AGENDA

BOARD OF TRUSTEES OF THE INTERNAL IMPROVEMENT TRUST FUND

APRIL 10, 2001

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Item 1 Minutes

Submittal of the Minutes from the February 27, 2001 Cabinet Meeting.

RECOMMEND APPROVAL

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Item 2 Indian River County Option Agreement/Sebastian Creek CARL Project

REQUEST: Consideration of an option agreement to acquire 95.38 acres within the Sebastian Creek CARL project from Indian River County.

COUNTY:  Indian River

LOCATION:  Sections 14 and 23, Township 31 South, Range 38 East

CONSIDERATION:  $476,240 (The Board of Trustees’ 50 percent share of the lowest revised value of $952,480)

* New approved value based on revised acreage calculations.

** Mr. Fischer had owned the property since the 1970s.

*** The BOT’s 50 percent share of the lowest revised value, due to the non-exclusive management easement.

STAFF REMARKS: The Sebastian Creek CARL project was ranked number 5 on the CARL Substantially Complete Project List approved by the Board of Trustees on February 9, 1999, and was removed from the 2000 CARL list because the project was 90 percent complete. The project is funded under the Division of State Lands’ (DSL) Land Acquisition Workplan as a 90 percent complete project and is eligible for acquisition pursuant to section 259.032(8), F.S. The project contains 22,493 acres, of which 20,834 have been acquired. After the Board of Trustees approves this agreement, 1,563.62 acres, or seven percent of the project, will remain to be acquired.

Pursuant to the terms of the multi-party acquisition agreement entered into between DSL and Indian River County (County), the Board of Trustees’ purchase price for the property shall be the lesser of an amount equal to 50 percent of the purchase price plus 50 percent of the closing costs incurred in the acquisition of the parcel; or 50 percent of the maximum value of the parcel acquired in the project plus 50 percent of the closing costs incurred in the acquisition of the parcel. Title to the property acquired will vest in the Board of Trustees. The County purchased the Fischer parcel, consisting of 95.38 acres, on January 2, 1997, for $1,490,000, which was, at that time, the appraised value of the property. Prior to closing, a discrepancy between the appraised and actual upland and wetland acreage was discovered by the County. In an effort not to hold up the closing and to protect against a decrease in value, the parties agreed to escrow $89,400 from the closing proceeds with the understanding that a revised appraisal was necessary. The revised appraised value was $1,210,000 and the escrowed money was returned to the County. Although the County received the escrowed funds, the final purchase price was $190,600 above the revised appraised value. Pursuant to the terms of the multi-party acquisition agreement, the County is only seeking reimbursement of 50 percent of revised appraised value plus 50 percent of the closing costs incurred in the acquisition of the parcel.

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Agenda – April 10, 2001

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Item 2, cont.

In transactions involving local governments, it has been the long-standing practice of the Board of Trustees to insist on unencumbered, fee simple title to the lands it acquires under the CARL program. This policy is based upon the fact that the CARL program is a state initiative with its goal being state ownership and control. Permitting other entities to hold an interest in the title or insist on deed restrictions raises the possibility of management conflicts in the future. The Board of Trustees will hold a 100 percent title interest.

On February 28, 1998, in another joint acquisition with the County, the Board of Trustees approved a partial assignment of an option agreement in which the right of re-entry was granted. In this case, the County is contributing 50 percent of the purchase price and is using the proceeds of a local bond issue for its share. The County’s bond counsel has advised that it may only use bond proceeds if it obtains some interest in the property being acquired. The Department of Environmental Protection (DEP) recommends that the Board of Trustees grant the County a right of re-entry during the time the bonds are outstanding if the property is either sold or converted to another use. This right of re-entry language is identical to what was granted by the Board of Trustees previously and is acceptable to the County’s bond counsel.

On August 22, 2000, the Board of County Commissioners of Indian River County approved the proposed conveyance of this parcel to the Board of Trustees for $605,000. On February 20, 2001, the Board of County Commissioners of Indian River County approved an amendment to the option agreement with the Board of Trustees. The amendment will require the County to grant the Board of Trustees a non-exclusive ingress and egress easement to the southerly portion of the property prior to closing. This will provide legal access to the property through adjacent property owned by the County.

While reviewing the transaction for presentation to the Board of Trustees, DSL staff found a title matter that could further affect the value of the property. The County negotiations had included the acquisition of a non-exclusive access easement to the northerly portion of the parcel. The easement was to allow access to 24 acres of the 95.38-acre parcel, and runs through a portion of the partially-developed, private subdivision not being purchased by the state. The seller was concerned about public access through the developed portion of the subdivision and insisted that the non-exclusive easement be limited to use for management purposes only. The County accepted this type of easement, as the property is adjacent to state-owned lands and there would not be a problem providing access to the property; however, the County did not realize that its acceptance could have an adverse effect on market value. DEP’s Office of Coastal and Aquatic Managed Areas (CAMA), the future managing agency, has stated that the limited access easement does not present a problem in managing the property.

