don't
mind it being spelled out in there.
24 It's just that I
think what we've done is we're paying
25 55 percent in some
cases of the value and we get a list
of
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1 things that we're
getting for it, obviously some of them
2 are pretty good.
But there's things that aren't mentioned
3 that we don't get and
I don't know what those are but I
4 just think we got the
burden on the wrong side, especially
5 when we're paying the
high -- you know 50 percent, 40
6 percent of the value
of it.
7
THE GOVERNOR: Why don't we ask Colleen what the
8 logistical kind of
on-the-ground considerations are.
9
MS. CASTILLE: Well, Governor, we have -- instead of
10 hearing from us, the
Department, what we did was we
11 decided to bring in
some of our partners who engage in the
12 acquisition of
conservation real estate, the sale of those
13 from not only the
independent private representatives but
14 from non-profits as
well. And we have four speakers with
15 us here today.
Dean Saunders, who as a representative
16 started the whole
concept of conservation easements in the
17 green swamp and then
has continued to sell those -- to
18 represent people who
sell those to the State. As well as
19 Clay Henderson,
Richard Hilsenbeck from the Nature
20 Conservancy, and
George Wilson from -- well, who's
21 currently independent
now, I think. So we have those four
22 speakers. And I
would like to bring them up.
23
THE GOVERNOR: Sure.
24
MS. CASTILLE: Because the unintended consequences, I
25 think, are important,
as you brought up
earlier.
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1
THE GOVERNOR: The dean of conservation easements.
2
MR. SAUNDERS: Good morning, Governor and cabinet.
3 Dean Saunders with
Saunders Real Estate. Treasurer
4 Gallagher, I
understand really kind of where you're going
5 with this. But I
really think that it would be good to
6 pause and catch our
breath a little bit. What is it
7 you're really trying
to do?
8
I think the legislative intent was to really restrict
9 development of
property, to keep the property from having
10 rooftops on it.
That was the primary focus of
11 conservation
easements. They were called purchase
12 development rights at
one time, I mean, known by a number
13 of names, land
protection agreements, agricultural
14 easements. But
the more politically correct term is
15 conservation
easements. Ultimately, it is a negotiation
16 between the private
landowner and the State or
17 governmental entity
to what would be allowable on the
18 property.
19
From the government's standpoint, the desire is to
20 limit development on
all of the property and to generally
21 restrict the natural
area that's on the property so that
22 really nothing can
happen with it. It cannot be altered.
23 And in the areas
where you have improved pasture or open
24 land where the farmer
or rancher is making his living,
25 which is what he's
mostly concerned with, to give him
as
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1 much latitude as he
can have that he feels and the State
2 feels is
appropriate. Most of your easements do just
3 that, they're sort of
bifurcated. You know, it's an ag
4 easement really on one
hand and it allows certain
5 agricultural uses in
the improved areas and it's a
6 conservations easement
in the natural areas that doesn't
7 allow for anything
unless it's cutting of pine timber,
8 okay?
9
It doesn't allow for mining. It doesn't allow for
10 oil drilling that I
know. Certainly none of the ones I've
11 done do that.
Your staff has really, you know, done a
12 good job at
protecting your interests. I know, I
13 negotiate these with
them. Typically in those
14 agricultural areas
they're restricting the intensive
15 agricultural use,
i.e., row cropping, to about 25 percent
16 of the improved
pasture area. That's important.
17
Most of my clients, the reason they do conservation
18 easements, and I
believe Commissioner Bronson would back
19 this up, my
experience is they want to do it because they
20 want to see the land
protected, okay? They're not doing
21 this because there's
tons of money. Now they're not going
22 to give away the
rights, okay? But their primary interest
23 is in seeing that the
land is protected frankly beyond
24 their generation,
beyond them once they've passed away.
25 They want to see the
land protected. They want
their
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1 property to be tied
up. They don't want their family to
2 develop the
property.
3
When it enters into the second and third generations,
4 sometimes that
conservation ethic may not be there, that's
5 why they want to do
it, you know. It may be set up where
6 there may be three or
four family members and one really
7 wants to inherit the
ranch but he can't because his
8 sisters don't want him
to, okay. They want the money or
9 more, their
brother-in-laws may want the money so they
10 outvote them.
This is reality. It's the world in which I
11 live. I see
this time and time again. Families break up
12 over this sort of
stuff. And then ultimately the
13 developer comes in
and buys the land.
14
I will tell you, there is not a piece of land that I
15 know of in the
peninsula -- I don't do a whole lot up in
16 the Panhandle --
that's safe from development. I thought
17 there was until I've
seen it. I mean, there are people
18 paying ridiculous
amounts of money from what I would
19 consider for a 10 and
20-acre horse farm. They want to
20 live out in the
country. They want that lifestyle to the
21 intense development
that's going on. It's going on all
22 over the place.
And I think that we need to stay focused
23 on what it is you're
trying to accomplish. You're trying
24 to restrict the
development.
25
I think it would be a travesty to have some of
these
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1 properties, and I can
tell you right now that a number of
2 the clients I
represent will not have an interest in doing
3 this if they feel like
down the road, you know, that their
4 flexibility is taken
away from them. They're not going to
5 want to come up here
and ask you guys for permission to do
6 stuff. And,
again, your staff has done a good job of
7 negotiating that
stuff. I think it would be a travesty to
8 have those properties
that you could have now potentially
9 in conservation, in a
conservation easement that
10 ultimately 10 years,
20 years down the road is going to
11 end up being
developed and be a subdivision. That is far
12 less -- far more
damaging than anything that could ever
13 happen that you could
imagine out of what -- out of a
14 greater restriction
than what you're trying to impose.
15
These ranchers and landowners are concerned about
16 their economic
viability. I mean that is -- and it's
17 their land. I
mean, it's their checking account. It
18 would be like me
giving you a check saying, Here,
19 Treasurer Gallagher,
here's your check for $100,000 but
20 you can only spend
this on gas and food. I don't want you
21 spending it to send
your kids to college. I don't want
22 you spending it to do
anything else. That's in essence
23 what you're
doing. And I think that's going to be
24 problematic for most
of the clients I represent.
25
And, as Commissioner Bronson has pointed out, a
lot
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1 of them will just
simply not do it. They're already
2 concerned. They
tell me all the time, Dean, forever is a
3 long time. I
mean, you know, so I've got to know that
4 we've got the
flexibility to make a living off our land.
5
And these guys are not -- you know, they have a
6 conservation ethic,
you know, they really do. They're
7 good stewards of the
land. We wouldn't be -- you-all
8 wouldn't be sitting
here talking about wanting to protect
9 their land if they
weren't good stewards. But they need
10 the flexibility to
continue to pay the mortgage and to
11 make a living off the
land. A lot of these guys aren't
12 lawyers in Orlando
that are making tons of money and they
13 just do it on the
weekend. I mean, these are guys that
14 are out there
actually on the land doing it.
15
So I just think we really should stay focused on what
16 it is you are trying
to accomplish. And I'm telling you,
17 your staff is doing a
really good job of doing that. And
18 if there are some
areas that you have problems with, then
19 ask them to be more
specific. If it says that it can be
20 drilled for oil or
something and you didn't like it, then
21 make sure they take
it out. I've never seen one that has
22 that.
23
THE GOVERNOR: I've got one right here. Got the one
24 we're actually
discussing.
25
MR. SAUNDERS: That allows that? Well, that's
not
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1 one of my
clients. (Laughter.) And I won't be so brazen
2 as to give you my
phone number like Ralph did. But at any
3 rate, if those are
some problems, I think that's where you
4 need to address them
is in the actual provisions of the
5 easement and not a
carte blanche sort of flipping of the
6 tables. I'd be
happy to answer any questions you might
7 have.
8
THE GOVERNOR: Let's hear from another speaker, Dean.
9 I appreciate your
comments.
10
MS. CASTILLE: Clay Henderson and Richard and George,
11 if you'll all come
up, please.
12
MR. HENDERSON: I guess I'm that lawyer from Orlando.
13 Clay Henderson.
Been involved in development of the
14 Conservation Easement
Program, negotiated, I couldn't tell
15 you how many
easements in this state and in many other
16 states. And so
this is a good debate. I enjoy being a
17 part of it and I
think you're raising some good questions.
18
I'm here primarily to support your staff, Colleen,
19 Eva, their staff has
done a by-the-book job of negotiating
20 these
easements. And what it's done is created a lot of
21 partnership and trust
between the landowner community and
22 the State because
that's what this is. This is a
23 partnership.
