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Cabinet
Affairs |
2 T H E C A B I N E T
3 S T A T E O F F L O R I D A
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Representing:
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DIVISION OF BOND FINANCE
6 DEPARTMENT OF LAW ENFORCEMENT
DEPARTMENT OF REVENUE
7 STATE BOARD OF EDUCATION
ADMINISTRATION COMMISSION
8 BOARD OF TRUSTEES, INTERNAL IMPROVEMENT TRUST FUND
DEPARTMENT OF ENVIRONMENTAL PROTECTION
9
10 The above agencies came to be heard before
THE FLORIDA CABINET, Honorable Governor Chiles
11 presiding, in the Cabinet Meeting Room, LL-03,
The Capitol, Tallahassee, Florida, on Tuesday,
12 September 9, 1997, commencing at approximately
9:50 a.m.
13
14 VOLUME I
15
16 Reported by:
17 LAURIE L. GILBERT
Registered Professional Reporter
18 Certified Court Reporter
Certified Realtime Reporter
19 Notary Public in and for
the State of Florida at Large
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23 ACCURATE STENOTYPE REPORTERS, INC.
100 SALEM COURT
24 TALLAHASSEE, FLORIDA 32301
850/878-2221
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1 APPEARANCES:
2 Representing the Florida Cabinet:
3 LAWTON CHILES
Governor
4
BOB CRAWFORD
5 Commissioner of Agriculture
6 BOB MILLIGAN
Comptroller
7
SANDRA B. MORTHAM
8 Secretary of State
9 BOB BUTTERWORTH
Attorney General
10
BILL NELSON
11 Treasurer
12 FRANK T. BROGAN
Commissioner of Education
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ACCURATE STENOTYPE REPORTERS, INC.
September 9, 1997
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1 I N D E X
2 ITEM ACTION PAGE
3 DIVISION OF BOND FINANCE:
(Presented by J. Ben Watkins, III,
4 Director)
5 1 Approved 5
2 Approved 6
6 3 Approved 6
4 Approved 6
7
DEPARTMENT OF LAW ENFORCEMENT:
8 (Presented by James T. Moore,
Executive Director)
9
1 Approved 7
10 2 Approved 9
11 DEPARTMENT OF REVENUE:
(Presented by L.H. Fuchs,
12 Executive Director)
13 1 Approved 10
2 Approved 12
14 3 Approved 12
15 STATE BOARD OF EDUCATION:
(Presented by Robert L. Bedford, Ph.D.,
16 Deputy Commissioner)
17 1 Approved 13
2 Approved 21
18 3 Approved 21
4 Approved 22
19 5 Approved 22
20 ADMINISTRATION COMMISSION:
(Presented by Gale Sittig,
21 Deputy Director)
22 1 Approved 23
2 Approved 23
23 3 Approved 24
4 Approved 24
24 5 Approved 54
25
ACCURATE STENOTYPE REPORTERS, INC.
September 9, 1997
4
1 I N D E X
(Continued)
2
ITEM ACTION PAGE
3
BOARD OF TRUSTEES OF THE
4 INTERNAL IMPROVEMENT
TRUST FUND:
5 (Presented by Kirby B. Green, III,
Deputy Secretary)
6
1 Approved 98
7
8 CERTIFICATE OF REPORTER 99
9 *
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ACCURATE STENOTYPE REPORTERS, INC.
DIVISION OF BOND FINANCE
September 9, 1997
5
1 P R O C E E D I N G S
2 (The agenda items commenced at 10:09 a.m.)
3 GOVERNOR CHILES: And I want to say to the
4 audience, we will go through the rest of our
5 agenda, because of people arriving later that
6 wanted to be here for the orimulsion hearing,
7 the Siting Board will begin its meeting at
8 1:00 p.m.
9 Division of Bond Finance.
10 Yes, sir.
11 MR. WATKINS: Item number 1 is approval of
12 the minutes of the August 28th meeting.
13 COMMISSIONER BROGAN: So move.
14 GOVERNOR CHILES: Motion --
15 COMPTROLLER MILLIGAN: Second.
16 GOVERNOR CHILES: -- and second.
17 Without objection, the minutes are
18 approved.
19 MR. WATKINS: Item number 2 is a resolution
20 authorizing the purchase and substitution of a
21 surety bond for a cash reserve held in
22 connection with the Broward County Expressway
23 Authority Bond.
24 ATTORNEY GENERAL BUTTERWORTH: Motion.
25 COMMISSIONER BROGAN: Move approval.
ACCURATE STENOTYPE REPORTERS, INC.
DIVISION OF BOND FINANCE
September 9, 1997
6
1 GOVERNOR CHILES: Moved and --
2 COMMISSIONER BROGAN: Second.
3 GOVERNOR CHILES: -- seconded.
4 Without objection, it's approved.
5 MR. WATKINS: Item number 3 is a resolution
6 authorizing the redemption of State of Florida
7 Hernando County Road Bonds.
8 COMMISSIONER BROGAN: Move approval.
9 COMPTROLLER MILLIGAN: Second.
10 GOVERNOR CHILES: Moved and seconded.
11 Without objection, it's approved.
12 MR. WATKINS: Item number 4 is a report of
13 award on the competitive sale of
14 250 million dollars in PECO bonds.
15 COMMISSIONER BROGAN: Move approval.
16 SECRETARY MORTHAM: Second.
17 GOVERNOR CHILES: Moved and seconded.
18 Without objection, that's approved.
19 Thank you, sir.
20 (The Division of Bond Finance Agenda was
21 concluded.)
22 *
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ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF LAW ENFORCEMENT
September 9, 1997
7
1 GOVERNOR CHILES: Florida Department of
2 Law Enforcement.
3 MR. MOORE: Item number 1, Governor, is the
4 minutes of the June 26th, 1997 --
5 SECRETARY MORTHAM: Move approval.
6 MR. MOORE: -- Cabinet meeting.
7 COMMISSIONER BROGAN: Second.
8 GOVERNOR CHILES: Moved and seconded.
9 Without objection, they're approved.
10 MR. MOORE: Item 2 is our annual progress
11 report for July through June of 1997. And
12 before you move that, if you'll allow me a
13 couple of brief comments.
14 Governor, as you and the Cabinet know,
15 because you were strong supporters in this
16 initiative, this represents our first year under
17 Performance Based Budgeting. And we took that
18 initiative on as a way of doing business instead
19 of just a budgeting system.
20 And I'm happy to tell you that because of
21 the efforts of the men and women in our agency,
22 we achieved or exceeded 20 of the 29 specific
23 big picture outcomes that are -- that's in the
24 appropriation bill in the Laws of the State of
25 Florida that we had to produce. That speaks
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF LAW ENFORCEMENT
September 9, 1997
8
1 very highly of the men and women in the agency.
2 A couple I'll bring to your attention. One
3 that you were very concerned about, and we were,
4 too. We conducted over 69,000 exhibits in
5 criminal cases received from local
6 law enforcement in our crime lab system here in
7 this state. My contract with you was that we
8 would do -- we would turn those cases around in
9 under 50 days.
10 We turned those cases around, on the
11 average, for all those exhibits, in under
12 39 days. That goes directly to help support
13 public safety in our state.
14 Additionally, in your package there, you've
15 been provided a summary of our first year under
16 this effort, and the outcomes that were
17 expected, and the ones that our men and women
18 achieved are highlighted here on this document.
19 I'm very proud of that. I thank you for
20 your support over time, and I'll be the first to
21 say that we have a lot to learn about this
22 performance based budgeting concept. But that
23 that we've learned so far, we like, because it
24 lets us get about the business of running our
25 business and making a difference.
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF LAW ENFORCEMENT
September 9, 1997
9
1 I thank you for your help.
2 SECRETARY MORTHAM: Move approval.
3 COMMISSIONER BROGAN: Second.
4 GOVERNOR CHILES: Moved and seconded.
5 Without objection, it's approved.
6 MR. MOORE: Thank you, Governor.
7 GOVERNOR CHILES: Thank you, sir.
8 (The Department of Law Enforcement Agenda
9 was concluded.)
10 *
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ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF REVENUE
September 9, 1997
10
1 GOVERNOR CHILES: Department of Revenue.
2 MR. FUCHS: Good morning.
3 Item 1 is a request for approval of the
4 minutes of the August 28th, 1997, meeting.
5 SECRETARY MORTHAM: Move approval.
6 COMMISSIONER BROGAN: Second.
7 GOVERNOR CHILES: Moved and seconded.
8 Without objection, they're approved.
9 MR. FUCHS: Item 2 is a request for
10 permission to submit the Department of Revenue's
11 1998-99, Legislative Budget Request to the
12 Executive Office of the Governor, and to the
13 Legislature.
14 ATTORNEY GENERAL BUTTERWORTH: I have one
15 question, Governor.
16 GOVERNOR CHILES: Yes, sir.
17 ATTORNEY GENERAL BUTTERWORTH: Okay. On
18 your issue of building rental increases, is that
19 for the -- you're asking for a few hundred
20 thousand dollars, but I'm not concerned about
21 the amount, I'm concerned about the issue.
22 Is this for State-owned buildings? You're
23 talking about private space that you've leased,
24 and there's escalator clauses in those
25 contracts.
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF REVENUE
September 9, 1997
11
1 MR. FUCHS: I believe it is the latter,
2 General. We're trying to consolidate offices in
3 every place possible in the state as leases
4 expire. We took over 76 offices when we got the
5 child support enforcement program. We had about
6 26 existing revenue offices. That was a total
7 of somewhere around 100. We're down to about
8 72. So we've already eliminated 25 offices.
9 But this money would take care of existing
10 contract escalation.
11 ATTORNEY GENERAL BUTTERWORTH: So what
12 this -- but this issue -- this issue is not
13 unique to you, this issue would be the same with
14 all the departments of government where
15 I believe the Legislature will automatically
16 fund your increases in State rent.
17 But even if you -- but if you have an
18 escalator clause in your contract, like most
19 contracts do, and probably you're about
20 equivalent to what the State would increase, you
21 do not get that same treatment for -- for
22 non-State buildings.
23 MR. FUCHS: That is correct again,
24 General. We have -- we have absorbed the costs
25 of rental increases, utility increases, office
ACCURATE STENOTYPE REPORTERS, INC.
DEPARTMENT OF REVENUE
September 9, 1997
12
1 supply, and other normal increases for most of
2 the last -- well, the five years I've been with
3 the agency.
4 ATTORNEY GENERAL BUTTERWORTH: Thank you.
5 I move the --
6 COMPTROLLER MILLIGAN: I move Item 2.
7 ATTORNEY GENERAL BUTTERWORTH: Second.
8 GOVERNOR CHILES: Moved and seconded.
9 Without objection, it's approved.
10 MR. FUCHS: Item 3 is a request for
11 permission to submit the Department of Revenue's
12 Agency Capital Improvements Program to the
13 Executive Office of the Governor, and the
14 Legislature.
15 COMPTROLLER MILLIGAN: I move Item 3.
16 COMMISSIONER BROGAN: Second.
17 SECRETARY MORTHAM: Second.
18 GOVERNOR CHILES: Moved and seconded.
19 Without objection, Item 3 is approved.
20 MR. FUCHS: Thank you.
21 GOVERNOR CHILES: Thank you, sir.
22 (The Department of Revenue Agenda was
23 concluded.)