While not a concern for management, the easement does raise concerns regarding the value of the property. Consultations with the appraisers have determined that the easement affects the market value negatively and restricts the use of the property served by the easement much like a conservation easement would. While not an actual appraisal, the appraiser, whose value represents the statutory maximum value, has indicated a further reduction in value to as low as $952,480 because of the management easement. On April 3, 2001, the Board of County Commissioners of Indian River County approved an amendment to the option agreement agreeing to be compensated based on this value.

All mortgages and liens will be satisfied at the time of closing. On June 22, 1999, the Board of Trustees approved a staff recommendation to delegate to DEP the authority to review and evaluate marketability issues as they arise on all chapter 259, F.S., acquisitions and to resolve

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Agenda – April 10, 2001

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Item 2, cont.

them appropriately. Therefore, DEP staff will review, evaluate and implement the most appropriate resolution for any title issues that arise prior to closing.

A title insurance policy, a survey and an environmental site assessment will be provided by the County prior to closing. The Board of Trustees will reimburse the County 50 percent of the cost of the title insurance policy, the survey and the environmental site assessment, contingent on the closing of this transaction.

Sebastian Creek, one of the most important aggregation sites for the endangered manatee on Florida’s east coast, is surrounded by a large island of natural flatwoods, marshes, swamps, and scrub in a sea of agriculture and housing. Public acquisition of the Sebastian Creek CARL project will protect the manatee and the water quality of the creek by protecting the natural lands in the creek basin and will give the residents of the fast-growing cities of Brevard and Indian River Counties a large area of fishing, hiking, and other pursuits.

This property will be managed by CAMA as part of the St. Sebastian River Buffer Preserve.

This acquisition is consistent with section 187.201(10), F.S., the Natural Systems and Recreational Lands section of the State Comprehensive Plan.

(See Attachment 2, Pages 1-52)

RECOMMEND APPROVAL

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Item 3 Krantz Option Agreement/Rookery Bay CARL Project

REQUEST:  Consideration of an option agreement to acquire 20.01 acres within the Rookery Bay CARL project from Harold E. and Gwen Krantz.

COUNTY:  Collier

LOCATION:  Section 10, Township 51 South, Range 26 East

CONSIDERATION:  $ 600,000

* Acquired in 1965

STAFF REMARKS: The Rookery Bay CARL project was ranked number 4 on the CARL Substantially Complete Project List approved by the Board of Trustees on February 9, 1999, and was removed from the 2000 CARL list because the project was 90 percent complete. The project is funded under the Division of State Lands’ Land Acquisition Workplan as a 90 percent complete project, and is eligible for acquisition pursuant to section 259.0332(8), F.S. The project contains 20,231 acres, of which 18,557.61 acres have been acquired or are under agreement to be acquired. After the Board of Trustees approves this agreement, 1,653.38 acres, or eight percent of the project, will remain to be acquired.

Board of Trustees

Agenda – April 10, 2001

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Item 3, cont.

All mortgages and liens will be satisfied at the time of closing. On June 22, 1999, the Board of Trustees approved a staff recommendation to delegate to the Department of Environmental Protection (DEP) the authority to review and evaluate marketability issues as they arise on all chapter 259, F.S., acquisitions and to resolve them appropriately. Therefore, DEP staff will review, evaluate and implement the most appropriate resolution for any title issues that arise prior to closing.

A title insurance policy, an environmental site evaluation and, if necessary, an environmental site assessment will be provided by the purchaser prior to closing.

Rookery Bay is an outstanding subtropical estuary in the fastest growing part of Florida. Its mangroves shelter important nesting colonies of water birds, and feed and protect many aquatic animals. These animals in turn, are the foundation of commercial and recreational fisheries. Public acquisition of the Rookery Bay CARL project will protect the bay’s water quality and its native plants and animals, and will provide recreational opportunities to the people of southwest Florida. As an addition to the Rookery Bay National Estuarine Research Reserve, the project will also further coastal ecosystem research and environmental education.

The property will be managed by DEP’s Office of Coastal and Aquatic Managed Areas as part of the Rookery Bay National Estuarine Research Reserve.

This acquisition is consistent with section 187.201(10), F.S., the Natural Systems and Recreational Lands section of the State Comprehensive Plan.

(See Attachment 3, Pages 1-27)

RECOMMEND APPROVAL

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Item 4 Zemel/Amoni Option Agreements/Charlotte Harbor Flatwoods CARL Project

REQUEST:  Consideration of two option agreements to acquire 289.1 acres within the Charlotte Harbor Flatwoods CARL project from Morton B. Zemel, Trustee and Marco and Antoinette Amoni.