Partnerships last a long time. And as
24 you're going to hear
it time and again, perpetuity is a
25 long time and that's
what we're dealing with here, how
do
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1 you define that and
what the presumptions are and must be.
2
I also remember having this discussion with
3 Representative
Saunders and Senator Bronson when we got
4 this program
going. And it's really nice to see that it
5 really has lived up to
a lot of those expectations. So we
6 don't want to kill
this program. And I hear all you-all
7 say that and that's
all good but we do want to be very
8 conscious about the
unintended consequences. What does
9 this program do?
It allows us to get more bang for the
10 buck. It's a
recognition that the landowners are good
11 stewards of the land
and will continue to be good stewards
12 of the land.
And this is something we encounter at lots
13 of rural counties all
over this state, recognition this
14 property still stays
on the tax rolls. And that is so
15 fundamentally
important.
16
So what's the crux of this? I went back to the
17 owner's manual,
which, of course is the statute, and found
18 that, yes, there is
this presumption that's built right
19 into the
statute. It says, It is presumed that a private
20 landowner retains the
full range of uses for all the
21 rights or interest in
landowners' land which are not
22 specifically acquired
by the public agency. That's the
23 presumption.
It's a good presumption because the
24 landowner will stay
in possession of the land.
25
Now, if you change that presumption, it's going
to
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1 change the way you go
into the negotiation process. Now,
2 one reason I'm here is
I have a client, Plum Creek, that
3 many of you had
probably 35,000 acres of conservation
4 easements with the
State, going to come back later this
5 year with maybe
another -- we have 30,000 under
6 negotiation, others on
the list. I talked to them. What
7 is your -- if this
presumption changes, where are you?
8 And the answer is, we
want to be able to tell our
9 corporate owners, our
stockholders, that we have the
10 ability to adapt over
time. And when the presumptions are
11 with the landowner,
they have that ability to adapt. It
12 really does change
it.
13
So if you do change this presumption, a couple of
14 things happen.
One, you've lost a little bit of trust to
15 the landowner.
Two, you're going to end up paying more
16 for these
easements. And, three, you just may lose some
17 opportunities to do
this well. It's a good discussion.
18 It's okay to have
this discussion. But please don't throw
19 out the trust that we
built with the landowner community
20 to make this program
one of the real successes of Florida
21 Forever.
22
THE GOVERNOR: Thank you.
23
CFO GALLAGHER: Well, now, just let me ask a
24 question. I
obviously don't want to change the
25 presumption.
But the question is in the negotiations
of
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1 what who gets spell
out more what the seller of that
2 conservation --
3
MR. HENDERSON: It's about how much of the bundle
4 sticks do you want to
buy and that should be part of the
5 negotiation
process. But at the end of the day, there is
6 going to be a bundle
of sticks left with the landowner and
7 that's the heart of
your program.
8
CFO GALLAGHER: Well, and that's what gets negotiated
9 on each one of them,
it looks to me like. And I guess
10 some people think
it's very clear and others of us are
11 concerned how clear
it is. So that's sort of where I'm
12 coming from, how
clear is it.
13
MS. CASTILLE: Richard.
14
MR. HILSENBECK: Thank you. I'm Richard Hilsenbeck,
15 associate director of
land acquisition for the Nature
16 Conservancy here in
Tallahassee. And the Nature
17 Conservancy is
involved, heavily involved, in locating and
18 bringing forward to
the Florida Forever Program many of
19 these easements that
you-all consider here on a monthly
20 basis and we work
very stringently with many landowners
21 to -- and negotiate
the terms of these easements, do
22 ecological
assessments on the property. We've got over 15
23 years of direct
experience in negotiating these easements
24 and I will echo what
the other speakers have said, the
25 staff at Division of
State Lands is doing an excellent
job
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1 in negotiating these
easements.
2
We definitely want to thank the governor and cabinet
3 for wanting the most
stringent protection possible under
4 these conservation
easements. That's very laudable and I
5 will tell you, the
staff is doing that and negotiating all
6 the terms and
conditions.
7
The reasons that these properties are located and are
8 desirable conservation
lands is because they currently
9 have excellent quality
or good, natural resources that are
10 worthy of protection
under Florida Forever and the owners
11 have been very good
stewards of these properties over the
12 years and we'd like
to see that continue, that
13 stewardship, under
private ownership and these easements
14 are a very good deal
for the State.
15
THE GOVERNOR: Are these easements transferable?
16
MR. HILSENBECK: Yes, they are. They can be
17 bequeathed by a
will. There are many provisions that
18 allow them to be
transferred. The State typically retains
19 a right of first
refusal. However, to buy an underlying
20 fee simple interest
if it's outside of a lineal descendent
21 receiving the
property.
22
As a starting point for all easements, I would have
23 to say that what
Treasurer Gallagher would say, that if
24 it's not specifically
prohibited or granted, that it is
25 prohibited, that
would be a great starting place for
all
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1 these easements and
perhaps all those easements should
2 start with that
language. However, in many cases, we
3 found this to be true
and Dean and Clay can tell you and
4 George as well, that
is typically a deal killer. An owner
5 will just not sign
that language. But that is a starting
6 point. However,
there are many, many other provisions
7 that are very
meticulously negotiated with an
8 understanding of the
resources and the uses on that
9 property that do,
absolutely protect the natural resource
10 values of these
properties or the Nature Conservancy would
11 not be a major
proponent of these conservation easements.
12 So that's a great
starting point.
13
The owners definitely need a measure of flexibility.
14 As Commissioner
Bronson said, these ranchers that we deal
15 with, they're telling
us they've got to have at least
16 three sources of
income, agriculture is a tough business.
17 If the cattle market
goes down one year, they've got to
18 have some other
source of income. There has to be
19 flexibility built
into these. It's very difficult to
20 think of every single
provision to put into the prohibited
21 uses and/or the
retained rights.
22
For example, it was brought up today. What if
23 someone down the road
wanted to have an Easter sunrise
24 service on one of
these properties? Well, that wouldn't
25 specifically grant
it, that would be prohibited under
this
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1 and that shouldn't
be. That's not going to impact the
2 natural resource
values of that property. It's a pretty
3 good example.
4
THE GOVERNOR: That was just a tack. I can see the
5 headline tomorrow,
Governor and Treasurer against Easter
6 services.
7
(Laughter.)
8
MR. HILSENBECK: All these --
9
CFO GALLAGHER: Got any other good examples?
10
(Laughter.)
11
MR. HILSENBECK: There are some other good ones and
12 Mr. Tucker could
--
13
CFO GALLAGHER: Tell me about them later, would you?
14
(Laughter.)
15
MR. HILSENBECK: You have to understand what we're
16 asking owners to do
under these easements and these are
17 good
conservation-minded, good stewards of the land, these
18 owners, and
particularly in this item as well, Item 10.
19 But we're asking them
to continue to pay the taxes on
20 these properties, to
manage these properties in
21 perpetuity, to
provide security and fencing on the
22 properties, to
control invasive exotics in many instances.
23 These are expensive
laborious activities that these owners
24 need that easements
are -- they have still got to have --
25 yes,
sir?
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1
CFO GALLAGHER: They've sold us their conservation
2 easement. Are
they at the same -- are they paying the
3 same amount of taxes
they were paying before?
4
MR. HILSENBECK: Typically what we have found, and
5 that's up to the local
property appraiser in the county,
6 but typically the
taxes do not go down. These properties
7 are typically already
in an ag exemption or some kind of
8 green belt
exemption. We've not found that their property
9 taxes decrease under a
conservation easement, no, they do
10 not. So they're
still paying the same amount of taxes.
11 So there's still a
large burden for a long time on all
12 these owners.
13
And not every property -- there are virtually no
14 properties out there
that we're trying to get an easement
15 that is 100 percent a
natural area. And as Dean pointed
16 out, those properties
that do have considerable natural
17 area, and most of
these do or we wouldn't be interested in
18 them, those are
stringently protected by the provisions of
19 the easement.
Those natural resources are very highly and
20 stringently
protected. The other areas that have been
21 subject to some kind
of agricultural activity, it's
22 appropriate so those
owners can make a living on these
23 properties and pay
the mortgage to continue some type of
24 agricultural.
25
CFO GALLAGHER: So then what you're saying is
that
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1 there is real
prohibition on the environmentally
2 endangered
property?
3
MR. HILSENBECK: Yes, the natural areas, those are
4 essentially -- those
are defined, delineated --
5
CFO GALLAGHER: Wetlands?