24 *
25
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
13
1 GOVERNOR CHILES: State Board of Education.
2 DR. BEDFORD: Governor Chiles,
3 Commissioner Brogan, members of the State Board
4 of Education, good morning.
5 Item 1. Item 1, I would like to correct
6 the title. I believe the title you have is
7 Data Flow Controller. Data Flow Controller is
8 the product. The amendment is to the
9 agreement. And so the item should read:
10 Encyclopedia Britannica Educational Corporation
11 Codevelopment Agreement, Amendment Number 9.
12 COMMISSIONER BROGAN: Move approval.
13 SECRETARY MORTHAM: Second.
14 GOVERNOR CHILES: Moved and seconded.
15 Without objection, it's approved.
16 DR. BEDFORD: Item 2, Florida Adult
17 Literacy Plan State Report, which is required by
18 Florida Statute.
19 At this time, if Bob Potsko and Ron Scull
20 would come forward, we have a brief presentation
21 on the Florida Adult Literacy State Report.
22 MR. POTSKO: Governor Chiles,
23 Commissioner Brogan, State Board of Education
24 members.
25 This morning, as we kick off with your
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
14
1 resolution this major campaign to increase
2 public awareness of the literacy in Florida, I'd
3 like to present, very quickly, some facts to
4 establish the magnitude of this hot issue.
5 More than -- if you can believe this --
6 one million seven -- point seven million Florida
7 adults have reading skills below the
8 eighth grade level. These are adults sixteen
9 years of age and older have left school. That's
10 a crying shame. Twenty percent of all adults in
11 Florida read at or below the fifth grade level.
12 Imagine them functioning in jobs with the
13 high technology that we like to think Florida is
14 involved in today.
15 Seventy percent of those reading at or
16 below the fifth grade level have no jobs, or
17 only work part-time because of limited literacy
18 levels. And then 30 percent of the adults with
19 limited literacy are on welfare rolls, with no
20 chance for anything else.
21 Seventy-five percent of the unemployed work
22 force in Florida lack the necessary literacy
23 skills to get -- to do the job, to get -- or
24 upgrade, and to get a new job.
25 Over 60 percent of incarcerated adults do
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
15
1 not have a high school diploma. And we've got
2 over 80 percent of Florida's projected
3 population growth in the next ten years will be
4 from migration and immigration.
5 As you well know, many of Florida's
6 immigrants are middle-aged adults who speak
7 foreign language, who may have never had a
8 single day in a public education system.
9 Already about a quarter of Florida's
10 population is basically illiterate. And that's
11 grade one through four -- zero through four,
12 excuse me.
13 Florida's Adult Literacy Act was
14 established by the Legislature to answer the
15 recommendations of the Florida Commission on
16 Education Reform and Accountability.
17 Legislative intent of that act was to
18 establish a plan which would improve State
19 cooperation and collaboration, create an
20 integrated delivery system for literacy
21 services, and provide for the development and
22 implementation of local literacy plans.
23 Local planned components were to include
24 volunteer instruction; training of volunteers;
25 local working agreements between agencies;
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
16
1 coordination of local efforts; individual
2 instruction, evaluation, recruitment of adults
3 into the programs -- and that's the hardest
4 thing, many of these people do not realize that
5 they have this problem -- and intergenerational
6 workplace literacy.
7 These accomplishments that we're listing
8 here, without additional State resources, are
9 exceptional. Volunteer hours were calculated at
10 approximately 4 million dollars, free.
11 A total of 775 local agencies,
12 144 libraries coordinated adult literacy
13 services.
14 And would you believe, over 46,000 adults
15 were referred for adult literacy services during
16 1996. And this probably isn't complete
17 information in that we don't have an information
18 system yet that reaches across lines.
19 The PEG Program is required that all
20 probationers without a high school diploma now
21 have to enroll in adult education programs.
22 Literacy is such a huge problem to our
23 economic development and human resource
24 development, that business and philanthropists
25 are joining the battle this year. You're
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
17
1 probably going to read more about illiteracy
2 this year than ever before, because
3 Knight-Ridder, being one of the groups that are
4 putting a lot of effort in this year-long
5 campaign to stamp out illiteracy.
6 The Bill Gates Foundation is put-- he and
7 his wife are putting in millions into a program
8 that will assist libraries in attacking this
9 problem.
10 Disney is involved, and many other
11 companies that we won't name today.
12 Considerations and challenges in reaching
13 these goals. The goals that we've established
14 for this year were based really on data from the
15 1980 census. And since 1980, Florida's
16 population has increased over 1.5 million. Most
17 of the growth has come from immigration and
18 migration, again, these being very difficult
19 people to get to.
20 The difficulty in obtaining accurate and
21 consistent data regarding performance across
22 agencies and CEOs has made it nearly impossible
23 to have accurate data as to what we are doing
24 and what we have accomplished, and the job still
25 to be done.
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
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1 And that's required of the change in
2 direction. The new direction for our Adult
3 Literacy Program in Florida are planned -- it's
4 about performance, about collaboration, all
5 agencies, all CEOs, making some contributions.
6 And it's about a return on investment.
7 If we are to make headway in solving this
8 problem, it'll be through many different
9 efforts. No singular effort is going to solve
10 this problem.
11 The new plan addresses immigration,
12 migration, welfare reform, and increasing prison
13 populations.
14 The new plan is going to be based on
15 performance. We'll establish quality indicators
16 and performance standards. In other words,
17 we're only going to pay on performance.
18 We'll improve the data collection and
19 reporting, and focus on initial assessment and
20 placement of students in the program so that
21 they don't become bored, or they don't feel that
22 their efforts are too monumental in their first
23 efforts in the classroom, or in the volunteer
24 program.
25 The new plan will emphasize collaboration,
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
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1 establish a clearinghouse for literacy service
2 with the Secretary of State, Department of
3 Education, Department of Labor and Employment
4 Security, and other State agencies.
5 And as we speak here today, Secretary of
6 State and Commissioner Brogan have established a
7 group that's working on membership for this
8 clearinghouse, and on the focus that they will
9 take in eliminating the problems here of
10 collaboration that we've had in the past.
11 We're going to implement a year-long
12 campaign promoting literacy throughout Florida,
13 trying to target outreach and recruitment of the
14 volunteers.
15 Now, the reward: Collaboration between
16 literacy providers, and then fund projects that
17 leverage resources. If we can help with some of
18 the local areas with grant money that they could
19 match with local district dollars, then we'll
20 reach a lot more people with the dollars we're
21 expending. So it should be --
22 And it's important to all of us is the
23 return on our investment. Literacy programs
24 contribute to economic self-sufficiency and the
25 reduction of dependents on costly social
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
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1 services; to locate services where the need is
2 greatest; one-stop centers, career centers have
3 been established in law, and this is to help
4 students or clients go to one place and be able
5 to assist -- be assisted with all the services
6 that they need in order to become literate and
7 self-sufficient.
8 We're going to locate services in the
9 criminal justice facilities, expand family
10 literacy opportunites where children and parents
11 can read together and learn as they go.
12 Community based organizations are gearing up at
13 this point to take part in this effort.
14 Thank you for your support in the campaign
15 that you've kicked off today. And we're calling
16 our campaign: Literacy Building Florida --
17 Building a Better Florida One Word at a Time.
18 We'll work diligently, all of us, in the
19 literacy effort to focus attention of all
20 Floridians on this problem, elicit their
21 support. We need them as volunteers, we need
22 them to recruit students.
23 All this to attack the barrier of
24 self-sufficiency and self-reliance for these
25 people that binds many adults in our modern, new
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
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1 Florida.
2 Thank you.
3 GOVERNOR CHILES: Thank you, sir.
4 This is a major, major problem for
5 Florida. Looks like you have a very
6 comprehensive way of trying to solve that,
7 smart, and at the same time effective.
8 We wish you God's speed, and hope that we
9 can get you the kind of help and support that
10 you need.
11 DR. BEDFORD: Thank you. Thank you.
12 Let's go --
13 COMMISSIONER BROGAN: I would move the
14 item, Governor.
15 SECRETARY MORTHAM: Second.
16 GOVERNOR CHILES: Moved and seconded.
17 Without objection, it's approved.
18 DR. BEDFORD: Item 3, reappointment to the
19 Florida Board of Regents of James R. Harding;
20 expiration date, September 1st, 1998.
21 SECRETARY MORTHAM: Move approval.
22 COMMISSIONER BROGAN: Second.
23 GOVERNOR CHILES: Moved and seconded.
24 Without objection, that's approved.
25 DR. BEDFORD: Item 4, appointment to the
ACCURATE STENOTYPE REPORTERS, INC.
STATE BOARD OF EDUCATION
September 9, 1997
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1 District Board of Trustees, Pasco-Hernando
2 Community College: Joy G. Hobby; expiration
3 date, May 31st, 1999.
4 COMMISSIONER BROGAN: Move --
5 SECRETARY MORTHAM: Move approval.
6 COMMISSIONER BROGAN: Second.
7 GOVERNOR CHILES: Moved and seconded.
8 Without objection, that's approved.
9 DR. BEDFORD: Item 5, reappointments to the
10 District Board of Trustees, Miami-Dade Community
11 College: Barbara A. Ibarra,
12 Walter T. Richardson, Cristina L. Mendoza,
13 May 31st, 2001.
14 COMMISSIONER BROGAN: Move approval.
15 SECRETARY MORTHAM: Second.
16 GOVERNOR CHILES: Moved and seconded.
17 Without objection, that's approved.
18 DR. BEDFORD: Thank you.
19 (The State Board of Education Agenda was
20 concluded.)
21 *
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ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
September 9, 1997
23
1 GOVERNOR CHILES:
2 Administration Commission.
3 MS. SITTIG: Recommend approval of the
4 minutes for the meeting held August 12th, 1997.
5 SECRETARY MORTHAM: Move approval.
6 COMMISSIONER BROGAN: Second.
7 GOVERNOR CHILES: Moved and seconded.
8 Without objection, that's approved.
9 MS. SITTIG: Recommend approval of the
10 transfer of general revenue appropriations under
11 Items A., B., C., D., and E., in the Department
12 of Children and Families.
13 COMMISSIONER BROGAN: Governor, I'll move
14 approval of Items 2 A., B., C., D., and E.
15 SECRETARY MORTHAM: Second.
16 GOVERNOR CHILES: Moved and seconded.
17 And without objection, the items are
18 approved.