COUNTY:  Lee

LOCATION:  Sections 08 and 22, Township 43 South, Range 23 East

CONSIDERATION:  $984,179

* Acquired in 1988.

** Acquired in 1979.

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Agenda – April 10, 2001

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Item 4, cont.

STAFF REMARKS: The Charlotte Harbor Flatwoods CARL project is ranked number 10 on the CARL Priority Project List approved by the Board of Trustees on February 22, 2000, and is eligible for negotiation under the Division of State Lands’ Land Acquisition Workplan. The project contains 19,361 acres, of which 13,591.87 acres have been acquired or are under agreement to be acquired. After the Board of Trustees approves these agreements, 5,480.03 acres, or 28 percent of the project, will remain to be acquired.

All mortgages and liens will be satisfied at the time of closing. On June 22, 1999, the Board of Trustees approved a staff recommendation to delegate to the Department of Environmental Protection (DEP) the authority to review and evaluate marketability issues as they arise on all chapter 259, F.S., acquisitions and to resolve them appropriately. DEP staff will review, evaluate and implement the most appropriate resolution for any title issues that arise prior to closing.

Surveys, title insurance policies, environmental site evaluations and, if necessary, environmental site assessments will be provided by the purchaser prior to closing.

Northwest of Fort Myers lies the largest and highest-quality slash-pine flatwoods left in southwest Florida. The pines are home to red-cockaded woodpeckers, black bears, and bald eagles, and an occasional Florida panther ranges the area. The largest population in the world of the rare beautiful pawpaw grows here. Several drainage ditches flow through these flatwoods into the Charlotte Harbor Aquatic Preserve. Public acquisition of the Charlotte Harbor Flatwoods CARL project will protect these flatwoods and connect the Charlotte Harbor State Buffer Preserve with the Babcock/Webb Wildlife Management Area, helping to protect both of these managed areas and the waters of the aquatic preserve.

The properties will be managed by the Florida Fish and Wildlife Conservation Commission as part of the Babcock/Webb Wildlife Management Area.

These acquisitions are consistent with section 187.201(10), F.S., the Natural Systems and Recreational Lands section of the State Comprehensive Plan.

(See Attachment 4, Pages 1-55)

RECOMMEND APPROVAL

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Item 5 SJRWMD/DACS/DOF Acquisition Agreement/Jennings State Forest Additions Project

REQUEST: Consideration of (1) authorization to enter into an acquisition agreement with St. Johns River Water Management District and the Florida Department of Agriculture and Consumer Services, Division of Forestry, for the Jennings State Forest Additions Project; and (2) authorization to acquire an undivided 50 percent interest in 1,451 acres within the Jennings State Forest Additions Project from five separate owners.

COUNTIES: Clay and Duval

Review Number 010605

APPLICANT: Department of Agriculture and Consumer Services, Division of Forestry (DOF)

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Agenda – April 10, 2001

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Item 5, cont.

LOCATION: Sections 20, 29, 32 and 33, Township 03 South, Range 24 East

CONSIDERATION: $2,155,200 (Board of Trustees’ 50 percent share of the $4,310,400 purchase price)

STAFF REMARKS: The Jennings State Forest Additions Project is eligible for funding under the DOF Preservation 2000 Additions and Inholdings Program. The proposed agreement covers approximately 3,322 acres.

To facilitate the acquisition of this project, the St. Johns River Water Management District (District) has taken the lead in the acquisition of this joint project. The Department of Environmental Protection (DEP) and DOF have prepared an agreement that would allow the District to acquire the Jennings State Forest Additions in accordance with section 259.041(17), F.S., utilizing the procedures set out in section 373.139, F.S. On September 13, 1994, the Board of Trustees approved the use of the District's procedures to allow the District to acquire lands to be held jointly by the Board of Trustees and the District.

The Governing Board of the District adopted Resolution Numbers 2001-07, 2001-08, 2001-09, 2001-10 and 2001-11 on December 14, 2000, and has executed the acquisition agreement. Upon Board of Trustees' approval, DEP staff will execute the agreement on behalf of the Board of Trustees.

Incorporated into the agreement are a number of assurances that the District is giving the Board of Trustees in return for its consideration of this agreement. The District has agreed to: (1) comply with the procedures set out in section 373.139, F.S.; (2) defend the Board of Trustees against all title and survey disputes or defects and environmental contamination associated with each acquisition negotiated by the District that were either known or should have been known by the District at the time the District acquired the parcel; and (3) reimburse the Board of Trustees 50 percent of any overpayment of the purchase price if an audit or investigation determines that the purchase price paid exceeded the actual appraised value.