6
MR. HILSENBECK: -- and they are very strict
7 provisions. They
basically assume they can't do anything
8 in there.
Sometimes they can bring some cattle in there
9 but they can't convert
any of those natural areas unless
10 you approve that in a
negotiated provision. They can't
11 convert any of those
natural areas to any more intensive
12 uses or ag
uses. They're going to continue to try to make
13 their agricultural
living on the property that they
14 already have in a
somewhat disturbed condition for cattle,
15 sod, hunting
activities, whatever.
16
CFO GALLAGHER: So on those natural areas, we are
17 doing what I'm asking
to do?
18
MR. HILSENBECK: Absolutely.
19
CFO GALLAGHER: It's prohibited unless permission to
20 change it?
21
MR. HILSENBECK: Absolutely. Those are very strict
22 provisions that spell
out in detail that they cannot
23 change those yet they
have to continue to manage them in
24 an ecologically sound
and responsible way and remain good
25 stewards of the
property.
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1
And I'll just say, on the item before you, Item 10,
2 the terms of this
easement have been very heavily
3 negotiated and they're
excellent. There are very good
4 terms in this
easement. The oil drilling issue, that has
5 been changed.
Oil could be explored for off of the
6 property, not on the
property at all subject to the
7 easement. That
has been moved off --
8
THE GOVERNOR: Oil drilling in the Apalachicola
9 basin? There's a
headline.
10
MR. HILSENBECK: The chances that there would be any
11 petroleum reserves
under that property are virtually moot.
12
THE GOVERNOR: Well, but there's a good example where
13 under the existing
system rights were attempted to be
14 maintained. Now
I understand it's the duty of the
15 Department to push
back and not to allow that and
16 apparently they've
done that in this case.
17
MR. HILSENBECK: Yes, they have.
18
THE GOVERNOR: Maybe what we could consider,
19 Treasurer, I'd like
to get your view on this, is to allow
20 for the Department to
attempt to negotiate a more
21 restrictive lease
which would have a greater value which
22 we would have to pay
for but also give the Department more
23 flexibility to
continue to do what it's doing which is, as
24 I understand it, we
lead the nation by a significant
25 amount in terms of
the acres or value of
conservation
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1 easements and it is --
I mean we put lot of dough in these
2 programs but it is
still limited and so it is a great way
3 to leverage what we do
so that for the folks that were
4 willing to give up
that, all the really good points that
5 you-all have made,
they would be willing to take that
6 risk, they would get a
higher value because we would be
7 getting more
certainty. We're shifting -- we pay more for
8 the certainty of what
we end up owning in essence.
9
CFO GALLAGHER: Well, have we done a comparison of
10 rights purchased or
given up by the landowners and value
11 paid for it compared
to other states?
12
MR. HILSENBECK: Florida is consistent with other
13 states but I'd say at
this point we're really at the
14 forefront of
conservation easements across the nation.
15 That analysis is
actually being undertaken but I don't
16 know that those
figures are available.
17
CFO GALLAGHER: But volumewise, for sure, we're ahead
18 of how much we're
doing. I think it would be very
19 interesting to find
out, sort of look at the contracts,
20 you know, what other
states are purchasing or other local
21 governments are
purchasing based on appraised value and a
22 percentage of that
and what the contracts say, what
23 they're getting.
24
THE GOVERNOR: That's an excellent point.
25
CFO GALLAGHER: I'm sure we're not the only
ones
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1 doing this but maybe
we're doing more than anyone. But it
2 might be -- I mean, I
don't want to get in a contest to
3 see who's paying the
most or something like that.
4
MR. HILSENBECK: Well, Florida land values are higher
5 compared to many other
states except for places like
6 California or New York
City, that type.
7
CFO GALLAGHER: But that shouldn't make a difference
8 because we're talking
--
9
THE GOVERNOR: We're talking about a percentage of --
10
CFO GALLAGHER: -- a percentage of the value. So
11 what we're getting,
we're getting certain --
12
MR. HILSENBECK: That would vary according to each
13 individual
easement. They're all negotiated
14 independently,
separately, based on the values, ecological
15 values of the
property and what the owner is doing out
16 there and what
they're willing to sell or give up. So it
17 would be very
difficult to take into account all those
18 variables, how many
of their bundle of rights they sell
19 determines how much
--
20
THE GOVERNOR: That's the point I was trying to make,
21 is if we at least
started with a more stringent or, you
22 know, the benefits
stay to the State with the policy being
23 that if landowners
don't want to pursue that, that we
24 would go to what now
is the traditional way of doing
25 things. That
seems like an appropriate policy and
it
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1 would be, I think,
very useful if we're going to do that,
2 to find out what other
states are doing because they may
3 have already started
that process.
4
MS. CASTILLE: Governor, I want to give you an idea
5 of how I've seen the
cabinet process work. When -- it's
6 really interesting to
see how people interpret the actions
7 that happen in this
room. And what we started with many
8 years ago was the
acquisition of conservation easements
9 with this significant
presumption based on what we would
10 get and that we would
only give to the landowners a little
11 bit and it was
significant with the Lykes case. And the
12 Lykes case was the
settlement of a lawsuit. And what we
13 ultimately said was,
Here, Lykes Brothers, here are all
14 the things that you
can do and we're going to retain all
15 the other
rights. And we went and tried to do other
16 conservation
easements like that and we did not get a very
17 many -- a very large
number of people who wanted to engage
18 in those type of
conservation easement agreements.
19
And so in late 1999, we pushed, we from the
20 governor's office,
pushed the DEP to look at conservation
21 easements --
22
THE GOVERNOR: They are so slow to respond, don't you
23 think?
24
MS. CASTILLE: They've actually responded very well.
25 And that we have 10
percent of the lands that we buy
in
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1 conservation
easement. So that doesn't include any of the
2 other lands that are
in conservation ownership. So it's
3 just 10 percent of the
lands we buy with any different
4 level of rights that
are shared between those -- between
5 us and the
landowners.
6
But what happens when you, the governor and cabinet,
7 make a decision and
take an action here today, it gets
8 headlines
tomorrow. And so the headlines tomorrow would
9 be that the governor
and cabinet want to change the
10 presumption of -- the
presumption of ownership under
11 conservation
easements. And then that will reverberate
12 just like a rock in a
pond throughout the state of Florida
13 and that trust that
we've built up with the rest of the
14 owners who are
interested in conservation easements which
15 grows as we've begun
-- as we've built that trust, is it
16 diminishes if that
message goes out there.
17
So while I hate to stand up here and oppose a
18 direction you were
going in, I just think that the
19 unintended
consequences of the action will be far greater
20 than the good
intentions that you really and truly have
21 behind your actions,
sir.
22
(Laughter.)
23
THE GOVERNOR: Well stated.
24
CFO GALLAGHER: So you wanted to say, Cabinet votes
25 to continue
conservation easements the way they've
always
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1 been?
2
MS. CASTILLE: Protecting the ecological resources of
3 the State.
4
THE GOVERNOR: General Crist? I admire your
5 statement.
Secretary, you've swayed me temporarily.
6
GENERAL CRIST: So your concern is that if we make it
7 arguably somewhat more
restrictive, that less people will
8 be wanting to enter
into them and we may be conserving
9 less land?
10
MS. CASTILLE: Yes, sir.
11
COMMISSIONER BRONSON: Governor, if I could, one of
12 the things, and I was
looking at some of these --
13
THE GOVERNOR: Let's bring this baby in for a landing
14 here.
15
COMMISSIONER BRONSON: Some of these dos and don'ts
16 here between the
State's reserve rights and the
17 landowner's reserve
rights and I saw a couple of those
18 that could be
reversed. What is not granted to the
19 landowner under these
conditions, the State may negotiate
20 to do. And let
me give you a perfect example.
21
If you've got a piece of land that happens to be a
22 conservation easement
next to a lake or waterway that is
23 imperiled and the
Game and -- or Fish and Wildlife
24 Commission -- I'm
stuck in the old Game and Fish -- but
25 Fish and Wildlife
Commission goes in under their
program
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1 to clean out those
areas, they got to be able to put that
2 spoil somewhere and
sometimes that can be adjusted, even
3 though it's called
spoil, it could be adjusted to some of
4 these lands to keep
from hauling it miles and miles away
5 to get rid of
that.
6
Now under some proposals that would impact,
7 positively impact the
environment, the State may be able
8 to work that
out. But under this proposal, the landowner
9 wouldn't be able to do
the exact same thing the State may
10 want to do later on
for the best interest of the
11 environment.