19 MS. SITTIG: Recommend approval of the
20 transfer of general revenue appropriations in
21 positions in excess for the Department of
22 Juvenile Justice.
23 SECRETARY MORTHAM: Move approval.
24 COMMISSIONER BROGAN: Second.
25 GOVERNOR CHILES: That's been moved and
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
September 9, 1997
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1 seconded.
2 Without objection, Item 3 is approved.
3 MS. SITTIG: Recommend approval for the
4 transfer of general revenue appropriations for
5 the Department of Labor and Employment Security.
6 SECRETARY MORTHAM: Move approval.
7 COMMISSIONER BROGAN: Second.
8 GOVERNOR CHILES: Moved and seconded.
9 Without objection, that's approved.
10 MS. SITTIG: Okay. Item 5, request
11 authorization to enter the amended draft notice
12 and order of intent to set surety.
13 We have a few speakers on this issue who
14 will give brief presentations. The first one is
15 Walt Schmidt, State geologist with DEP, who will
16 summarize the recommendation.
17 DR. SCHMIDT: Thank you.
18 Governor, and members of the
19 Administration Commission, my name is
20 Walt Schmidt. I am the Chief of the Florida
21 Geological Survey, which is a bureau within the
22 Department of Environmental Protection.
23 With your permission, I could take
24 questions on our agenda item, or in 5 or
25 6 minutes, I could give you a briefing on the
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
September 9, 1997
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1 procedures that the Department used to come up
2 with our recommendation.
3 And if you'd like the briefing, I'll
4 proceed with that.
5 GOVERNOR CHILES: Yes, sir.
6 DR. SCHMIDT: The original calculation for
7 this offshore well, it came before the Governor
8 and Cabinet as a DNR item back in 1995, was
9 proposed at a 550 million dollar bond.
10 We had no specific guidelines to help us,
11 and to determine how to calculate that. And we
12 determined using an approximately 2 mile per
13 hour dispersal rate and a 12-hour dispersal
14 time, that was what we came up with.
15 The Cabinet at that time asked us if that
16 was the worst case scenario, and, of course, the
17 answer was it was not. So we were asked to go
18 back and recalculate it.
19 Staff went back and did that, and used a
20 one million barrel spill that was suggested as a
21 worst case scenario, a maximum credible spill by
22 the applicant, and determined that that spill in
23 impacting the three-county area that they call a
24 primary impact area, it came out with a
25 calculation of 1.9 billion dollars using the
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
September 9, 1997
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1 formula in Chapter 396 regarding estimate of
2 natural resources costs based on the acreages of
3 the various types of habitats that we were aware
4 of.
5 And, of course, that was approved by the
6 Trustees.
7 In May of 1995 -- that was later -- that
8 was approved in May of 1995.
9 It was later overturned in court, in the
10 district courts, and the grounds were that the
11 Department did not have the authority to add an
12 additional bond for surety.
13 And I think it's important to remember or
14 recall that it did not specifically object to
15 the methods or the procedures that the
16 Department used in calculating what was worst
17 case scenario as far as potential damages.
18 So that brings us to our current proposal.
19 As you're aware, in 1997, Florida Law 97-49
20 passed the Florida Legislature.
21 That required the Department to recommend
22 to the Administration Commission for all
23 applications in coastal waters, that included
24 pending applications, a reasonable surety.
25 The amount was to be based on the projected
ACCURATE STENOTYPE REPORTERS, INC.
ADMINISTRATION COMMISSION
September 9, 1997
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1 cleanup costs, and natural resources damages
2 resulting from a maximum oil spill in adverse
3 hydrographic and atmospheric conditions that
4 would tend to transport oil into environmentally
5 sensitive areas.
6 That is now a directive with specific
7 guidelines to assist the Department on how to go
8 about making a recommendation to the
9 Administration Commission. We now had some
10 directives.
11 So the first thing we had to do, without
12 having prior history of calculating these
13 damages, or having a bond type for this type of
14 an activity, was go to our peer community that
15 deals with these issues.
16 We contacted various groups such as the
17 Interstate Oil Compact Commission, who
18 represents 38 states that deal with oil and gas
19 exploration production activities; we talked to
20 the American Petroleum Institute; and,
21 of course, the Florida arm of that, the Florida
22 Petroleum Council; and the USGS that does
23 various types of oil and gas reserve analysis.
24 These did not have specific definitions
25 dealing with spills for oil exploration wells.
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1 Some of the agencies that we did talk to that
2 did have some definitions that were able to
3 assist us included, like, the U.S. Coast Guard;
4 the Environmental Protection Agency; the
5 U.S. Minerals Management Service; and,
6 of course, our own Florida DEP Bureau of
7 Emergency Response. They had some definitions
8 that were utilized regarding oil spills that we
9 were able to start using to come up with our own
10 procedure -- procedural analysis.
11 In reviewing these various definitions,
12 most of these are all described concerning
13 vessels, facilities, and pipelines. As I
14 mentioned, nothing specifically to oil
15 exploration wells.
16 And they have various terms that they use
17 for these different potential accidents, things
18 like the average most probable discharge, again,
19 dealing with facilities or vessels; something
20 called a major discharge; something called a
21 most probable discharge.
22 And then a couple terms that seemed to have
23 some application to what we've elected to do:
24 Something called a maximum most probable
25 discharge. Again, keep in mind, this is
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1 specifically to facilities and vessels.
2 But how that term is defined, it's based
3 upon the historically largest recorded spill for
4 an area.
5 So what has occurred in the past for the
6 particular area in question, or the jurisdiction
7 in question, they define a maximum most probable
8 discharge as the largest historically recorded
9 spill for an area.
10 There's also another term that they use
11 called a worst case discharge, again, for
12 facilities and vessels. The way they define
13 that is it means a loss of an entire capacity of
14 a facility in question.
15 Or it means a discharge in adverse weather
16 conditions of an entire cargo. Again, dealing
17 with a vessel.
18 That's some of the definitions we were able
19 to find. In discussing with our Federal peers,
20 the U.S. Mineral Management Service that deals
21 with this, they currently have a ceiling of
22 35 million dollars requiring financial --
23 financial responsibility for an offshore oil and
24 gas facility.
25 They have currently on the books a proposed
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1 revision of that, which they anticipate to go in
2 effect the beginning of 1998 to raise that
3 ceiling to 150 million. That's what the
4 Minerals Management Service has.
5 So we take what we learn from our
6 colleagues and our peers that deal with these
7 issues, and then we try to apply it to the
8 situation we're here before you on.
9 We initially look at what the applicant
10 supplied us in their backup as described --
11 that's how some of the others do it regarding
12 area of impact, look at the backup that is
13 submitted to you.
14 Well, the applicant described something
15 called a maximum credible spill at a million
16 barrels. They also have in their report, and
17 they state that a situation could occur that
18 could result in excess of three million barrels
19 being spilled.
20 Their report also says, and I quote from
21 it: It's safer to overestimate the severity of
22 an incident than to downplay its magnitude.
23 Now, in a recent letter to the
24 Administration Commission, I believe a
25 week-and-a-half go, Coastal submitted a
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1 prospect -- a -- what they believe they could
2 produce in oil from their prospect. And they
3 conservatively estimate that they could produce
4 546 million barrels from the prospect off of
5 St. George Island.
6 This would calculate somewhere between 9
7 and 11 billion dollars of reserve value, based
8 on today's market of price per barrel.
9 Now, their one million barrel spill
10 scenario, that they called maximum credible
11 spill, would calculate out to .2 percent of what
12 they believe they can produce from that
13 prospect.
14 Their three million barrel scenario would
15 calculate out to .6 percent of what they believe
16 they can produce from that prospect.
17 So now we get implementation of a law that
18 passed the Legislature this past session,
19 Law 97-49.
20 It requires the Department to recommend to
21 the Administration Commission a reasonable
22 surety based on a maximum oil spill.
23 Now, we don't have any -- one place we can
24 define this that has occurred, and there's a
25 history of it. So we have to try to determine
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1 what is reasonable and what is maximum.
2 Clearly, if one wanted to determine what is
3 a maximum potential oil spill, one might say,
4 well, let's -- what's the largest oil field in
5 the world that could exist, that we know exists,
6 has already been mapped and produced and defined
7 by petroleum geologists and petroleum
8 engineers. Suppose that exists off St. George
9 Island.
10 One would say, okay, that's the maximum
11 potential. But we don't think that's reasonable
12 because it's not likely that a maximum oil field
13 in the world that's also going to exist off
14 St. George Island. We have no reason to believe
15 that. That's not reasonable.
16 Suppose we looked at the largest field that
17 could exist in North America? Up in Alaska,
18 Prudhoe Bay. Again, that may be an existing
19 field, it's been mapped, we know it exists on
20 the face of the earth, we have data to prove it;
21 but we don't think it's reasonable to say that
22 could occur here.
23 We also choose not to go and find the
24 largest oil field in the Gulf of Mexico. We
25 have lots of oil production in the Gulf of
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1 Mexico. But just to take the largest field
2 that's produced there, and say that could also
3 exist off St. George Island we don't think is
4 reasonable. We chose not to do that.
5 We also chose not to use the applicant's
6 recommendation that they -- or suggestion that
7 they think it can produce 546 million barrels.
8 That's highly speculative, it hasn't produced
9 any oil, we don't think it's reasonable to use
10 that.
11 We also chose not to take the largest oil
12 field that exists and is mapped and is already
13 producing in the state of Florida, the Jay Field
14 north of Pensacola.
15 If we used that, it would be over
16 400 million barrels. It's not reasonable to
17 think that that large type of field is going to
18 be off of St. George Island. We chose not to do
19 that.
20 We chose not to go look at all the oil
21 wells in the Gulf of Mexico and find the well
22 that has the greatest volume of production, and
23 say, well, we think that one well or that large
24 volume production could also be off St. George
25 Island. We don't think that's reasonable to
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1 think that that could occur in an area that's
2 never produced oil, it's never been proven, it's
3 just not reasonable it's going to happen.
4 And we chose not to use any various spills
5 from tankers, pipelines, or vessels, because
6 that's really kind of an apple and an orange.
7 They have a much greater failure rate than
8 exploration wells. It's not reasonable to use
9 that type of a spill in this type of a
10 scenario. It's a different issue.
11 So what we did choose to use regarding a
12 spill volume is, we used a maximum spill from
13 one well that did occur in modern times in the
14 Gulf of Mexico. It occurred off of Mexico, the
15 Ixtoc spill in 1979. And it produced -- it
16 spilled about 3.57 million barrels of oil. This
17 would represent about .65 percent of what the
18 applicant believes they could produce from that
19 prospect.
20 Now, of course, this well was not planned
21 to fail. This well was not designed to have a
22 blowout. It was engineered and designed and
23 built to be a successful oil production well.
24 That was the game plan. They used the
25 technology they have available. But it was an
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1 accident. It failed. It can happen. It's
2 reality. It's not speculation.