Pursuant to the proposed agreement, District staff has obtained and reviewed appraisals; negotiated purchase contracts with Timber Forest Trail Investments, LLC, Yellow Water Investments, LLC, Cochise Pines Investments, LLC, Black Timber Investments, LLC, and Longleaf Timber Investments, LLC; and secured the approval of its Governing Board. The District has provided DEP’s Division of State Lands and DOF with a board resolution requesting reimbursement of the Board of Trustees' share of the purchase price. DEP staff is seeking approval for DOF’s share of the purchase price for each parcel the District contracted to purchase. DOF will fund its share of the acquisition costs for each parcel from its Preservation 2000 funds. In addition, the agreement provides for the District to be reimbursed by DOF 50 percent of all costs associated with its attempt to acquire lands within the project, including all pre-acquisition and closing related costs, with the pre-acquisition costs and certain closing costs being reimbursed even if the District is unsuccessful in acquiring any property. The agreement authorizes DOF to reimburse these costs. If the Board of Trustees approves these purchases, the District will proceed to closing with title to be vested jointly, with the District and the Board of Trustees with each holding an undivided 50 percent interest.

This property provides a desirable management and habitat connector between Cecil Field Naval Air Station and Jennings State Forest, areas currently managed by DOF. The landscape is predominantly a mosaic of pre-merchantable pine plantations, located on historical sandhill and flatwood community types, and is dissected by three drainage creeks that support a mature hardwood forest.

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Agenda – April 10, 2001

Substitute Page Seven

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Item 5, cont.

The property will be managed by DOF as part of the Jennings State Forest.

This acquisition is consistent with section 187.201(10), F.S., the Natural Systems and Recreational Lands section of the State Comprehensive Plan.

(See Attachment 5, Pages 1-118)

RECOMMEND APPROVAL

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Substitute Item 6 Eminent Domain Authorization/Delegation of Authority/Golden Gate Estates/Save Our Everglades (Phases III and IV) CARL Project

REQUEST:  Consideration of a request to (1) direct the Department of Environmental Protection to acquire fee simple title to all remaining land within the portion of the Save Our Everglades CARL project (Phases III and IV) lying south of I-75 on which two bona fide offers have been made by the exercise of the power of eminent domain pursuant to the provisions of chapters 259, 73 and 74, F.S.; and (2) delegate authority to the Secretary of the Department of Environmental Protection to accomplish the acquisition as described herein through negotiation or condemnation, including authority to prepare and execute all necessary parcel-specific condemnation resolutions.

COUNTY:  Collier

STAFF REMARKS: The Save Our Everglades CARL project is ranked number 3 on the CARL Mega/Multiparcel Project List approved by the Board of Trustees on February 22, 2000, and is eligible for negotiation under the Department of Environmental Protection (DEP), Division of State Lands’ (DSL) Land Acquisition Workplan. That portion of the project lying south of I-75, commonly referred to as Golden Gate Estates South, contains 55,566.2 acres, of which 47,116 acres have been acquired or are under agreement to be acquired, leaving 8,450.2 acres, or 15 percent, remaining to be acquired. The Golden Gate Estates South portion of this project includes the Southern Golden Gate Estates subdivision and surrounding acreage tracts bordered by I-75 to the north, US-41 to the south and the Fakahatchee Strand and Belle Meade CARL projects to the east and west, respectively.

On January 23, 2001, the Board of Trustees recognized that (1) property within the Save Our Everglades CARL project lying south of I-75 is of special importance to the state; (2) the acquisition of the land is necessary to protect hydrological connections among Big Cypress National Preserve, Fakahatchee Strand State Preserve, and Everglades National Park, and to protect and restore the Everglades, which is an endangered natural resource of unique value to the state; and (3) the failure to acquire this property will result in irreparable loss to the state and seriously impair the state’s ability to manage or protect other state-owned lands. DEP has been directed to proceed with the acquisition of the parcels in Phases I and II.

Public acquisition is essential to continue the conservation, preservation and restoration of this endangered portion of the western Everglades ecosystem that is a vital component of the Comprehensive Everglades Restoration Plan (CERP). Conserving this land is critical to the ecosystem in the western Everglades, its wildlife and the water quality throughout the area.

In 1996, the hydrological restoration plan was identified as a "Critical Project" under the Federal Water Resources Development Act making it eligible for federal funds. The project

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Substitute Item 6, cont.

was subsequently added to CERP.

The acquisition will allow the restoration of significant wetlands crucial to the reestablishment of the historic water flow pattern in the western Everglades. Nearly half of this region's water flows into Everglades National Park.

Purchasing this portion of the Save Our Everglades CARL project will also help preserve and restore the fresh water flow necessary for maintaining the rich productivity of Gulf Coast estuaries, such as Rookery Bay and the Ten Thousand Islands. Moreover, the timely implementation of the hydrological restoration plan will restore important habitat for numerous endangered and threatened species, including the Florida panther, one of the world's most endangered mammals.

Public acquisition of this portion of the Save Our Everglades CARL project will preserve a large piece of South Florida's unique ecosystem. Ultimately, this will contribute to the formation of a continuous public conservation corridor extending across South Florida from the Gulf Coast to approximately ten miles from the Atlantic Ocean. It will help protect the western Everglades ecosystem from encroachment of residential, commercial and industrial development.