And so that's the reason why I said from the
12 very beginning we
better be very careful about what we ask
13 for, we might
actually get it and then we'll have those
14 unintended
consequences everybody has been talking about.
15
THE GOVERNOR: All right. Well, we have other
16 speakers but --
17
MR. HILSENBECK: Could I make one point on the
18 Apalachicola River
protection?
19
THE GOVERNOR: The offshore drilling -- I mean the
20 drilling in the basin
that was in the lease until it was
21 pushed back?
22
MR. HILSENBECK: That is correct. This is a 2100 and
23 2400-acre
conservation easement. 1773 acres of it are
24 floodplain forest and
bottom land forest. Those in the
25 easement are defined
as a special natural area.
Those
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1 areas cannot be
harmed. That's all that land directly
2 along the Apalachicola
River is completely protected
3 from any adverse
activity --
4
THE GOVERNOR: Well, see, this is a good example. I
5 would think that we
would want to pay more to prohibit
6 certain uses.
Offshore -- I mean directional drilling
7 from your property
would be something that would be
8 unconscionable, there
would be no way to defend. And the
9 fact that it was even
being negotiated is troubling. So
10 in response to that,
that's where you see the concern. If
11 that's the case right
now, you know --
12
CFO GALLAGHER: What else are we negotiating?
13
THE GOVERNOR: Yeah. You can see why we're concerned
14 about that, don't
you?
15
MR. HILSENBECK: Absolutely.
16
CFO GALLAGHER: Now, looking at this particular one,
17 there are some very
good -- a list of prohibited uses.
18 Unfortunately we
didn't start with it as strong as it is
19 today, I guess.
And I'm not going to bother reading them
20 to everyone but I did
have them written out for me. And
21 it allowed the owner
to have certain rights which is good.
22 And, again, includes
but not limited to.
23
The interesting thing on the easement of summary is
24 it says that they are
prohibited but it's not limited to
25 the following
prohibited uses and I'm trying to figure
out
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1 how you would have
prohibited uses but not limited to.
2 What would the other
ones be that -- in the contract?
3
MR. HILSENBECK: Well, some easements are opened up
4 down the road and
other provisions are placed in them and
5 that is a rare
instance. But it's difficult to think of
6 everything as Dean
said. Forever is a long time. It's
7 difficult to think of
every conceivable activity that
8 might arise in the
future through new technology that may
9 be some appropriate,
nonecologically or environmentally
10 degrading activity
that could take place on that property.
11 It may be some very
clean technology that is not yet
12 envisioned that an
owner in a hundred years from now may
13 want to engage
in.
14
CFO GALLAGHER: But you'd have to come back to us
15 whether it says, Not
limited to, or didn't say, Not
16 limited to, wouldn't
you?
17
MR. HILSENBECK: That may be legalese. I honestly
18 don't know that I
could address that specifically well
19 enough for you.
20
THE GOVERNOR: All right. Colleen, box it out and
21 get back in there
then. Any other discussion?
22
MS. CASTILLE: One last point. In the conservation
23 easement, the
document itself should really be read in
24 whole and we start
out the conservation easement with a
25 purposes statement
that says that it is the purpose of
the
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1 easement to ensure
that the property will be retained
2 forever in its natural
scenic wooded condition to provide
3 a relatively natural
habitat for fish, wildlife, plants or
4 similar ecosystems and
to preserve portions of the
5 property as productive
farm land and forest land that
6 sustain, for the long
term, both the economic and
7 conservation values of
the property and its environment
8 through management
guided by the following principles.
9 And it's those bullet
points that you've been talking
10 about.
11
The protection of scenic and other distinctive rural
12 characters, the soil
productivity and control of soil
13 erosion, maintenance
and enhancement of wildlife and game
14 habitat, protection
of unique and fragile natural areas.
15 Maintenance or
improvement, and you get the drift. So
16 essentially if
somebody went in and did something, another
17 unintended
consequence, then we would at least -- we would
18 have that paragraph
to say, Here's the overall guidance
19 with an easement.
20
THE GOVERNOR: I'm not sure that's the part of the
21 document that's
binding, you know, the intent clause or
22 whatever it's
called.
23
CFO GALLAGHER: Colleen, another question. The
24 property is going to
be monitored by the DEP Office of
25 Environmental
Services in this particular contract.
Do
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1 you have access to the
property?
2
MS. CASTILLE: Do we have access to the property? We
3 do get access to the
property, yes. Do we visit on an
4 annual basis? On
an annual basis.
5
CFO GALLAGHER: You can only go once a year or you
6 can go any time you
want or you go once a year?
7
MS. CASTILLE: We do it with notice. We go once a
8 year.
9
CFO GALLAGHER: Any time you want? Or can you only
10 go once a year?
11
(Off-the-record discussion.)
12
MS. CASTILLE: We just, as far as workload goes, we
13 require our staff to
go out there once a year. But we
14 could go at any
time.
15
CFO GALLAGHER: Okay. Colleen, can I ask a question
16 too? If you
offer an agreement to someone, let's say
17 you've got a big
tract of land and you offer in your
18 agreement with them
there will be no hunting allowed and
19 they sign it, then of
course that stands because you
20 negotiated that
agreement.
21
Now if someone says, if you offer that agreement and
22 they say absolutely
not, we've hunted this area for years,
23 we're not going to
sign that portion, then you are able
24 either to negotiate
in or out some of these issues that
25 you're talking about
as long as it's consistent with
what
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1 you're going to hold
the land for for natural resources
2 purposes, right?
3
MS. CASTILLE: That's correct.
4
COMMISSIONER BRONSON: So the whole point here, in
5 some cases, you may
get some negotiations that you may
6 want that the other
people don't care about. And in other
7 ways, you could still
lock up some land for development
8 rights that people
want to retain certain rights, and it
9 gives you the option
of making those agreements based on
10 negotiations; is that
correct?
11
MS. CASTILLE: It does. We have the full range of
12 options right
now.
13
COMMISSIONER BRONSON: My point is, if you stick this
14 thing on a wall and
it says, Here's all the issues, buy it
15 or don't buy it,
you've got a better chance of losing a
16 lot of negotiations
or losing a lot of conservation
17 easements. But
if you're still willing to go in there and
18 can negotiate those
agreements, which what someone is
19 willing to accept or
not to accept other than the major
20 issues of no oil
drilling, no rock mining, then at least
21 you can put more land
under those easements and take them
22 off the developmental
roles than we have right now even;
23 isn't that
correct?
24
MS. CASTILLE: That's correct.
25
THE GOVERNOR: Okay. I think we've had
enough
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1 conversation about
this.
2
MS. CASTILLE: Okay.
3
THE GOVERNOR: What do we have in front of us?
4
MS. CASTILLE: We have Item 10 in front of us which
5 is the consideration
of perpetual conservation easement,
6 over 2,124 acres
within the Apalachicola. We did go in
7 and negotiate again
with the landowner an additional
8 element of the
exploration and extraction of oil. And it
9 allows the directional
drilling, provided the drilling
10 originates outside of
the property and does not adversely
11 impact the
conservation purposes of the easement.
12
THE GOVERNOR: So you can directionally drill from
13 the property --
14
MS. CASTILLE: From outside the property.
15
THE GOVERNOR: From the property out?
16
MS. CASTILLE: No, from outside the property in, to
17 underneath the
surface of the property that we are
18 acquiring the
conservation easements --
19
THE GOVERNOR: So we're not acquiring the mineral
20 rights?
21
MS. CASTILLE: We are not acquiring the mineral
22 rights. We do
this sometimes. Governor, we do this
23 sometimes in full fee
acquisitions where we don't acquire
24 the mineral
rights. What we do is we have our
25 geologist
--
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1
THE GOVERNOR: So what is the State's -- what is the
2 strategy to -- I mean,
what's the price you placed on
3 allowing someone to
keep their mineral rights that would
4 be required to drill
to get to, whether it's directional
5 or not, I mean, if you
find it's the problem. It's the
6 environmental issues
related to the development of the
7 well that's the
issue.
8
MS. CASTILLE: And all of those issues will be under
9 permit from the
Department. So under the permit, we would
10 protect the resources
through permit.
11
THE GOVERNOR: You think you got a better deal
12 because you didn't
negotiate that out?
13
MS. CASTILLE: Sometimes property owners believe that
14 their mineral rights
are going to be their future lottery
15 ticket. And we
have not seen that that is the case in the
16 15 years that I've
been operating in this process.