3 We choose to use that well as the maximum
4 potential spill for those reasons.
5 Now, it's important to keep in mind, we
6 recognize, as professional engineers and
7 professional geologists, that the increased
8 capability of the petroleum industry in safety
9 and in environmentally safe designs, and in the
10 statistically valid track record that the
11 industry has regarding spill rates. Not an
12 issue. We concur with that, we recognize it,
13 we -- we applaud it.
14 But it's not relevant to what the
15 Department must do in compiling the
16 recommendations of this Commission.
17 The Legislature did not say in their -- in
18 their directive that the DEP should consider
19 statistically relevant spills, or the likelihood
20 of a spill, or the probability of a spill. We
21 are to recommend a number based on a maximum
22 spill under adverse hydrographic and atmospheric
23 conditions. Accidents occur, and they have.
24 The statistical probability, the
25 likelihood, in my view, as a noneconomist, would
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1 deal with the establishment of rates when it
2 comes to what -- what it would cost to fund a
3 bond like this, but not the maximum potential
4 area of impact.
5 So that's the spill. Now we look at the
6 area. What area potentially could be impacted
7 or covered?
8 We used the impact area that was defined by
9 the applicant similar to how the other agencies
10 do it in the contingency plans backup supplied
11 with facilities and vessels.
12 The impact areas defined by the applicant
13 stretch from Escambia County on the west to
14 Pasco County on the east.
15 Now, we calculate -- using Chapter 376.121,
16 which is an established procedure for
17 determining values of acreages and habitats and
18 natural resource costs. We applied that formula
19 to that entire area.
20 But trying to be reasonable, we assumed
21 that that area will probably not be completely
22 impacted. Because in all likelihood, a spill
23 will probably be unidirectional in its
24 migration, based on predominant atmospheric
25 conditions and oceanographic conditions.
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1 We all know that hurricanes and storms do
2 oscillate and are unpredictable. We think it's
3 much more reasonable to say it'll most likely be
4 unidirectional, and go one direction. So we
5 look at the area, the entire area, and we picked
6 the largest one, recommending a maximum
7 potential spill area, the worst case, so to
8 speak.
9 The habitat was compiled with information
10 submitted to us from the Florida Marine Research
11 Institute, of where they have acreage
12 information on all these different habitat types
13 that plug into the formula of Chapter 376.
14 Now, we don't have specific spill
15 projectory analysis to base this on. The
16 applicant has agreed to submit, as a requirement
17 of the permit, a spill trajectory analysis, and
18 that will come in before they spud. In other
19 words, before they do any work or actually start
20 the operation. It's a -- it'll be a requirement
21 of the permit, which they agreed to, I think it
22 was back in 1993. And we haven't received that
23 yet, they haven't submitted that yet.
24 But that's an irrelevant point. Okay.
25 Where a trajectory spill analysis would take the
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1 oil is irrelevant to what we must recommend to
2 this Commission, because the law directs us to
3 recommend damages based on a case where the
4 sensitive environments will be impacted from
5 adverse hydrographic and atmospheric
6 conditions.
7 It doesn't tell us to run a trajectory
8 analysis, and limit our recommendations to that
9 one case, or two cases. We have a maximum case
10 to recommend to you.
11 I remember about eight or ten years ago in
12 trying to determine what is reasonable in an
13 area that could be covered when the State of
14 Florida was in negotiation with the Federal
15 government off of southwest Florida, looking at
16 some trajectory analysis that were presented
17 before the Governor and Cabinet.
18 And I recall those trajectory analysis
19 going from the southwest Florida area off
20 Sanibel, going into the 10,000 islands, going
21 into Florida Bay, going around Key West, and
22 going up the east coast all the way to
23 West Palm Beach and beyond.
24 And what I'm familiar with, the gyres of
25 the Gulf coast and the northern part -- the
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1 northeast part of the Big Bend in Florida, this
2 recommendation is clearly reasonable based on
3 the potential impact area.
4 It also parallels the language as described
5 in the applicant and their backup about should
6 oil reach the panhandle beaches, and should oil
7 reach the Big Bend grass beds, clearly, an area
8 of potential impact from an oil spill in that
9 area.
10 So we used this approach again paralleling
11 the approach we used last time that come up with
12 a 1.9 billion dollar bond. But now we have the
13 specific legislative directive. We used the
14 same approach, because it was approved in the
15 past, it's professionally adequate, and it
16 follows legislative direction, it's proven.
17 And just to finish up real quickly, we used
18 cleanup costs that were associated with the
19 Tampa Bay spill, which is primarily in a sandy
20 beach area.
21 We used -- clearly oil spills are
22 different, and they vary on the basis of type of
23 oil, the volume of the spill, the weather, the
24 nature of the coastline, or whatever.
25 The rate of the spill is well documented,
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1 and there's a lot of economic information to
2 support it. We had a particular rate of about
3 2.5 million per mile. We simply multiplied that
4 rate by the number of miles in the area of
5 impact.
6 We didn't use a multiplier for all the
7 sinuosity of the coastline. We used a straight
8 line as the crow flies. We tried to be
9 reasonable.
10 We didn't use a multiplier, because of
11 areas where they're not sandy, but there are
12 wetlands in the Big Bend and the mangrove areas,
13 even though the applicant says they may take
14 more years to clean up than a sandy beach. We
15 wanted to be reasonable, and make sure it was a
16 reasonable, conservative estimate.
17 We've come up with two numbers, one for the
18 west, which would be in the 2 million dollar
19 range; and the one that we recommend to this
20 Commission is the one for the east, because the
21 natural resources are greater, and that comes
22 out to four billion two hundred and forty-nine
23 million six hundred and thirty-seven, eight
24 hundred and eighty-six dollars.
25 And that is our recommendation.
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1 Do you have any questions?
2 GOVERNOR CHILES: Other questions.
3 Thank you, sir.
4 MS. SITTIG: Okay. The next presenter is
5 Bob Angerer. He's an attorney representing the
6 Coastal Petroleum Company. He'll have a brief
7 power point presentation for you.
8 MR. ANGERER: Governor, members of the
9 Administration Commission --
10 (Commissioner Crawford exited the room.)
11 MR. ANGERER: -- thank you for the time
12 today. I'm Bob Angerer, as she said, on behalf
13 of Angerer & Angerer for Coastal Petroleum
14 Company, the applicant of Permit 1281 that was
15 granted.
16 We -- I also have with me Dr. Tom Herbert,
17 a professional geologist, who can address the
18 importance of this area off St. George Island to
19 Coastal Petroleum Company, and the specific
20 prospect that's located there. It's -- it is
21 larger than the Jay prospect.
22 I just returned from a trip for a week to
23 work with the geologists. They were deposed by
24 the State, and I think those findings can be
25 shared with you as well. They're very detailed
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1 and they demonstrate a good prospect.
2 We're here today on the amount of the
3 surety, and we'd like to respond to -- to that.
4 Chapter 97-49 has one key point, from our
5 perspective, and that is that it requires that
6 the bond, the surety, shall be a reasonable one.
7 And I listened to Dr. Walt Schmidt here a
8 moment ago as he went through the travail of
9 trying to figure out how to calculate it. You
10 heard that.
11 There are no rules that have been adopted
12 by the Administration Commission since this was
13 adopted, nor by the Department of Environmental
14 Protection, to do that. And it's our position
15 that that must be done before any application
16 such as this of a surety to an existing permit
17 can be done.
18 What is reasonable? Reasonable is -- is
19 defined as not disregarding the facts.
20 And if -- if I may, first of all, I have to
21 respond to a couple of the comments. Coastal
22 never suggested, never suggested that the spill
23 would be one million or three million barrels.
24 We did not -- we did object to the calculation
25 to begin with.
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1 In some ways, I feel like the -- the
2 character in the Groundhog Day. I've been here
3 now three times. And the first two times, the
4 Cabinet approved the bond, and that bond each
5 time was reversed, it was illegal. And I'm here
6 again, and I suggest to you that this surety is
7 not reasonable.
8 We did not say one million or three
9 million.
10 Furthermore, it's unreasonable --
11 (Commissioner Crawford entered the room.)
12 MR. ANGERER: -- to say that if you poke
13 the reservoir that we looked at a moment ago,
14 that all the oil would come out of it. These
15 are not balloons, these are wells that are
16 drilled into rock, and the fluids that come from
17 the prospects flow out of rock at various rates.
18 To consider how large a reasonable bond is,
19 or a surety, however you want to look at it, you
20 have to look at the site specific
21 circumstances. And the first of those is the
22 capacity of the geologic formation to produce.
23 Some produce like fire hydrants. I've seen
24 those. Some produce like trickling water
25 hoses.
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1 And you have to look at the capacity of
2 that hole, that single hole, that cannot drain
3 the whole feature, to drain the area around it.
4 You also have to look at the geologic
5 location to see what the winds and the currents
6 and tide might do. You have to look at the
7 time -- the duration of the spill.
8 If you have equipment there, and -- and you
9 take the time, as we do in United States waters,
10 to control it as quickly as possible, it's not
11 going to be 295 days or a year, it's going to be
12 a much less period of time.
13 And then you have to look at the expected
14 trajectory. There is a proper way to calculate
15 a surety. It's done all the time. In fact, the
16 Department has staff that could have done it.
17 The rule could have been established
18 establishing what is the norm in the
19 United States, and the -- and to be expected.
20 So you have to look at these site specific
21 facts.
22 Now, this analysis that was described to
23 you by Dr. Schmidt was based on erroneous
24 assumptions. And the first of those erroneous
25 assumptions was referred to by him as the
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1 secondary impact area.
2 That term came up in Coastal's filings for
3 sure, it was written by Dr. David Gettleston.
4 And Dr. Gettleston, when he found out that the
5 Department was relying upon his use of the term
6 secondary impact area -- which, incidentally,
7 included everything from the Alabama border down
8 to Tampa -- was aghast, filed a letter that's in
9 your record, and says that he never intended
10 that to mean that oil would enter those areas.
11 Those are areas people would shy away from, and
12 not visit, because they might be worried about a
13 spill in what was called the primary impact
14 area.
15 We pointed that out to the Department, and
16 they said, oh, no, David -- Dr. Gettleston's
17 report has -- and he's -- they've quoted this in
18 a letter, has two inconsistencies with that. I
19 submit to you, those inconsistencies are not
20 inconsistent. There are areas west of
21 Cape San Blas that are within the primary impact
22 area, and sea grass beds that are to the east of
23 Apalachicola.
24 After all, who better than the author of
25 that report knows what he meant by secondary
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1 impact.
2 Now, the inclusion of the secondary impact
3 areas means that it's a presumption there's oil
4 in those areas, which Dr. Gettleston says is not
5 the case. So if there are no oils in those
6 areas, there are no cleanup costs; and there are
7 no natural resource damages; and, therefore, the
8 assumption greatly exaggerates -- erroneously
9 exaggerates the amount of the spill.