In 1999, the Big Cypress Basin Board advised DEP that the hydrologic restoration was scheduled to commence as early as October 2002, and 100 percent public ownership would be required. After multiple rounds of appraisals and offers over the last fifteen years, nearly 4,000 parcels in Southern Golden Gate Estates and the surrounding area still remain to be acquired. Due to the relatively large number of remaining parcels, a plan was developed to increase the percentage of parcels acquired by voluntary means while assuring that all lands are acquired by October 2002. The first step in the plan was to seek authority from the Board of Trustees to offer amounts in excess of the appraised value in an effort to acquire as much property as possible without having to resort to the use of eminent domain. On July 11, 2000, the Board of Trustees authorized the Director of DSL, or her designee, to extend bona fide offers and approve any contract for the sale and purchase of land at $5,000 over or up to 125 percent of the appraised value, whichever is greater, when the purchase price per parcel does not exceed $50,000, and at up to 125 percent of the appraised value when the purchase price per parcel exceeds $50,000.

In anticipation that a substantial portion of the remaining parcels will still require the use of eminent domain to assure that all lands are in public ownership by the time the restoration is to begin, preliminary meetings have been held with the Chief Judge in Collier County. Current projections are that it may take nearly two years to process the parcels that cannot be acquired voluntarily through the court system of Collier County. To assure a constant flow of parcels to the Office of the Attorney General, the plan contemplates the processing of parcels in multiple phases over the next 18 months.

On the advice of the Office of the Attorney General, appraisals were updated to assure that offers would satisfy the bona fide offer requirement and second bona fide offers were tendered to the 326 owners (339 parcels) in Phase III on January 29, 2001, and to the 368 owners (386 parcels) in Phase IV on February 20, 2001. The initial mailing and follow-up negotiations with the owners within Phase III resulted in the successful negotiation and approval of contracts for 136 of the 339 parcels or 40 percent of Phase III. Negotiations for the acquisition of the 203 remaining parcels in Phase III have reached an impasse; however, the bona fide offer requirement of section 259.041(14), F.S., has been satisfied. The initial mailing and follow-up negotiations with the owners within Phase IV resulted in the successful negotiation and approval of contracts for 137 of the 386 parcels or 35 percent of Phase IV. Negotiations

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Substitute Item 6, cont.

for the acquisition of the 249 remaining parcels in Phase IV have reached an impasse; however, the bona fide offer requirement of section 259.041(14), F.S., has been satisfied. In the event one or more of the parcels placed under contract cannot close for any reason, the authority requested today covers all 725 parcels in Phases III and IV. Parcels under contract will be held by DSL and only parcels that have reached impasse or parcels that cannot be closed by voluntary means will be turned over to the Office of the Attorney General.

Section 259.041(14), F.S., authorizes the Board of Trustees, by majority vote of all of its members, to direct DEP to exercise its power of eminent domain pursuant to the provisions of chapters 73 and 74, F.S. Eminent domain may be used to acquire any of the property on the CARL priority list if (1) the state has made at least two bona fide offers to purchase the land through negotiation and an impasse between the state and the land owner has been reached; and (2) the land is of special importance to the state because (a) it involves an endangered or natural resource and is in imminent danger of being developed; (b) it is of unique value to the state and failure to acquire the property would constitute an irreparable loss to the state; or (c) the failure to acquire the property would seriously impair the state's ability to manage or protect other state-owned lands.

The parcels included in Phases III and IV of the Save Our Everglades project lying south of I-75 meet these criteria: (1) the state has made at least two bona fide offers and has been unable to acquire these parcels through negotiation; and (2) in section 373.4592(1), F.S., the legislature has recognized that the Everglades ecological system is unique in the world and one of Florida’s great treasures. They also recognize that the CERP is important for restoring the Everglades ecosystem and sustaining the environment, economy, and social well being of South Florida. The Everglades ecological system is endangered as a result of adverse changes in water quality, and in the quantity, distribution, and timing of flows and, therefore, must be restored and protected. The hydrological restoration of these lands is an essential component of the CERP.

Pursuant to the Board of Trustees’ eminent domain policy, DSL has mailed proper notice to all owners of record in Phases III and IV at least 45 days preceding this Board of Trustees’ meeting. In accordance with the eminent domain policy, the notice advised the owners that homesteaded property was exempt from eminent domain without the owner’s written permission. As of April 3, 2001 at 5:00 p.m., only 16 responses to the written notice had been received. While 16 of the owners representing 16 parcels objected to the use of eminent domain, they only represent 1 percent of the remaining ownerships in Phases III and IV. Additionally, none of the respondents claimed the property involved to be their homestead. Based on research of tax records by staff, there does not appear to be any homesteaded property within Phases III and IV. If it is later determined that there is any homesteaded property and the owner has not given written consent, that parcel will be excluded from the eminent domain process unless the Board of Trustees waives its policy on homestead property. If the Board of Trustees approves this item, DSL intends to amend its existing contract with the Office of the Attorney General to handle the condemnation of these parcels. Once second bona fide offers are tendered on additional groups of parcels, staff will return to the Board of Trustees periodically to seek authority to pursue those parcels that have reached impasse or parcels that cannot be closed by voluntary means. It is anticipated that there may be as many as ten such groups or phases.