17
THE GOVERNOR: The Bureau of Geology says that the
18 only thing to be
drilling for is quartz sand in all
19 likelihood.
20
MS. CASTILLE: Sand. But, you know, that would have
21 some destruction of
the environment if they were just
22 pulling sand from
under the ground.
23
THE GOVERNOR: Okay. Well, that's what you're
24 allowing them to do
with this lease and that just seems
25 like it's in conflict
a bit with the preamble that
you
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1 described that was
written so eloquently about protecting
2 the critters and the
resource and all that.
3
COMMISSIONER BRONSON: Let me ask a question,
4 Governor, if I
can. If you allowed some type of process,
5 whether it's quartz
sand, oil, or whatever it is, and they
6 cause an action on the
land that's actually under the
7 conservation easement,
then there can be some type of
8 action by the State
because they have disturbed the
9 conservation easement;
is that not correct? I'm not a
10 lawyer, but it seems
to me if I pump sand or oil from one
11 direction out from
underneath the land that's under the
12 conservation
easement, there's a big sinkhole that forms
13 there, then you have
a right to go back to that person and
14 fine them for
disturbing that land that's under
15 conservation; is that
not correct?
16
MS. CASTILLE: That's correct. I was just asking the
17 staff, I did not know
of any technical ways to mine sand
18 through technical
drilling. All sand mines are topical
19 extraction of the
minerals.
20
THE GOVERNOR: But why grant it?
21
MS. CASTILLE: It's for oil drilling.
22
THE GOVERNOR: Okay. Square it then. My concerns --
23
MS. CASTILLE: It does, Governor. You know, we have
24 a number of these
type of leases throughout --
25 acquisitions of
property throughout the state
and
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1 owners -- I mean, it's
historically through all real
2 estate transactions in
the state, not just with DEP, but
3 there are a multitude
of mineral rights that people held
4 on to thinking they
had something. And typically what
5 happens is later on
down the road --
6
THE GOVERNOR: And we pay a huge price for them and
7 we've bought them in
the Everglades and we've attempted to
8 buy them off Destin
Dome, that's done too. So why --
9
MS. CASTILLE: But those two places -- I'm sorry,
10 sir. But those
two places are where there is a
11 likelihood -- a
higher likelihood that oil or gas may be
12 found. That's
why we pay for them. If you're in Palm
13 Beach County and you
have a mineral right that you're
14 acquiring, it costs
three, nine, $12,000.
15
THE GOVERNOR: Nature Conservancy has dealt with this
16 transaction?
17
CFO GALLAGHER: Yes.
18
THE GOVERNOR: And you're comfortable with approving
19 directional
drilling?
20
MR. HILSENBECK: Directional drilling cannot take
21 place from the
property at all.
22
THE GOVERNOR: Not from the property, into the
23 property.
24
MR. HILSENBECK: We are reasonably comfortable with
25 that provision that
if the owner could negotiate with
an
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1 adjacent landowner to
drill from their property with the
2 provisions that DEP,
oversight of that, we are comfortable
3 because the floodplain
area and the other high quality
4 natural resources on
that property are completely and
5 stringently protected
under this. And there is no way
6 they are going to get
sand out of a directional drill
7 hole. Sand
mining is prohibited. What the Bureau of
8 Geology has said is
the only merchantable mineral they
9 think is under there
is sand and there is a strict
10 prohibition on the
mining of sand.
11
THE GOVERNOR: So the Nature Conservancy is on record
12 if we go forward that
you would be supportive of a clause
13 that theoretically
allowed for directional drilling into
14 or underneath the
property?
15
MR. HILSENBECK: We will stand with the Division of
16 State Lands as the
partner in this, yes, sir.
17
THE GOVERNOR: Wow. Okay.
18
MS. CASTILLE: So we have a conservation easement in
19 front of us.
20
(Laughter.)
21
THE GOVERNOR: Is there a motion?
22
COMMISSIONER BRONSON: I move approval of Item -- is
23 it 10?
24
THE GOVERNOR: Yes, it is.
25
CFO GALLAGHER: Did we get the sand drilling out
of
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1 there?
2
MS. CASTILLE: Yes, sir. It only allows for drilling
3 of gas or oil and from
adjacent property owners.
4
THE GOVERNOR: Just oil and gas.
5
MS. CASTILLE: Oil and gas.
6
CFO GALLAGHER: That's out?
7
MS. CASTILLE: No, it's in. That's the only thing
8 that's in, is oil and
gas. No sand mining, no other
9 mineral mining.
10
THE GOVERNOR: Is there a second?
11
(No response.)
12
THE GOVERNOR: The motion dies.
13
MS. CASTILLE: Item 10 fails for lack of a vote.
14
THE GOVERNOR: It does. And I think this is a very
15 good example of what
we should be doing which is rather
16 than change -- I've
been convinced on one thing, which is,
17 rather than changing
the burden, I think the case was made
18 very compellingly
that our job should be to negotiate
19 thoroughly to make
sure that the rights that people get
20 are clear but not to
switch. And if we do switch the
21 burden or switch the
paradigm as we were talking about, we
22 could be paying
more. You should be given that
23 flexibility to do it
but I think it would be of greater
24 value for the
State.
25
MS. CASTILLE: Okay. We will take that
direction,
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1 sir.
2
THE GOVERNOR: Thank you everybody who came to
3 educate us on
this.
4
CFO GALLAGHER: I think it was a good discussion. I
5 think you'll move
ahead in the right direction. And, you
6 know, we want to
continue doing these and we want to have
7 people willing to do
it. But we also think we're buying
8 the mineral
rights.
9
COMMISSIONER BRONSON: Can I -- Governor, with that
10 statement in mind
now, we have bought -- the State of
11 Florida has bought a
lot of land without buying mineral
12 rights.
13
THE GOVERNOR: I know and we've had lively debates
14 about it.
15
COMMISSIONER BRONSON: And there are a lot of people,
16 individuals,
including myself and people sitting in this
17 audience that have
bought land but did not get a chance to
18 buy the mineral
rights because those who own the mineral
19 rights would not sell
them.
20
THE GOVERNOR: That's right.
21
COMMISSIONER BRONSON: So, you know, if this is all
22 based on the mineral
rights, we may be talking about a lot
23 different issue here
about land acquisition, period,
24 whether it's for
conservation easements or the State
25 buying any type of
land or selling any type of land.
If
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1 the State is going to
sell the land is the State -- and
2 let me tell you, I
know a lot of pieces that I voted to
3 sell here but I don't
believe we sold the mineral rights
4 to that land at
all. I think the State of Florida, as I
5 remember, retains the
mineral rights in almost every land
6 sale that I can
remember. So we may be talking about an
7 issue here that's even
bigger than what we've already
8 talked about.
9
THE GOVERNOR: No, I don't think so because I think
10 at least the guidance
that I believe we should give the
11 Department is that
these things should be looked at in a
12 case-by-case
basis. I do not believe that we should be
13 allowing, even if
it's highly speculative, oil and gas
14 drilling in the
Apalachicola basin. That's my personal
15 view and that's why I
voted, though I couldn't have
16 seconded the motion
until I gave up the gavel. But these
17 other issues should
be looked at and negotiated on a
18 case-by-case basis
because there are certain rights that
19 landowners will never
want to give up. And they have
20 every right to do
that.
21
COMMISSIONER BRONSON: I don't disagree with you
22 about drilling for
oil in the Apalachee basin. But I will
23 tell you this, it
covers a lot more mineral sources than
24 just oil or
gas. And I think this basic issue of mineral
25 rights -- and if we
-- if we demand or retain them,
and
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1 that's our option
because we either make the deal or we
2 don't make the deal,
and that is our option, but there
3 again, we're going to
be dealing with individuals in this
4 state that are going
to take what we do here today and
5 say, Okay, if that's
the way it's going to be, then I want
6 to retain my mineral
rights before I sell land to State.
7
THE GOVERNOR: All I'm saying is my lack of a second,
8 if I was in a position
to do so, related to this specific
9 property and nothing
more.
10
CFO GALLAGHER: And it can be fixed.
11
THE GOVERNOR: I think we so muddied this up though
12 at least Gallagher's
attack on Easter has been mitigated.
13
(Laughter.)
14
THE GOVERNOR: Item 11.