10 The second assumption was that Ixtoc I --
11 incidentally, the largest offshore oil spill in
12 the history of the world -- was -- is a -- is an
13 example to be used in considering what is a
14 reasonable bond.
15 First of all, spill equals volume; that is,
16 the rate of the flow from that hole, the well,
17 times the time.
18 Now, the volume that comes out of there, as
19 I said, some are like fire hydrants, and some
20 are like hoses. It just so happens that that is
21 the -- one of most productive areas; that is,
22 that that area off Mexico where this occurred,
23 off the Yucatan Peninsula, has the capacity to
24 produce 36,500 barrels per day.
25 Now, that's an astounding amount of money,
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1 and it's an astounding amount of oil, and it's
2 an astounding amount -- rate of fluid to come
3 from one formation, but it's very vuggy and
4 porous, and it comes out very well.
5 However, if you look to Jay oil field,
6 which is a smackover formation that we are
7 proposing to drill into, and we have had
8 122 wells in Jay to show what the
9 characteristics of that formation are, we find
10 that the average for those 122, is 654 barrels a
11 day, and maximizes -- the best one, was able to
12 allow 6,000 barrels a day.
13 (Attorney General Butterworth exited the
14 room.)
15 MR. ANGERER: So, you see, to rely upon
16 the -- the rate from Ixtoc is inconsistent with
17 the facts. It's a different area, and it
18 produces differently.
19 Now, in addition, spill equals volume times
20 the time.
21 Now, Ixtoc was allowed to flow for 295 days
22 unaffected. They ignored it, it was a blunder.
23 Dr. Phil Sornsen, who many of you may know as a
24 witness, and he has said under oath in another
25 proceeding that that absolutely could not happen
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1 in United States waters, and it hasn't happened
2 yet and it hasn't happened in the last 24,300
3 wells. There have only been less than 1,000
4 barrels spilled.
5 Now, if you take Ixtoc at 295 days, spill
6 times the volume, you get a large spill.
7 Whereas if you take the Jay amount, and you take
8 here using the -- the HOSS system, oil fence
9 around it as was done in Jay, five days is the
10 expected spill. And even if all of those fail
11 to shut the well down, 21 days.
12 That's not an exact comparison, but it
13 gives you an idea of what happens when you use
14 the wrong formation and the wrong duration.
15 It's greatly exaggerated.
16 Now, it is -- it's unreasonable because it
17 was -- was a blunder.
18 (Attorney General Butterworth entered the
19 room.)
20 MR. ANGERER: It -- as I've indicated a
21 moment ago, there are 30,000 wells that have
22 been drilled in the Gulf of Mexico, the last
23 24,300 have resulted in 1,000 barrels.
24 Ixtoc was a drilling blunder. It wasn't an
25 honest error, it would have caused criminal
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1 liability in this country.
2 So to summarize, the surety arguments are
3 factually flawed because of the differences in
4 the geologic formation, duration, well control
5 methods, and spill control.
6 There are some points I want to briefly for
7 the record state that Coastal doesn't even think
8 that we can set a surety here. Not only are
9 there no rules, but we don't think it can be
10 applied to this permit.
11 The law, with special legislation, pointed
12 at prohibiting us from doing this. And,
13 frankly, it appears -- this Groundhog Day thing
14 here appears a little arbitrary, 515,
15 1.92 billion, 4.3 billion. The appellate
16 decisions here preclude such a -- precludes such
17 a surety.
18 Now, how large a surety is reasonable?
19 Let's ignore the fact that we don't believe, and
20 we submit to you, that it's not proper to enter
21 such a surety. Just how large is reasonable?
22 Well, the Getty well, which was the last
23 well drilled and a bond was set by -- by the
24 State at 35 million dollars. It used -- and
25 this was after Ixtoc -- it used the oil fence
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1 like we're going to use, but it didn't have
2 available to it the fast and rapid cleanup
3 system.
4 In Federal waters, we still see a
5 35 million dollar surety requirement. So we
6 submit to you that 35 million dollars is --
7 (Secretary Mortham exited the room.)
8 MR. ANGERER: -- a reasonable surety.
9 Now, it's not enough just to tell you we
10 think that's a reasonable surety. We have run
11 what should have been done here, oil spill
12 trajectory analyses. And we've hired the
13 preeminent firm in the world for this. It's
14 called ASA. And Dr. Debbie French, who
15 developed for NOAA and others, the technology
16 that's in United States law, applied that here.
17 And the number 35 million is consistent
18 with, it's in the ballpark of, what is a
19 reasonable amount.
20 Now, this -- the value of this
21 opportunity -- and it is an opportunity -- this
22 is an asset that is on State lands, it is very
23 large. The models predict 546 million barrels
24 that -- it could be much larger, and there are
25 other prospects as well.
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1 That is 9 billion dollars in revenues over
2 20 years, and almost 2 billion to the State.
3 It's 100 million dollars a year for about
4 20 years that could come into the State to fund
5 protection of other State lands. Ninety
6 million dollars to severance taxes go to
7 Franklin County, a hundred million dollars a
8 year come to the State.
9 We respectfully submit that the facts -- we
10 dispute the facts that have been represented to
11 you. We did not make the statements that are
12 made there. We submit that the -- without the
13 rules establishing a proper methodology, it
14 should not be applied. And even if you look at
15 what might be applied, 35 million dollars is a
16 reasonable amount.
17 Now, we have filed a letter this day, and I
18 hope you all have that. And we have also given
19 you a copy of these slides.
20 We thank you for your time, and
21 respectfully request that you do not enter a
22 surety with respect to this permit application.
23 Be glad to answer any questions, or
24 Dr. Herbert can answer any about the permit.
25 (Secretary Mortham entered the room.)
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1 GOVERNOR CHILES: Are there any questions?
2 Thank you, sir.
3 MR. ANGERER: Thank you, sir.
4 GOVERNOR CHILES: Uh-hum.
5 MS. SITTIG: Okay. The last speaker who'd
6 like to make a few comments is Mark McIntosh
7 with Earth Justice Legal Defense Fund.
8 MR. McINTOSH: Governor, Cabinet members,
9 my name is Mark McIntosh. I'm from Earth
10 Justice Legal Defense Fund, formerly Sierra Club
11 Legal Defense Fund.
12 At the present time, we are in -- we
13 represent Florida Wildlife Federation, Florida
14 Audubon Society in present litigation in the
15 Division of Administrative Hearings addressing
16 the legitimacy of Coastal Petroleum's permit
17 application for drilling -- for exploratory
18 drilling 9 miles off the coast of
19 St. George Island.
20 Just two points I want to make addressing
21 Mr. Angerer. We believe that DEP does have the
22 authority to set a surety bond as it relates to
23 this permit application. This permit
24 application is pending.
25 Under the statute -- a pending application
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1 can come in two forms: One, if a 14-day under
2 the statute after a Notice of Intent to Permit
3 is published by the Department of Environmental
4 Protection, the -- there's a 14-day window in
5 which people can request a hearing on the permit
6 application. That was done on this permit
7 application by our clients within the 14-day
8 notice period.
9 The whole point of the -- of supplying a
10 hearing is to help the DEP come to a final
11 agency determination or action. That is the
12 whole point of the hearing. Therefore, this
13 permit application is pending.
14 And under the new legislation passed in
15 1997, the -- the bill clearly states that it
16 includes applications pending at the effective
17 date of this act.
18 Therefore, we believe that this pending
19 application is applicable to the new surety bond
20 requirement, and DEP can set such a surety.
21 Thank you very much for your time.
22 I respectfully request that the Board at
23 this time set the appropriate surety bond.
24 Thank you.
25 GOVERNOR CHILES: Thank you, sir.
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1 MS. SITTIG: Okay. Would you like me to
2 restate the motion -- I mean, the staff
3 recommendation?
4 GOVERNOR CHILES: Please.
5 MS. SITTIG: Okay. Request authorization
6 to enter the amended draft notice and order of
7 intent to set surety.
8 ATTORNEY GENERAL BUTTERWORTH: Move it.
9 GOVERNOR CHILES: It's been moved.
10 COMPTROLLER MILLIGAN: Second.
11 GOVERNOR CHILES: Seconded.
12 So many as favor it, signify by saying aye.
13 THE CABINET: Aye.
14 GOVERNOR CHILES: Opposed, no.
15 It's carried. Motion is adopted.
16 MS. SITTIG: Thank you.
17 (The Administration Commission Agenda was
18 concluded.)
19 *
20
21
22
23
24
25
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1 GOVERNOR CHILES: Board of Trustees of the
2 Internal Improvement Fund.
3 MR. GREEN: Item number 1, approval of use
4 of approximately 340 acres of sovereign
5 submerged land for shellfish aquaculture
6 activities, issuance of 37 5-acre aquaculture
7 leases to qualified applicants, issuance of
8 seven additional 5-acre aquaculture leases to
9 applicants after they've completed the
10 requirements, and making the remaining acreage
11 in the proposed lease areas available for lease
12 under specific conditions.
13 And we have three speakers.
14 COMMISSIONER BROGAN: Trot them up.
15 MR. GREEN: Okay. First speaker is
16 Steve Peffer, who is the Environmental Services
17 Administrator for Brevard County.
18 MR. PEFFER: Good morning.
19 My name is Steve Peffer. I am Assistant
20 County Administrator in Brevard County and the
21 Environmental Administrator.
22 I'm here to represent the Board of County
23 Commissioners today. They have submitted to the
24 Department of Environmental Protection a
25 resolution of objection to the 44 leases you're
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1 being asked to consider this morning.
2 Before discussing the basis of that
3 objection, I do want to mention a couple of
4 things. We have worked for probably the last
5 year-and-a-half with the Department of
6 Environmental Protection on aquaculture leasing
7 issues. I believe we have come a very long
8 way. We have reached agreement on virtually all
9 of the points that we felt were important.
10 If you were to look at -- kind of group
11 them in two separate areas of natural resource
12 issues and economic issues, I would tell you, I
13 believe we have reached complete agreement on
14 the natural resource based issues related to
15 these leases, and have only a few minor points
16 of disagreement with regard to the economic
17 issues.
18 I would like to also express the
19 appreciation of the County to the Department,
20 particularly David Heil and Mark Berrigan. They
21 have worked with us very hard, came to meetings
22 in Brevard, heard the issues that were presented
23 in many public meetings and the debate of our
24 commissioners.
25 We want to specifically address the areas
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1 that we were able to agree on were the use of
2 high density lease areas in Brevard County.
3 High density lease areas are a wonderful
4 concept. They're something similar to siting an
5 industrial park where you take similiar uses,
6 and put them in an area that's appropriate. We
7 feel that they are a very good use in
8 Brevard County.
9 And also the selection of those areas would
10 take into account such factors as whether
11 sea grasses were present; whether clams were
12 already present; clams that could be used by
13 native harvesters. If that clam density was
14 high, we would leave those areas unleased so
15 that that resource could be available to the
16 public or to what we refer to as open water
17 clammers.