The property will be managed by the Department of Agriculture and Consumer Services, Division of Forestry as an addition to Picayune State Forest. The South Florida Water Management District will coordinate the implementation of the hydrologic restoration project.

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Agenda – April 10, 2001

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Substitute Item 6, cont.

These acquisitions are consistent with section 187.201(10), F.S., the Natural Systems and Recreational Lands section of the State Comprehensive Plan.

(See Attachment 6, Pages 1-27)

RECOMMEND APPROVAL

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Substitute Item 7 DOC/Glenbeigh Hospital Property/Rejection of Bids

REQUEST: (1) Consideration of bids received for a 4.45-acre parcel of state-owned land consisting of a 100-bed hospital building and parking lot on 2.58 acres and a 1.87-acre vacant parcel in Dade County; (2) rejection of all bid(s) received; and (3) direction to staff to proceed with the sale of the property in accordance with the provisions of section 18-2.020, F.A.C.

COUNTY: Dade

LOCATION: Section 02, Township 35 West, Range 40 East

4425 West 20^th Avenue, Hialeah, Florida

CONSIDERATION: In the event the property is sold, any proceeds are to be deposited in the Florida Department of Correction’s Grants and Donations Trust Fund

STAFF REMARKS: Division of State Lands (DSL), as staff to the Board of Trustees, rejected all bids on the proposed sale of the Glenbeigh Hospital property on January 30, 2001:

Glenbeigh Hospital Name Amount Bid

Parcel One (hospital building and parking lot): Dijevi Investment, N.V. $1,000,050

Parcel Two (vacant parcel): Dijevi Investment, N.V. $ 300,000

Cesar Del Rey $1,301,002

Subsequent to that rejection of the bids, DSL received correspondence from an attorney representing Cesar Del Rey taking the position that the bids must be rejected by the Board of Trustees and not solely by Board of Trustees' staff. Staff traditionally exercises this function under its delegation of authority, but the language used in these bid packages is contradictory in that it states that the bids will be presented to the Board of Trustees for their consideration at the Board of Trustees’ meeting. Accordingly, and in order to facilitate the sale of this property by June 30, 2001, this item is being submitted to the Board of Trustees for the Board of Trustees to formally reject all bids. Time is of the essence for DOC to close on this property prior to the end of the fiscal year. At the end of the fiscal year, the proviso language will expire so that this transaction cannot be completed to satisfy the needs of DOC. After the bid rejection by the Board of Trustees is accomplished, DOC and DSL can continue to move forward with the sale of this property for the benefit of all concerned.

In 1994, DOC purchased the Glenbeigh Hospital, which is a 100-bed facility (56,015 gross square feet), situated on 4.45 acres, in the City of Hialeah, to be used in conjunction with treatment of offenders for substance abuse. At the time of purchase, DOC paid $3,750,000 for the property. DOC proceeded to use the property as a substance-abuse treatment facility for offenders and a probation and parole office. Prior to the sale, the facility was operated as a

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Substitute Item 7, cont.

private, substance-abuse hospital owned by Glenbeigh Hospital of Miami, Inc.

DOC was informed, by both the owners of Glenbeigh Hospital and the selling agent, that the facility could meet DOC’s zoning requirements because it was grandfathered-in as a substance- abuse hospital. After the sale, DOC was informed that Glenbeigh Hospital had operated under a special-use permit and that DOC would be required to obtain such a permit to operate a substance-abuse facility. DOC applied for a special-use permit; however, the special-use permit was denied in part to the fact that the County Zoning Office had denied a special-use permit for a similar treatment facility within the same area. Subsequently, DOC appealed this decision.

In 1998, the Legislature adopted proviso language that ordered DOC to sell, exchange or dispose of the Glenbeigh Hospital property if DOC lost the zoning appeal. The proviso language indicated that DOC was to retain the proceeds of the sale. DOC subsequently did not prevail in the appeal and the property was processed for sale by Department of Management Services (DMS) between late 1998 and early 1999. Prior to sale, the Department of Children and Family (DCF) requested that DOC execute a Release of Lease on July 8, 1999, allowing DCF to lease the property directly from the Board of Trustees. DCF subsequently leased the property. However, in late 1999, DCF requested that it be released from the lease. At that time, DSL required a replacement lessee first be secured. DOC agreed to accept a lease on the property and a new lease was entered into on February 18, 2000. DOC is currently attempting to sell the property based upon the original legislative directive.