15
MS. CASTILLE: Item 11 is a consideration of separate
16 perpetual
conservation easements. And it's being
17 recommended for
withdrawal. And this actually is,
18 Governor, if you put
the person who has the lease on this
19 property, series of
owners, Mr. Carter and related persons
20 have ownership,
underlying ownership of this property, and
21 Rayonier has a timber
lease but subsequent to us putting
22 this item on the
agenda, we got the details of the timber
23 lease and the timber
lease is really very similar to what
24 you're asking the
State to do, to have all of the rights
25 of ownership of the
land. So really we would be
getting
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1 nothing in buying the
underlying fee ownership of this
2 property and a
conservation easement over this property.
3
CFO GALLAGHER: Well, nothing for 12 years.
4
MS. CASTILLE: For 12 years and then Rayonier gets
5 the right of first
refusal.
6
CFO GALLAGHER: To buy?
7
MS. CASTILLE: To buy.
8
THE GOVERNOR: Well, let's have -- do we have
9 speakers?
10
CFO GALLAGHER: Yeah, I think Mr. Richmond wants to
11 talk. Let me
just throw something out when you're --
12
MS. CASTILLE: After the speakers?
13
CFO GALLAGHER: Yeah. While you're speaking, if you
14 might include
something of interest to me and that is it
15 looks to me like on
2/25/02 240 acres were purchased for
16 $1282 an acre and
we're going to buy double that at 300 --
17 we're ending up
paying -- we're paying twice as much as
18 that for what's
supposed to be 50 percent of the value; is
19 that what the deal
is? I'm reading that wrong?
20
MS. CASTILLE: Are you reading the item?
21
CFO GALLAGHER: Yeah, I'm just reading one piece of
22 it though.
There are different parcels and that was the
23 Carter/Nowicki
parcel.
24
MS. CASTILLE: 2,383 acres; is that what you have?
25
CFO GALLAGHER: That's what is being purchased.
But
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1 240 of it was
purchased at $1200 an acre. And we're
2 buying it at, I guess,
275; is that correct? Maybe we're
3 buying it at
275. Never mind. I'll redo my math.
4
THE GOVERNOR: Why don't we --
5
MS. CASTILLE: I see where you are, Treasurer.
6 That's what we're
looking at is that the Carter/Nowicki is
7 2,383 acres. It
was appraised at approximately $657,000
8 for the purchase price
of these conservation easements for
9 $276 per acre, and fee
value is $1,787 per acre for that
10 particular
parcel.
11
THE GOVERNOR: Because of the lease, I assume.
12
MS. CASTILLE: Yes.
13
CFO GALLAGHER: Now, is the lease included in that?
14
MS. CASTILLE: No.
15
THE GOVERNOR: The lease depreciates the value --
16
CFO GALLAGHER: Oh, it's not. So a 12-year lease
17 makes the value of
this less?
18
THE GOVERNOR: Well, that's why it's two --
19
MS. CASTILLE: That's why the conservation easement
20 is only 275 per
acre.
21
CFO GALLAGHER: Okay.
22
MS. CASTILLE: Mr. Gardner.
23
MR. GARDNER: Mr. Gardner, appreciate that. Tom
24 Gardner along with
Ron Richmond represent a portion of the
25 Carter family which
owns 11,000 acres of the Pinhook
Swamp
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1 on the immediate
western edge of 441 north of Lake City,
2 just south of the
Georgia border -- east, I'm sorry, east
3 of 441. Do
you-all have a map by any chance of the
4 project?
5
MS. CASTILLE: There's nothing there. Is that it?
6
THE GOVERNOR: That's it right there.
7
CFO GALLAGHER: That's 12. We're on 11.
8
MS. CASTILLE: They're connected.
9
THE GOVERNOR: Eleven is the one right to the right.
10
MR. GARDNER: Yeah, 12 addresses this small parcel
11 down here which is
not under a timber lease. Item 11 is
12 the -- basically this
area right in here.
13
THE GOVERNOR: When you point --
14
MR. GARDNER: Sorry, where is the pointer? Is there
15 a pointer?
16
CFO GALLAGHER: You can't point to this.
17
MS. CASTILLE: The parcels to the east of the red
18 line but north of the
blackened parcel are the parcels
19 that he's talking
about.
20
MR. GARDNER: If you go to the east to the red line
21 and if I can --
22
CFO GALLAGHER: I gather on this map that up is
23 north?
24
MS. CASTILLE: These here.
25
(Indicating.)
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1
THE GOVERNOR: Okay.
2
CFO GALLAGHER: There you go. Now we can see it.
3
MR. GARDNER: And I just want to give you a little
4 bit of background and
try to bring you up to where we are
5 and there are other
speakers and the representatives of
6 the family are
here. This all started back a number of
7 years ago.
8
Number one, the Pinhook Swamp is probably, in terms
9 of wetland resources,
the state of Florida number one or
10 number two.
Green Swamp is the other one in contention.
11 So this is an
extremely valuable water recharge area for
12 the state of Florida
and is particular for north Florida
13 for the Jacksonville
area. The major players in the
14 acquisition of the
Pinhook Swamp is the Suwannee River
15 Water Management
District, the national forest and the
16 state of
Florida. You-all have purchased a number of
17 acres. The
overall project is 180,000 acres and
18 116,000 acres have
been purchased to date.
19
About six years ago the Water Management District
20 began discussions
with the Carter family on 11,000 acres
21 in terms of bringing
it under a conservation easement.
22 They were also
dealing with some other owners in the area
23 and the negotiations
went forward. One of the aspects of
24 that negotiation was
the Water Management District was
25 going to buy the
timber. The Water Management
District
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1 closed on 15,000 acres
in the Pinhook Swamp which they
2 were supposed to swap
with the national forest or they
3 were supposed to
receive reimbursement from the national
4 forest. That
reimbursement did not come through.
5
As a result, they found themselves in a financial
6 difficulty and at that
point their board made a decision
7 to discontinue all
negotiations except for fee
8 acquisitions on the
Suwannee River. That is when Ron
9 Richmond and I became
involved in the project. We
10 received a call from
Michael Carter and he asked if we
11 would meet with the
Suwannee River Water Management
12 District people and
find out if that was true. And we did
13 meet with them and
they said, We would like to buy the
14 property -- like to
do the conservation easement but we
15 have reached a
position in our process where we can't go
16 forward.
17
At that point, we brought an amendment to the ARC
18 committee which would
have extended the boundaries of the
19 Pinhook Swamp to
include this area, Pinhook Swamp project.
20 At the time it was
well received by the ARC committee and
21 I have a letter and I
just want to read one little piece
22 of the letter that
was in the application. And this is
23 dated September 17th,
2002. And this is addressed to the
24 head of the
environmental services area that handles the
25 ARC
applications.
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1
It says Rayonier Timberlands Operation Company has a
2 timber lease on all
the properties of the owners listed
3 except for any
ownership of properties owned by John
4 Michael Carter Jr.,
John Michael Carter, and Colbin S.
5 Carter and his wife
and Al Levings.
6
So at that point in time, as it was going through the
7 process before it was
reviewed by the ARC committee, and
8 I'm assuming this
letter was reviewed by all the people on
9 the ARC council, they
knew that there was a timber lease
10 on the
property. I don't remember there being a negative
11 vote but I'm not
going to say there wasn't a negative vote
12 but it was well
received and it moved from that point
13 forward.
14
Once it was amended into the process, Pinhook Swamp
15 was a B category
project which meant it couldn't be
16 acquired, it was not
in the money. We came back and we
17 talked to each of the
members of the ARC committee. We
18 put on a
presentation. We had a number of people who may
19 still be in the room
who stood up and supported Pinhook
20 with this new piece
in it to be elevated up from B to A
21 and it was elevated
from B to A.
22
We began negotiations with the State or working with
23 the State shortly
thereafter. There were some decisions
24 made early in the
process and those decisions, not by us,
25 but in terms of the
Department's approach to
this
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1 acquisition, and that
was that they were not going to buy
2 the timber. They
were going to leave basically the timber
3 in place, move forward
on the purchase of the conservation
4 easement after the
timber lease ran its course, certain
5 aspects of the timber
lease would come into play.
6
Now, when we came before you-all in May --
7
THE GOVERNOR: What do you mean by certain aspects?
8 Is that the right of
first refusal aspect? I don't know
9 what that means.
10
MR. GARDNER: There are a number of provisions in the
11 conservation easement
and one of the provisions, that the
12 State will have right
of first refusal.
13
THE GOVERNOR: Rayonier has the right of first
14 refusal, don't
they?
15
MR. GARDNER: Well, and I'll get to that in a second,
16 if I may.
17
CFO GALLAGHER: Who gets the right of first refusal
18 second?
19
MR. GARDNER: Well, that was an issue that was raised
20 in the process.