18 We also agree that there should be a limit
19 to the total acreage in the county that should
20 be leased. One of the things that really
21 triggered the last year-and-a-half of discussion
22 was the significant number of leases you're
23 being asked to consider this morning, 44 leases,
24 5 acres, a total of over 300 acres of the
25 submerged bottom is very significant.
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1 So limiting those acres to -- limiting
2 those leases to 5 acres each is another thing
3 that we felt was worthwhile.
4 And another point was that we felt that
5 there should not be any subleasing of the leases
6 that you grant. And if I could take a moment to
7 explain.
8 During the public debate, we heard that
9 some people who had aquaculture leases were
10 actually subleasing those to others, and they
11 would raise revenues from those individuals that
12 would be in excess of $1,000 a year. Your lease
13 rates are in the order of $15 a year.
14 And our Board felt that that was really
15 taking advantage of a public resource that was
16 just simply unfair.
17 Those were areas which we could agree on,
18 and there were quite a few others. I did want
19 to really though mention the two significant
20 areas which we could not agree. And I would say
21 that these areas of disagreement were not so
22 much with ourselves and the Department, but
23 they're really issues of State policy, and we
24 understand that situation.
25 Specifically, number one, were the lease
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1 fees. These leases that you're being asked to
2 approve have a lease fee attached to them of
3 $15.58 per acre per year.
4 And I would just tell you that in the
5 opinion of our Board, that is a highly
6 undervalued natural resource, or resource of the
7 state.
8 Without trying to tell you what an
9 appropriate value was, our Board felt that a
10 more appropriate way of doing leasing would be
11 to let the market decide, to use some kind of a
12 competitive mechanism, whether it be through
13 bidding or auction or some other -- other type
14 of mechanism to allow the market to decide just
15 what that resource was worth.
16 One other item we were not able to agree on
17 was the lease term. Traditionally the leases
18 have been offered for a period of ten years, and
19 then a 10-year renewal, which is almost always
20 granted.
21 Our Board felt specifically that tying up a
22 State resource, a public resource, for 20 full
23 years was really too exclusionary, and preferred
24 to go to a 10-year lease with no real option for
25 renewal. Certainly leaseholders would be
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1 allowed to come back in through any kind of
2 process existing, competitive or otherwise, and
3 resubmit for that lease.
4 But 10 -- 20 years just seemed to be too
5 long to exclude other members of the public from
6 those specific lease areas.
7 Having said all that, I would -- just
8 wanted to point out that this would -- the Board
9 of County Commissioners does recognize that
10 there are local issues, as well as State issues,
11 with regard to aquaculture leasing.
12 You are probably all aware that this year,
13 there was a change in the Florida legislation
14 which no longer gives counties a veto of
15 aquaculture leases, and simply puts us in a
16 position of being able to make our feelings
17 known to you all through a resolution.
18 That is what our Board has done. And want
19 to just -- we are basically here to request that
20 you would appreciate the local home rule aspects
21 of the previous legislation, and acknowledge our
22 Board's request that these leases not be
23 approved at this time.
24 Having said all that, I'd be happy to
25 answer any questions --
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1 COMMISSIONER BROGAN: Governor --
2 MR. PEFFER: -- that you might have.
3 GOVERNOR CHILES: Yes, sir.
4 COMMISSIONER BROGAN: -- just a -- I guess
5 more of a comment than anything. While I
6 appreciate the County Commission's position on
7 several of the technical issues, and I do, and
8 I think we need to discuss issues of lease
9 length, and issues of permit fees, et cetera.
10 One of the reasons I know that that law was
11 changed specifically was to make certain that we
12 were not being exclusionary in opportunities to
13 be provided to aquaculture applicants, that
14 there was a concern that simply the issue would
15 rule the day, and by virtue of that fact,
16 liberal veto would be applied more than a case
17 by case basis.
18 And I guess I'm one of those people who
19 continues to scratch my head over just how we
20 ultimately are going to meet the need of the
21 people of the nation regarding seafood, as we
22 continue to see our fish stocks depleted, as we
23 continue to see opportunities for appropriate
24 clamming and lobstering and other shellfish
25 being overharvested in some areas, and those
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1 stocks being taken from us.
2 While I am not a soothsayer, I've got to be
3 commonsensical about this, and recognize, if we
4 don't start to provide other opportunities for
5 the commercial farming and harvest of seafood
6 products, whether it's fish farms or whether
7 it's aquaculture for other products, I'm not
8 quite sure what we're going to do.
9 And I know that that flies in the face of
10 some who believe not in my backyard you don't,
11 that it is fine. And that seems to be the case
12 for the seafood industry anymore is everyone
13 says, well, certainly we demand and want our
14 seafood, but we don't want anyone harvesting in
15 our area, we don't want people having
16 aquaculture leases in our area, because we don't
17 like the look of it, we don't like the way it
18 takes public leases to coincide with the
19 activity.
20 I'm -- I just happen to be a very basic
21 person on this issue who believes
that we ought
22 to be embracing -- not just from the State
23 level, but from the Federal level -- in
24 supporting the whole concept of aquaculture and
25 fish farming, to make certain that not only can
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1 we continue to supply the needs of a hungry
2 America, but also that we can see a very new and
3 rather entrepreneurial age arise where we can
4 stop depleting the resources in the old tried
5 and failed methodology, and start to do this in
6 a much more cohesive and planned formula to see
7 after the needs of the State.
8 So I for one am perfectly willing to look
9 and discuss with staff all those issues relative
10 to the technical ends of these leases, and
11 I think we should.
12 I don't know if 20 years is necessary. And
13 I know we've -- we've discussed some of those
14 20-year leases as a Cabinet before, regarding
15 some of these issues.
16 But as far as the concept is concerned, I
17 know why that law was passed. And I am one
18 person who is quite concerned with some of the
19 negative reaction of the not in my backyard
20 aquaculture approaches that we're seeing out
21 there. Maybe someday we won't need a law like
22 that, once people are better educated to
23 aquaculture, once people see a more responsible
24 approach to all of these issues.
25 But for right now, I am truly concerned
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1 that there seems to be almost a negative view of
2 aquaculture and aquaculture leases. And I think
3 that's absolutely the wrong direction that we
4 ought to be moving on this issue.
5 MR. PEFFER: May I respond?
6 COMMISSIONER BROGAN: And by the way, that
7 is certainly not to suggest that that is the
8 Brevard County Commission. It is rather global
9 in its scope.
10 MR. PEFFER: Well, thank you, because I did
11 want to say that -- that our Board actually is
12 quite in support of aquaculture. It dates back
13 to the adoption of our 1988 Comprehensive Plan,
14 and it goes on to this day.
15 As I mentioned earlier in my remarks, we
16 have worked hard with the State to try to come
17 to agreement as to how aquaculture could best be
18 used. And it minimizes many of those conflicts
19 that you're referring to that people do object
20 to, the high density lease area in particular is
21 one way to get a concentrated activity in a way
22 that it's not scattered throughout the waters,
23 where it doesn't create navigational hazards,
24 where it really can be a benefit both to those
25 in the industry, as well as to the citizens in
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1 the county.
2 Again, I would say that I would certainly
3 agree with you that it is necessary and valuable
4 to support seafood industry. And I believe our
5 Board would feel that way as well.
6 We're simply saying to you that this is a
7 public resource which is, in our view,
8 undervalued, that there is a greater value of
9 these leases than the $15.58 per year per acre,
10 which is being charged now.
11 And again, that there may be others who
12 want to get into this industry, that may be
13 excluded if we provide 20-year leases.
14 TREASURER NELSON: Governor --
15 GOVERNOR CHILES: Yes, sir.
16 TREASURER NELSON: -- tell me something
17 about the County Commission's vote. Is this a
18 unanimous recommendation from the
19 County Commission?
20 MR. PEFFER: No, sir, it was not. It was a
21 4 to 1 vote. We had one commissioner
22 dissenting.
23 TREASURER NELSON: Okay. And that would
24 have been Commissioner Voltz?
25 MR. PEFFER: Yes, sir.
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1 TREASURER NELSON: Four to one.
2 MR. PEFFER: Yes, sir.
3 And I would like to say that you'd be
4 looking at a commissioner, rather than the
5 Assistant County Manager, had they not been
6 meeting today.
7 TREASURER NELSON: Right.
8 GOVERNOR CHILES: Other questions?
9 ATTORNEY GENERAL BUTTERWORTH: I just have
10 one problem, Governor. And just
11 philosophically, I guess in a way, I'm very much
12 in favor of these leases, but I -- it's the
13 20-year issue that gets me.
14 I wouldn't mind if we could do something
15 where -- where we can give them a 10-year, then
16 they have to come here for approval for the
17 second 10-year. No one else can compete against
18 them, but at least have just -- just go by us,
19 for the simple reason, in certain parts of this
20 state, maybe like -- like Brevard County,
21 ten years from now might be different
22 circumstances than today. Some of the areas of
23 the state that are not as rapidly growing, there
24 may not be any problem at all.
25 But I think this Board should at least have
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1 the opportunity just to review. And we can
2 probably even put some wording in there where
3 the intent should be, unless there's a reason
4 not to -- to renew it.
5 But just -- I'd just like to discuss it a
6 little bit, because I'd like to amend it
7 unless -- if there's any support for that.
8 COMMISSIONER BROGAN: Could I ask,
9 Governor, the 20-year issue I'm sure was
10 discussed. And is what the General is
11 advocating reasonable; if not, why not?
12 MR. GREEN: We think it is. The lease
13 condition is a 10-year lease condition. They
14 come back and ask for a renewal of that. So at
15 the renewal period, we could bring it back to
16 the Board.
17 ATTORNEY GENERAL BUTTERWORTH: I have no
18 problem --
19 MR. GREEN: That's with --
20 ATTORNEY GENERAL BUTTERWORTH: -- with
21 that.
22 MR. GREEN: -- their approval, if that's
23 the wish of the the Board.
24 ATTORNEY GENERAL BUTTERWORTH: -- I have no
25 problem.
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1 GOVERNOR CHILES: I think we have another
2 speaker, right, that's in favor of --
3 MR. GREEN: We've got two more speakers.
4 GOVERNOR CHILES: -- I want to hear that.
5 ATTORNEY GENERAL BUTTERWORTH: I thought it
6 was over. I'm sorry.
7 COMPTROLLER MILLIGAN: If I -- if I could,
8 Governor, one quick comment. I think what the
9 Attorney General is pursuing is a -- is a good
10 idea. But we are talking about policy here
11 now. And rather than a one-time policy shot, we
12 might want to really look at this as a policy
13 across-the-board.
14 GOVERNOR CHILES: What is the -- why is the
15 necessity of having -- automatically be able to
16 sublease?