Chapter 2000-166, Laws of Florida, provides that DOC, with approval of a majority of the Board of Trustees, may sell, trade, exchange or otherwise dispose of the Glenbeigh Hospital property, and for the proceeds to be directed to DOC’s Grants and Donations Trust Fund, and subject to specific appropriation, to use the proceeds to acquire, construct, equip, maintain, or improve DOC’s correctional facilities.

The Acquisition and Restoration Council approved the surplusing of the Glenbeigh Hospital property on October 17, 2000. Pursuant to section 253.111, F.S., state agencies, the county and the City of Hialeah were noticed that the property was available for sale. No interest in purchasing this property was received from the state, local and county governments at this time. Notice of the availability of the property was also given to the property owners within 500 feet, in accordance with section 253.115, F.S., and no objections were received.

This property was appraised for the initial purchase by DOC on June 21, 1994, by L. Glenn Johnston, MAI. The market value found by Mr. Johnston was $3,672,000. Quinlivan Appraisal, P.A., provided the required second appraisal on July 5, 1994. The market value found by Mr. Quinlivan was $3,775,000. In preparation to sell the property DMS obtained another appraisal on January 12, 1999, by Quinlivan Appraisal, P.A., and the market value found was $3,275,000. Before actually marketing the property, DSL and DOC discussed with Mr. Quinlivan current market conditions in the area. He suggested that the hospital and vacant lot might bring a higher bid price if marketed separately due to the deteriorating condition of the building. Based on that information, DSL and DOC agreed to market the property separately with the understanding that in the event the combined values of the vacant lot and the hospital did not meet or exceed the $3,750,000 originally paid by DOC, the bids could be rejected and the property marketed together. Section 253.034(6)(g), F.S., states "Lands determined to be surplus pursuant to this subsection shall be sold for fair market value or the price paid by the state or a water management district to originally acquire the lands, whichever is greater...". Since the combined bid totals are less than the price paid by DOC to originally acquire the property, staff is prepared to market and accept other offers on the property in order to sell this property prior to the expiration of the proviso language on July 1, 2001.

Board of Trustees

Agenda – April 10, 2001

Substitute Page Twelve

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Substitute Item 7, cont.

Section 18-2.020(2)(b), F.A.C., states "Disposal of surplus land shall be competitively bid except that parcels 5 acres or less in size or with a market value of $100,000 or less may be sold by any reasonable means, including open or exclusive listing with real estate sales services, competitive bid, auction, and negotiated direct sales. In no case shall a real estate brokerage fee or auction fee exceed 10% of the purchase price."

The property was advertised for sale in The Wall Street Journal, The Miami Herald, and The Miami Business Daily Review from November 22, 2000 to January 27, 2001. Two large "For Sale" signs were placed on the property, visible from the Palmetto Expressway, on November 28, 2000. The property was held "open" for inspection on four (4) dates, December 12 and 13, and January 13 and 14, 2001. Five hundred and sixty-two (562) informational brochures/notices were mailed out regarding the property at this time. Fifty-three (53) of these mailouts went to state and local governmental entities and 65 bid packages were also requested and mailed. The property was advertised and bid as two separate bid options. One of these bid options contained the hospital building and parking lot on 2.58-acres. The second bid-option contained only the 1.87-acre parking lot and was advertised as a vacant building site. The bids on the property were opened on January 30, 2001, and the bids submitted are as follows:

Parcel One (hospital building and parking lot):

Parcel Two (vacant building lot):

(See Attachment 7, Pages 1-85)

RECOMMEND (1) REJECTION OF ALL CURRENT BIDS; AND (2) STAFF BE DIRECTED TO SELL THE PROPERTY IN ACCORDANCE WITH THE PROVISIONS OF SECTION 18-2.020, F.A.C.

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Substitute Item 8 Chapter 18-21/Section 18-21.0083, F.A.C./Notice of Proposed Rulemaking

REQUEST: Consideration of approval to publish a Notice of Proposed Rulemaking regarding amendments to chapter 18-21, F.A.C., that address the procedures, fees, forms of authorization, and standards for revitalization or similar projects for government entities on sovereignty submerged lands.

COUNTY: Statewide

APPLICANT: Department of Environmental Protection (DEP)

Board of Trustees

Agenda – April 10, 2001

Substitute Page Thirteen

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Substitute Item 8, cont.