And right now, under the agreement with
21 Rayonier, there are
two provisions for sale. If they sell
22 the property among
their families, there is no Rayonier
23 right of first
refusal. If they sell to someone outside
24 the family, Rayonier
has the right of first refusal. The
25 owners have
committed. The Department can put a
provision
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1 in the conservation
easement that they will not sell to
2 anyone except family
members during the next 12 1/2 years,
3 therefore preserving
the State's right of first refusal.
4 There were some other
issues.
5
THE GOVERNOR: The family will commit not to sell the
6 property during the
time Rayonier has -- that Rayonier's
7 lease is --
8
MR. GARDNER: 12 years and four months. After that,
9 Rayonier has no right
to the property whatsoever except to
10 get off the property
whatever they may have on the
11 property.
12
THE GOVERNOR: So at the end of their lease if they
13 haven't -- their
right of first refusal is during the time
14 there is not -- it's
during their lease?
15
MR. GARDNER: That is correct. And it's not at the
16 end of the lease.
17
THE GOVERNOR: That does protect the State from
18 having Rayonier
intervene?
19
MR. GARDNER: That is correct.
20
THE GOVERNOR: What happens if Rayonier wanted to buy
21 the property?
22
MR. GARDNER: Well, they can't buy the property
23 unless the owners
want to sell it to them. If the owners
24 give the State the
right --
25
THE GOVERNOR: So Rayonier will be part of
that
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1 commitment as
well?
2
MR. GARDNER: Well, Rayonier has no right to buy the
3 property. There
is no right in the lease that gives
4 Rayonier the right to
buy that property.
5
THE GOVERNOR: Help me out here. I'm just trying to
6 bring clarity.
7
MR. GARDNER: Right. Rayonier does not have a
8 right --
9
THE GOVERNOR: I'm not arguing with you, I'm just
10 trying to use my
means to advance your case a little bit.
11
MR. GARDNER: Well, I appreciate that.
12
THE GOVERNOR: Okay. Good. So during the 12 1/2
13 year period we would
have -- there would not be a sale of
14 this property and
they would be willing to commit to that
15 in the easement.
16
MR. GARDNER: Except the family members which does
17 not give Rayonier
right of first refusal.
18
THE GOVERNOR: And they would have the same
19 limitations on them
as well, family members.
20
MR. GARDNER: Well, the conservation easement would
21 be binding on the
owners. There are a number of things.
22 According to the
lease, and I really wasn't going to get
23 into this right off,
but according to the lease --
24
THE GOVERNOR: This is important.
25
MR. GARDNER: The grantor, who is the owner, has
the
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1 right to all the
minerals, oil, gas, minerals, not the
2 grantee, the timber
company. The only thing the timber
3 company has is that
the grantor may ask to mine and the
4 grantee cannot
unreasonably withhold approval. And if
5 they ask and they're
approved, they share the royalties
6 only for the term of
the lease.
7
THE GOVERNOR: And what is the grantor willing to do
8 to commit to in that
regard?
9
MR. GARDNER: Well, the grantor, in the conservation
10 easement, gives the
State -- gives up all its rights to
11 mine, an issue that
you-all discussed. And believe me,
12 phosphate mining is a
big issue in that area. If you look
13 at some of the
writeups on the threats to this property,
14 phosphate mining is a
threat.
15
THE GOVERNOR: What I'm confused about, Colleen, it
16 sounds like the
Department has done a very good job
17 protecting -- given
the unique circumstances, which
18 happens, and every
transaction is a little bit
19 different --
Department has done a good job protecting the
20 resource and its
negotiation. Now you want to withdraw
21 it.
22
MS. CASTILLE: This isn't our negotiation. What he's
23 referring to is the
negotiation between the property owner
24 and Rayonier, not
us.
25
MR. GARDNER: No, that's not
true.
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1
CFO GALLAGHER: He's talking about with us.
2
MR. GARDNER: Let me just try to go through the
3 negotiation process on
this conservation easement and it's
4 a continual
process. There were questions raised at the
5 last cabinet meeting
that this was discussed in May and
6 they relate to rump
rocks. But basically the owners have
7 agreed to everything
that the State has presented to them
8 on three and four and
five occasions, even up to the last
9 modification that goes
back only a couple weeks.
10
THE GOVERNOR: Tom, I apologize but there are two
11 people in this room
that have not been able to take care
12 of business in the
last -- since 9:00 and that's the court
13 reporter and the
Governor. And the court reporter would
14 like a break if you
wouldn't mind. It's 12:15. Five
15 minutes.
16
(Brief recess.)
17
THE GOVERNOR: Thank you-all for your patience.
18 Colleen, it seems to
me that there's a lot of issues yet
19 to be worked out
here. And rather than withdraw this
20 item, I would
suggest, if you concur, that we defer this
21 item so that we can
discuss values, make sure that --
22 sounded like there's
a little bit of he said/she said
23 stuff that could be
worked out. And this is an important
24 part of the State's
strategies to protect the natural
25 systems. Sounds
like the
--
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1
CFO GALLAGHER: I gather you want to do that with 12
2 also?
3
MS. CASTILLE: Could we do it for two meetings?
4 Could we defer it for
two meetings?
5
THE GOVERNOR: Sure, I --
6
MS. CASTILLE: No, we don't want to defer it for two
7 meetings.
8
THE GOVERNOR: Just defer it open-ended until you get
9 the --
10
MS. CASTILLE: Oh, we need another appraisal so we're
11 going to have to
defer it until November.
12
CFO GALLAGHER: This will include 12?
13
MS. CASTILLE: No, sir.
14
MR. HILSENBECK: There's no lease on 12.
15
THE GOVERNOR: Twelve is good to go.
16
CFO GALLAGHER: Okay. Move to defer 12.
17
MS. CASTILLE: No, 11.
18
CFO GALLAGHER: Move to defer 11.
19
COMMISSIONER BRONSON: Second.
20
THE GOVERNOR: There's a motion and a second.
21 Without objection,
the item is deferred.
22
CFO GALLAGHER: And that's until a lease is received.
23
THE GOVERNOR: Appraisal.
24
MS. CASTILLE: Appraisal.
25
CFO GALLAGHER: I'm sorry, until the appraisal
is
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1 received.
2
THE GOVERNOR: Let's make this a high priority given
3 how long people have
been waiting. And for whatever
4 reason, this lease was
not a -- somehow, I don't see how
5 that was not factored
in the beginning but it wasn't. So
6 the sooner the
better.
7
MS. CASTILLE: We will.
8
THE GOVERNOR: Okay. Item 12.
9
MS. CASTILLE: Item 12 is the consideration of an
10 option agreement to
acquire perpetual conservation
11 easement over 923
acres in Pinhook Swamp and the purchase
12 price of the easement
is $636,000 which is 54 percent of
13 fee value.
There are no leases on this property. And we
14 are -- BOT is
purchasing the hardwood in the natural areas
15 and the seller is
retaining the planted pines in the
16 silviculture
areas. And there are 600 acres in
17 silviculture.
18
CFO GALLAGHER: Colleen, I don't have the numbers
19 here, but I'm trying
to figure out something. It says
20 here 930 acres were
purchased for $1,224 an acre in 2002.
21 And now what do we
have? Our fee value is 1292 an acre?
22
MS. CASTILLE: Yeah, our fee value is 1292 an acre.
23
CFO GALLAGHER: And we're paying 689, right?
24
MS. CASTILLE: And we're paying 689.
25
CFO GALLAGHER: So 54 percent. Now we got all
our
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1 mining prohibited and
those kinds of things?
2
MS. CASTILLE: I'm not sure what the mining is on
3 this one.
4
MR. RICHMOND: Ron Richman again. Yes, you have all
5 the mining
rights. You have row crops. You have
6 everything. You
have cypress trees. We don't get to take
7 those anymore.
8
CFO GALLAGHER: And commercial agriculture is out.
9
MS. CASTILLE: Yes.
10
CFO GALLAGHER: The only thing left is silviculture,
11 right?
12
MS. CASTILLE: Yes.
13
MR. RICHMOND: Right.
14
COMMISSIONER BRONSON: And that is part of
15 agriculture.
16
CFO GALLAGHER: I know, but it is accepted.
17 Commercial
agriculture activities will be prohibited on
18 the property except
to the extent that silviculture
19 activities may be
considered to be agricultural.
20
MR. RICHMOND: What we have retained, our
21 silviculture and the
right to plant so many food plots for
22 hunting. And we
have the right to put up two hunting
23 camps.