17 MR. GREEN: The reason we asked for a
18 prohibition on subleasing, and --
19 GOVERNOR CHILES: You did ask for a
20 prohibition?
21 MR. GREEN: Yes, we did.
22 GOVERNOR CHILES: That is in the request
23 that's before us?
24 MR. GREEN: Yes, sir, it is.
25 GOVERNOR CHILES: All right. That's fine.
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1 That takes care of my --
2 MR. GREEN: Okay.
3 GOVERNOR CHILES: All right.
4 MR. GREEN: The next speaker is Kay Young.
5 MR. PEFFER: I just wanted to say
6 thank you, Governor Chiles, and members of the
7 Cabinet --
8 GOVERNOR CHILES: Thank you.
9 MR. PEFFER: -- for considering the Brevard
10 position.
11 GOVERNOR CHILES: Thank you, sir.
12 MS. YOUNG: Good morning. I'm Kay Young,
13 this morning representing the Florida Shellfish
14 Farmers Association. This is a small group of
15 shellfish farmers very vitally interested in
16 these leases.
17 And the bottom line this morning for us is
18 that these 44 leases be granted. There are a
19 number of other issues, as you've heard, that
20 have come up.
21 But we are fairly desperate out there for
22 these leases to get awarded. This has been
23 going on, depending on who you talk to, at least
24 17 months, some people say since 1993.
25 So there are people who have been calling
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1 me over the last two weeks, some literally in
2 tears, families wanting to know about these
3 leases and whether or not they'll be awarded.
4 So I hope that I can convey that to you strongly
5 enough that that's our number one priority.
6 After that, we have some questions for you,
7 or some things for you to consider. We're a
8 little worried about this encumbering future
9 leases. This is not something that is usually
10 done. And so far it's been working pretty well
11 to bring them to you and have you decide at the
12 time what you want to do with each lease.
13 If we put special considerations on future
14 leases, there are a number of things we're
15 worried about there. For one thing, these are
16 the leases, part of them, the 40 acres that will
17 be reserved for the out of work fishermen.
18 And I know Jerry Sansom will be talking to
19 you about that issue.
20 We don't want to do anything to put any of
21 them at a competitive disadvantage after all
22 they've been through.
23 Two specific issues. Now, we did want to
24 say, too, that DEP and the County have worked
25 wonderfully with us. And the industry signed
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1 off on those 13 things that are in there, all
2 the different parameters that Mr. Peffer talked
3 about.
4 We -- we did so during the time that the
5 leases would have been vetoed by the County if
6 we hadn't. So there are a couple of things
7 there that we really are concerned about.
8 And one is the bidding of possible future
9 leases. Our reason for concern there is that
10 we're afraid the local community people may not
11 be competitive in the bidding process. That's
12 their fear. They fear having outside interests
13 come in, bid up the leases for a short period of
14 time, they would go out of business if they lose
15 their boats and -- and bags for awhile, and then
16 couldn't get back into it.
17 So the bidding is something that we -- we
18 really have a lot of concern about.
19 And then there's the overall concern of
20 just putting any parameters into the future on
21 leases. We'd rather for you to look at them as
22 they come up.
23 I wanted to mention quickly in talking
24 about the lease term --
25 Get a sip of water here.
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1 -- that the 10-year lease term -- 10 years
2 sounds like a long time. But this is not a
3 building. It's not something that we can use
4 immediately.
5 They say it takes two years, especially in
6 Brevard County where the water is fresher, and
7 it takes a little longer for the clams to grow.
8 But it takes a couple of years where they're
9 just putting money in. They figure they're down
10 about $77,000 in two years.
11 The third year they begin to harvest, they
12 may make 30,000 on a five-year lease. And all
13 these are ballpark figures. It's hard to get
14 definite figures. But these are close.
15 So they're paying back that $77,000. Same
16 with the fourth year. By the fifth year they're
17 making money. So years five, six, seven, eight
18 they're making money, $30,000 a year. And many
19 of these are families working. These are family
20 businesses.
21 So then the last two years, if there's any
22 doubt about this lease being renewed, they may
23 not even plant, because that would take them
24 another couple of -- of years to get clams off
25 the last two years.
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1 So essentially they've got that middle four
2 or five years that they're working with at
3 $30,000 a year. Those are approximate figures
4 for you to think about.
5 So I'd like to just leave you with a couple
6 of other quick thoughts. Even though there's
7 been all of this concern from the county and --
8 and we've all worked so hard to work out all the
9 problems there have been down there, there was
10 only one citizen complaint during the 30-day
11 notice period. Only one. And that was for a
12 riparian lease.
13 And DEP looked at that complaint and wisely
14 moved it. So that took away that complaint.
15 So essentially there were no citizen
16 complaints during the 30-day period. So in
17 thinking about the big picture in awarding the
18 leases, I just wanted you to know that.
19 And also, when you talk about total amounts
20 of land -- total amounts of water, this whole --
21 if you build out to the extent of the reserved
22 area in Brevard County, that would only be
23 2.12 percent, DEP tells me, of the available
24 shellfish waters. Now, that's not even total
25 water. Total water, it's less than 1 percent.
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1 These are bags on the bottom no more than
2 6 inches off the bottom. These are clams down
3 there. Nothing foreign, native clams.
4 So we certainly appreciate your support of
5 aquaculture in the past, and we hope you'll
6 consider these points as you make your decision.
7 Thank you very much.
8 GOVERNOR CHILES: Thank you.
9 Any questions?
10 COMMISSIONER CRAWFORD: I have a quick
11 question.
12 How does the leases that are proposed today
13 compare with leases that we've already approved
14 in the past?
15 MS. YOUNG: In the past. There are two
16 special considerations on these leases, if
17 you're just talking about the lease document,
18 which is the last few pages of your agenda
19 item. The two special conditions in these
20 leases are that there be no subleasing, and that
21 if anyone commits a crime against an upland
22 property owner, they'll have their lease taken
23 away.
24 Now, we certainly don't object to that
25 one. That shouldn't happen. If they do, they
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1 don't deserve to have a lease.
2 The subleasing some of my people have
3 problems about. But they feel they signed off
4 on this, so they don't -- they don't really know
5 what to say about that one. They're a little
6 worried about it.
7 The other main difference,
8 Commissioner Crawford, is that all of this
9 language encumbering future leases worries us a
10 lot. And I don't know how binding that is to
11 you all.
12 So -- did that answer your question?
13 COMMISSIONER CRAWFORD: Okay. Thank you.
14 GOVERNOR CHILES: Thank you, ma'am.
15 MS. YOUNG: Thank you very much.
16 GOVERNOR CHILES: Well, I think if I was
17 given the choice --
18 MR. GREEN: Jerry Sansom.
19 GOVERNOR CHILES: -- did I want a lease
20 with the ability to sublease, I'd love to have
21 the ability to sublease.
22 But when you really look back on this,
23 I believe that we've got old leases that we've
24 made years ago that the families are no way
25 connected with them, other than just selling
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1 them off on the sublease.
2 It seems like what we're trying to do is
3 give somebody the right to be able to make a
4 living out there off of the State lands. And I
5 don't know why that right should be just won
6 because your great grandfather got a lease
7 sometime, and you get a chance to sell it, or
8 sublease it forever.
9 COMMISSIONER CRAWFORD: Right.
10 MR. GREEN: Jerry Sansom.
11 MR. SANSOM: Thank you.
12 Governor, members of the Cabinet, it's good
13 to see you all again.
14 I'm here representing the Organized
15 Fishermen of Florida, which, as y'all know, has
16 sort of traditionally been the harvesters of the
17 wild product. But in recent years, we've had to
18 move more and more into the areas, like
19 Commissioner Brogan says, of trying to optimize
20 the two.
21 And we're very concerned about the
22 conditions that go along with the approval of
23 these leases.
24 Some of these people have been waiting
25 since they -- according to the staff report,
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1 since '83. Certainly -- I mean, '93. Certainly
2 since '95 when the County put a moratorium.
3 And as Kay indicated, the agreements
4 between industry and the County on this was when
5 the County had a loaded gun to our head and we
6 were defenseless. You agree to a lot when you
7 have a loaded gun to your head, and your hands
8 are tied behind your back, and you can't do much
9 other than that.
10 As some of you will remember, about
11 ten years ago, we had a hurricane come through
12 Apalachicola. And at that time,
13 Governor Martinez and some of the Cabinet
14 members approved a program to teach displaced
15 Apalachicola oyster fishermen whose oyster beds
16 had been covered up with silt how to grow
17 oysters under farm raised conditions. Went
18 through a two-year program. I think a couple of
19 million dollars was spent.
20 And they went before the County Commission
21 to get 1-acre leases, and the County says, no,
22 we ain't going to -- we're not going to grant
23 you any leases. We don't like leases. Boom.
24 You can still see the poles over there in
25 one section of Ap-- of Apalachicola Bay where
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1 they had their training program, their test
2 area. And then when it came to get in the
3 business, the County Commission says, nope, we
4 don't like leases, we're just not going to do
5 it.
6 That got a lot of people mad, but not mad
7 enough to really do anything. And,
8 unfortunately, our County Commission in
9 Brevard County -- and we've worked with folks
10 like Steve and other folks in the County
11 administration for years, and they're good folks
12 to work with. But sometimes our
13 County Commissioners do take that attitude,
14 Commissioner Brogan, of you're talking about,
15 of -- of they want all these things but they
16 just don't want them where they can see them or
17 hear them, or where folks that can call them up
18 know about them and can see them or hear them.
19 And they decided, because they were getting
20 a -- a number of applications, that they'd put a
21 moratorium on applications, they'd look at an
22 aquaculture plan, and these kind of things,
23 which is all good stuff. But then they got
24 unreasonable.
25 They wanted to charge these aquaculture
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1 farmers an extra fee that would go into the
2 county's coffers, allegedly to do the water
3 testing that the County was going to have to do
4 to maintain water quality in the county. And
5 some other things.
6 So thank goodness the Legislature, after
7 the example of Franklin County, and now
8 Brevard County, says this is simply not
9 working. We can't have these local county
10 governments having veto authority over the
11 utilization of State lands.
12 They have the right, just like we do, to
13 come and appear before y'all, but that's
14 basically it. And that's all it should be,
15 because y'all make the decisions and y'all make
16 the -- set the policy on that.
17 The request you have before you here today,
18 like Kay, we need you to approve these
19 44 leases. These people need to get on with
20 their lives. They've been in limbo for
21 two years.
22 While Brevard County did approve and pass a
23 resolution supporting the work force development
24 group setting up a program for displaced net
25 fishers, they never did it. They never set it
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1 up. They never did it.
2 Now, part of this plan that they have set
3 aside 40 acres for those folks, if and when they
4 ever put together a program, and if and when
5 they ever decide to fund it. But those people
6 are going to have to competitively bid for those
7 leases.