STAFF REMARKS: Staff is proposing to add section 18-21.0083, F.A.C., Authorizations for Pier Projects by Government Entities. A copy of the proposed rule is attached. The proposed rule contains provisions on the procedures, fees, forms of authorization, and standards applicable to pier projects for government entities on sovereignty submerged lands that include major non-water dependent uses, and leases up to 50 years. The current rule prohibits non-water dependent uses except for minor non-water dependent uses adjacent to seawalls or other non-natural shorelines, located outside aquatic preserves or class II Outstanding Florida Waters, incidental to the basic purpose of the project and that constitute only minor nearshore encroachments on sovereignty submerged lands. The current rule also limits the term of years in sovereignty

submerged lands leases to 25 years.

Recently, bills have been introduced into both houses of the Legislature, (Senate Bill Number 922, prefiled on February 21, 2001, by Senator Burt and House Bill Number 891, filed March 6, 2001, by Representative Wiles) to create a local act that directs the state to issue a sovereignty submerged lands lease to the City of Daytona Beach (City). The purpose of the act is to facilitate the creation of an extensive public pier for the City in furtherance of the City’s downtown redevelopment initiative. The proposal under Senate Bill 922 provides for certain non-water dependent uses on sovereignty submerged lands, sets a lease period of 50 years, and directs that $5,000 per year (unadjusted for inflation) be paid to the Board of Trustees. The proposal under House Bill 891 is similar, except that it includes language that is closer to language used in current leases entered into by the Board of Trustees (e.g., lease cannot be assigned without further authorization of the Board of Trustees, "cruises to nowhere" are prohibited, etc.). House Bill 891 further provides that lease fees be paid on an escalating scale over the proposed lease term. Both bills direct the state to issue a lease only if the City obtains a leasehold or fee simple interest in the uplands and pier structure. Both bills provide a legal description of the sovereignty submerged lands to be leased, but neither bill specifies the exact

acreage or square footage to be leased.

Currently, there is a pier structure already situated on the sovereignty submerged lands the City proposes to lease. Neither the pier nor the adjacent uplands is owned or operated by the City. The pier is not a grandfathered structure nor is it under lease from the Board of Trustees, but an application for a sovereignty submerged lands lease is pending. McMillan & Wright, Inc., the current upland riparian owner, applied for a disclaimer under the Butler Act and was denied a disclaimer by staff in February 2000. Staff advised the applicant that the Butler Act explicitly states that it shall not apply to sandy public bathing beaches. Further, the Butler Act does not apply to open ocean waters, being specifically limited to navigable streams, bays of the sea, harbors, or tide water lakes. Any attempt by the City to obtain a lease under its current proposal and using the Board of Trustees’ current rules would conflict with existing restrictions on non-water dependent uses and lease terms.

Additionally, the City of Jacksonville Beach is reportedly analyzing proposals to obtain authorization for a similar pier project. There may be other pier revitalization or similar proposals by other cities, towns, villages, counties or municipalities in the future. The Board of Trustees’ rules do not address situations where cities, towns, villages, counties or municipalities wish to lease sovereignty submerged lands for terms longer than 25 years for such pier revitalization or similar projects that may have non-water dependent uses. From staff’s point of view, it would be preferable to develop rules under which these requests may be considered by the Board or Trustees rather than have numerous special acts with differing criteria.

To deal with such proposals, staff requests the Board of Trustees' permission to initiate

Board of Trustees

Agenda – April 10, 2001

Substitute Page Fourteen

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Substitute Item 8, cont.

rulemaking in chapter 18-21, F.A.C., on the limited subject of authorizations for governmental use of sovereignty submerged lands under piers for revitalization or similar purposes, even when part of the use is non-water dependent. Under the proposed rule, applicants for these projects would be cities, towns, villages, counties or municipalities. The activities requested must be not contrary to the public interest and provide access to the public on a first-come, first-served basis. It is not contemplated that such projects will be allowed in rivers, streams, lakes, state parks, national parks, national seashores, national wildlife refuges, National Estuarine Research Reserve, aquatic preserves, Outstanding Florida Waters, research management areas, wildlife management areas, buffer preserves, or manatee protection zones. Authorization for projects under the rule would be limited to piers used for public recreational facilities, and not for the mooring of vessels. The rule specifically excludes requests to authorize jetties, groins, breakwaters, and any attached dock or platform. The lease term is proposed to be a maximum of 35 years. Lease fees would be negotiated as set forth in section 18-21.011(1)(b)(6), F.A.C., and the Board of Trustees shall consider unique financial arrangements and other special circumstances of the local government. Activities shall be designed, constructed, and operated to eliminate or minimize adverse impacts to sea turtles, manatees, other endangered aquatic species, or habitat, such as coral, live rock, live bottom, shellfish beds, or sea grasses. Applicants must obtain all other permits or approvals required by law.

Upon approval by the Board of Trustees, a Notice of Proposed Rulemaking will be published in the Florida Administrative Weekly. The notice will include an opportunity for a public workshop that will be noticed in the Florida Administrative Weekly. Staff anticipates returning to the Board of Trustees for final rule adoption later this year.

(See Attachment 8, Page 1)

RECOMMEND DISCUSSION

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