24
CFO GALLAGHER: On the silviculture on this, is this
25 one where you take
down the short leaf pine, you
replace
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1 it with long leaf?
2
MR. RICHMOND: That doesn't say that in there. I
3 don't know how they'll
do it.
4
COMMISSIONER BRONSON: I don't think this one
5 specifically calls for
that. It just means they can
6 harvest their trees at
some point in time.
7
THE GOVERNOR: Sounds like a well-negotiated lease to
8 me. Any other
questions? There's a motion, I believe.
9
CFO GALLAGHER: I'll move it.
10
COMMISSIONER BRONSON: Second.
11
THE GOVERNOR: Motion and a second. Any other
12 discussion?
13
Without objection, the item passes.
14
MS. CASTILLE: Governor, Item 13 is a presentation of
15 a status report on
our acquisition efforts as part of our
16 agreement with the
local communities in Monroe County in
17 the Keys and I'd like
to have Eva give that quick
18 presentation.
19
MS. ARMSTRONG: Good morning. I thought I'd make
20 this really
brief. As you'll recall, it was about a year
21 ago that in
coordination with the legislative committees
22 that met in the Keys,
we made a commitment that we would
23 speed up our
acquisition efforts in the Florida Keys to
24 try to get all the
three conservation projects down there
25 fully bought by the
end of 2006. We have secured
a
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1 contract with American
Government Services which is one of
2 our real estate
contractors to act as project manager for
3 us. They've been
working for us for about six months on
4 this effort. A
lot of upfront research first. But they
5 have now put out a
total of 1942 first offers, 30 second
6 offers, and as you can
see, we've got 140 contracts in
7 hand with 7 percent of
those offers accepted. We had 180
8 responses which
doesn't sound like a lot of responses so
9 far. But again
we had a lot of up-front research we had
10 to get.
11
A number of the parcels had changed hands over time
12 so we had a lot of
research to catch up with new owners,
13 people had
died. So they had a lot of research to do.
14 But the good news
here, which I pointed this out to the
15 cabinet aides as
well, was they gave us some information.
16 75 percent indicated
that the offers were too low. That's
17 good news because it
means that those people are willing
18 to sell at the right
price. So we think we're on the
19 right track here.
20
We've had several boundary amendments. You approved
21 a couple of the last
round. We're working on one more
22 boundary amendment
that will be probably December before
23 we bring that to
you. We're trying to refine it down to
24 the accurate acreage
before we bring it forward. So with
25 that, if you don't
have any questions, that would be it
at
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1 the moment.
We'll give you another one after the first of
2 the year.
3
THE GOVERNOR: Any comments? Questions?
4
COMMISSIONER BRONSON: Move to accept the report.
5
CFO GALLAGHER: Second.
6
THE GOVERNOR: There's a motion and a second to
7 accept the
report. Passes without objection.
8
Item 14.
9
MS. CASTILLE: Item 14 is a status report on the use
10 of private real
estate firms to improve our efficiency for
11 acquisitions.
Governor and members of the cabinet, this
12 is a -- we have only
been in about six months of this
13 process even though
we contracted with these folks over a
14 year ago or close to
a year ago. But we've actually been
15 utilizing them in the
Keys acquisition as well as some
16 other research and
analysis that we're doing.
17
I'm sorry, this is very loud. And I just want to
18 give you a simple
overview. We passed out a salary
19 compensation sheet
that I want to clarify some issues on
20 here because it's not
clear. What we're evaluating, and
21 we only have a short
amount of time to evaluate this, but
22 this one document
does not have everything that it needs
23 to have in it.
If you look at the top three -- the top
24 three -- well, what
we did was we contracted with eight
25 different firms to
provide various real estate
services
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1 for us. AGS,
Post, Buckley, Dahill, TNC, The Nature
2 Conservancy, Florida
Acquisition and Appraisal Services,
3 Finlayson, and Urban
Group and O.R. Colan and Group.
4
These various folks have been contracted to us to do
5 various real estate
service. What we did with AGS,
6 American Government
Services, was to contract with them to
7 do this Keys
acquisition. The document before you which
8 has three columns on
the top of it, current annual state
9 employee, current
annual contracted salary for the three
10 projects, and
comparison to actual Save Our Everglades
11 average salary over
the last ten years.
12
If you look at those bottom line figures, they are
13 not completely clear
as to what we are actually getting
14 from our contracted
folks. If you look at the annual
15 costs of three folks
who do these similar type of
16 services, it's
$178,000 and that's inclusive of rent,
17 electricity, all of
the new issues, the indirect costs
18 that we've been
looking at for our privatization efforts.
19
And then if you look at the current annual contracted
20 salary for the three
Keys projects, it says 320,000. But,
21 in fact, what we get
from those three employees is
22 everything from soup
to nuts whereas the three senior
23 employees on the
left-hand side strictly do the
24 acquisition.
What the applicant does is far more than
25 what those three
employees do. And what we intend to
do
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1 is to amend this to
include the cost of the other
2 employees who are --
who are doing the other list of items
3 that are included in
the acquisition.
4
THE GOVERNOR: But, Colleen, why would you present it
5 to us in an apple to
pear way? Why don't you present it
6 to us in an apple to
apple way?
7
MS. CASTILLE: Well, I was going to except I just saw
8 it this morning and
did not realize what was passed out
9 this morning. So
I'm trying to take a document that I
10 know you have and let
you understand what's in it and
11 what's not in it.
12
CFO GALLAGHER: I look at it like this. What you
13 have is you have the
three State employees and totalled
14 up. It looks to
me is they are still doing their job,
15 which is important,
they're carrying out what they are
16 doing. And that
the contracted people that we've added
17 means that we're
processing at least twice as much in
18 regards to this
program. So what -- you know, trying to
19 compare one is
cheaper than the other, it costs more, what
20 counts is that we're
getting twice as much done, we're
21 using outside people
to get it done and we ought to brag
22 that it's not costing
that much more.
23
MS. CASTILLE: Well, it's not costing more at all.
24 We're getting twice
as much done and they take the project
25 from soup to nuts,
they do the whole project
management.
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1
THE GOVERNOR: Rather than give us a report that
2 doesn't accurately
--
3
CFO GALLAGHER: Come back.
4
MS. CASTILLE: That's what I'd like to do, is to come
5 back with the apples
to apples comparison. Okay?
6
THE GOVERNOR: All right. Is there an action
7 necessary on this?
8
CFO GALLAGHER: No, we're not accepting it.
9
THE GOVERNOR: Very good. Thank you.
10
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1
THE GOVERNOR: State Board of Administration.
2
GENERAL CRIST: Motion on 1.
3
CFO GALLAGHER: Second on the minutes.
4
THE GOVERNOR: There's a motion and a second.
5 Without objection,
Item 1 passes.
6
MR. STIPANOVICH: Item No. 2 is a request for
7 approval of fiscal
sufficiency of an amount not exceeding
8 65 million State of
Florida --
9
CFO GALLAGHER: Motion on 2.
10
GENERAL CRIST: Second.
11
THE GOVERNOR: There's a motion and a second.
12 Without objection,
the item passes.
13
MR. STIPANOVICH: Item No. 3 is a staff
14 recommendation to
adopt the following administrative
15 rules. This
same rule package was brought to you back in
16 May and if you have
any questions, I'd be happy to answer
17 them.
18
CFO GALLAGHER: Motion on 3.
19
GENERAL CRIST: Second.
20
THE GOVERNOR: Moved and seconded. Without
21 objection, the item
passes.
22
CFO GALLAGHER: Thank you, Coleman.
23
(Thereupon, the proceedings adjourned at 12:35 p.m.)
24
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1
2
CERTIFICATE OF REPORTER
3
4 STATE OF FLORIDA )
5 COUNTY OF LEON )
6
7
I, KRISTEN L. BENTLEY, Court Reporter, certify that
8 the foregoing proceedings were taken before me at
the time and
9 place therein designated; that my shorthand notes
were
10
thereafter translated under my supervision; and the foregoing
11
pages numbered 1 through 136 are a true and correct record of
12
the aforesaid proceedings.
13
14
I further certify that I am not a relative, employee,
15
attorney or counsel of any of the parties, nor am I a relative
16
or employee of any of the parties' attorney or counsel
17
connected with the action, nor am I financially interested in
18
the action.
19
DATED this 13th day of September, 2004.
20
______________________________
21
KRISTEN L. BENTLEY, Court
Reporter
Notary Public
22
850-878-2221
23
24
25
ACCURATE STENOTYPE REPORTERS,
INC.
.