8 Now, that sounds a little strange. Also
9 since this situation started, we've opened up a
10 whole other body of water in Brevard County, the
11 Banana River, that is now tested and approved
12 for shellfish harvest.
13 Our industry, the shellfish industry, paid
14 license funds to have that body of water tested
15 and certified, because as I'm sure as y'all
16 know, waters where shellfish harvest, even if
17 there is not a single person living within
18 2,000 miles, they're not certified for approved
19 shellfish harvest until they're tested. They're
20 assumed to be unsafe until they're tested and
21 certified to be safe, which is as it should be
22 with shellfish harvest.
23 These conditions -- if y'all agree with the
24 conditions that go along with the leases; that
25 is, if you agree with the Brevard County
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1 aquaculture plan -- you will limit the leases in
2 Brevard County to simply these additional
3 340 acres. No more. Period. That would be
4 y'all's -- y'all would be adopting that policy.
5 So this whole acreage of -- of the
6 Banana River would simply be lost to available
7 aquaculture if there are sites in there, and we
8 believe there are, that are suitable for
9 aquaculture usage.
10 Because, remember, in order for a piece of
11 bottom to be available for a lease, it has to be
12 currently unproductive. It's not like we're
13 leasing productive clam bottom or productive
14 bottom. The whole philosophy here is to take
15 unproductive bottom with a minimal amount of
16 existing shellfish, and by adding to it, of
17 putting it into production. And that's the
18 reason that the 10-year thing is so important,
19 being able to renew.
20 And, General Butterworth, we certainly do
21 not have any problem with your suggestion that
22 when the renewal time comes up, that these be
23 brought back before -- before y'all. That's --
24 we're perfectly in agreement to do that.
25 But what we would prefer you do, if you can
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1 do this -- and like Kay, the bottom line is
2 you've got -- we really do request that y'all
3 approve these today. And nothing that I'm
4 saying here in any way do -- should -- let y'all
5 believe that I want you to hold this thing up
6 while you look at these other things, because I
7 don't.
8 But Item 1 here of -- to approve
9 approximately 340 acres, if the intent of that
10 approval is that's all that there ever will be
11 in Brevard County, we don't think that's
12 appropriate.
13 Because like I say, the Banana River wasn't
14 even open and available for consideration when
15 this negotiation, if you will -- and I don't
16 consider it negotiation unless both sides are
17 loaded. One doesn't really make a negotiation.
18 To me, that's hostage or extortion, or whatever
19 you want to call it.
20 And -- but Section 2 and 3 here -- Item 2
21 and 3, the issuance of the 37 leases; and, 3,
22 the additional seven 5-acre leases, those are
23 okay. We need you to do this.
24 But in Item 4, make the remaining acreage,
25 which is the -- the unleased under 340 --
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1 subject of this available lease conditions, we
2 really wish y'all wouldn't bind those future
3 applicants to those conditions.
4 Let's keep talking with them, let's keep
5 working with the county, let's keep working on
6 this thing, and have the rest of these come back
7 to you. Because one of the requirements is that
8 all future leases be by competitive bid. That
9 certainly doesn't help the small displaced
10 fisherman.
11 One of these conditions is, the total
12 acreage for all aquaculture leases will be
13 limited to 520 acres, period. As Kay said,
14 that's less -- that's a little over 2 percent of
15 the available shellfish waters. It's less than
16 1 percent of the waters in Brevard --
17 GOVERNOR CHILES: Are you --
18 MR. SANSOM: -- County.
19 GOVERNOR CHILES: -- talking about our --
20 the motion of the Department, or are you talking
21 about the county plan?
22 MR. SANSOM: No, sir. That's the -- that's
23 the recommendation of the Department, have these
24 included.
25 COMMISSIONER CRAWFORD: So if we -- if we
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1 strike provision 4 and pass the rest of it, is
2 that kind of what you're --
3 MR. SANSOM: One and four. Because 1
4 specifically limits to the 340 additional acres;
5 and 4 includes that -- 4 is basically agreeing
6 to the county plan, which also includes that.
7 COMMISSIONER CRAWFORD: Uh-hum.
8 COMMISSIONER BROGAN: Well, it would seem
9 to me -- I understand your concern on Number 1
10 about the 340 acres, and I understand how your
11 concern relates to Items 4 --
12 MR. SANSOM: Yes, sir.
13 COMMISSIONER BROGAN: -- and 5 as well,
14 because one may impact the other if --
15 MR. SANSOM: Well, 4 -- excuse me. Four
16 has the 540-acre limitation included --
17 COMMISSIONER BROGAN: Yes.
18 MR. SANSOM: -- as the special conditions.
19 COMMISSIONER BROGAN: But I guess --
20 I guess back to Commissioner Crawford's point,
21 if Item 4 is not there, relative to the total
22 package, then Item 1 would simply have the
23 effect of approving the 340 acres, which would
24 be exactly what you want to do, and not further
25 restrict the use of the Banana River property,
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1 et cetera.
2 MR. SANSOM: Yes, sir. As long as the
3 understanding was, the approval of Item 1 was
4 simply that you now have 340 acres approved for
5 aquaculture leasing, and that -- that means
6 nothing beyond that.
7 COMMISSIONER BROGAN: Well then, without
8 Item 4, I think it would probably --
9 MR. SANSOM: It could be --
10 COMMISSIONER BROGAN: -- do just that.
11 MR. SANSOM: -- yes. I would certainly --
12 COMMISSIONER BROGAN: If you --
13 MR. SANSOM: -- prefer to --
14 COMMISSIONER BROGAN: -- in other words,
15 you've got to have the 340 acres to approve
16 these leases. But I understand your concern
17 about how Item 1 relates to Item 4 --
18 MR. SANSOM: Yes, sir.
19 COMMISSIONER BROGAN: -- and they --
20 MR. SANSOM: Well, I certainly --
21 COMMISSIONER BROGAN: -- appear in
22 harmony --
23 MR. SANSOM: -- would prefer --
24 COMMISSIONER BROGAN: -- with Item 4 to be
25 pretty restrictive.
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1 MR. SANSOM: Yes, sir.
2 And, Governor, your issue on subleasing,
3 I think your comments may have been more
4 appropriate to those certain perpetual leases
5 that exist in some parts of the state. But
6 these are not -- these don't fall into that
7 category. These aquaculture leases are not the
8 perpetual leases.
9 And as this demonstrates, acquiring these
10 leases is sometimes a tough and expensive and
11 long process, and sometimes it's important for a
12 small group of fishermen to get together and
13 apply under one person's name for the leases.
14 And they'll sublease the group to each
15 other so that the little guy can get in without
16 having to have all the money up-front and still
17 be subject to all the conditions.
18 And we certainly don't have a problem with
19 any sublessee being subject to the same
20 conditions as the primary lessee so that the
21 Department has accountability.
22 But that's the -- that's sort of the
23 underlying issue from our perspective on the
24 subleasing. And I certainly, you know,
25 appreciate your concern where -- where there
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1 were the permanent leases as you said, because
2 somebody's grandfather had it, and they're not
3 using it any more.
4 But those aren't given out any more. Y'all
5 don't -- y'all don't do that any more.
6 GOVERNOR CHILES: Well, you guys --
7 MR. SANSOM: But you guys never did.
8 GOVERNOR CHILES: That may --
9 MR. SANSOM: That was --
10 COMMISSIONER BROGAN: -- be taken care of,
11 the fact that the 10-year lease may be taking
12 care of the problem I had with it.
13 COMMISSIONER CRAWFORD: Governor, I'd like
14 to move the -- have we got another speaker,
15 or --
16 MR. SANSOM: Thank you, Governor.
17 GOVERNOR CHILES: Thank you.
18 MR. GREEN: I'm sorry. The last speaker
19 didn't sign in. So it's Pat Rose.
20 MR. ROSE: Governor, members of the Board,
21 it was not originally my intention to address
22 you, because, I believe, as things were working
23 out with the county involvement and the staff
24 review and recommendations as the item as a
25 whole --
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1 First of all, I'm representing Save the
2 Manatee Club.
3 The 340 plus acres before you, the
4 500 acres mentioned, are all areas that are very
5 important manatee habitat. However, we've been
6 trying to look at this as an issue, that it is
7 important to involve the aquaculture farmers.
8 I was involved in the legislative issues
9 that have been working with aquaculture. We've
10 been working with that lobby, we've been working
11 with those individuals in this process. And
12 it's not our purpose to try to stop aquaculture
13 leasing in Brevard County. We want to take a
14 good balanced approach with that.
15 What you have are areas that have been
16 looked at very carefully. Even those areas are
17 going to cause conflicts, and there are going to
18 be controversy within those. But we felt that
19 this was something that was evolving with a lot
20 of input and understanding.
21 The most serious concerns that I've heard
22 that bring us -- and bring me here today to
23 address you, is that if we're looking at
24 expanding this beyond -- substantially beyond
25 what has already been talked about, those
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1 conflicts are going to be getting much more
2 severe. And particularly, as you get into the
3 Banana River system, I don't know how it's going
4 to be able to be done, and done in a safe
5 fashion.
6 So rather than getting off on what might be
7 in the future, I would urge you not to depart
8 from the Brevard County plan that's been worked
9 out with the Department on those issues.
10 I also don't want to give the impression
11 that we're opposed to aquaculture, per se. As
12 we look at the multiple competing interests of
13 these State sovereign lands, the public
14 interest, the resources of the manatees, the
15 sea grasses, what you have is you -- when you
16 look at these areas carefully, you can begin to
17 delineate places where this work can be done
18 safely, and with the least amount of conflict.
19 As you begin to expand that substantially
20 beyond what's before you, those conflicts are
21 going to increase; the adverse impacts to
22 sea grasses are going to continue; and they're
23 going to expand; the direct impacts to manatees,
24 which are our primary interest, and their
25 habitats, are going to be getting quite
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1 controversial.
2 So I urge you, please, don't depart from
3 what has been brought before you in a pretty
4 orderly fashion. Brevard County took the
5 initiative to develop a plan that looked at this
6 much more comprehensively. And that's what we'd
7 urge you, that that's what needs to happen,
8 rather than piecemeal, we come in with a certain
9 number of acreage, and then another and another,
10 to the point which those conflicts are such a
11 great conflict that it's brought into turmoil,
12 that you have to again sort of play Solomon and
13 cut the baby in half.
14 And we'd like not to -- to see that happen
15 as well.
16 And we thank you for that time.
17 GOVERNOR CHILES: Thank you.
18 MR. GREEN: Just a couple of points of
19 clarification.
20 There are 40 acres involved in the
21 remaining 120 acres within this plan that are
22 for displaced fishermen that are not subject to
23 the bidding process that we've asked for in Item
24 number 4 of our recommendation.
25 Item 4 of our recommendation was to
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1 delegate to staff the ability to move forward
2 with those leases so that we could do it in a
3 more timely manner. If we don't want to do
4 that, we can just bring them back to the Board.
5 The 540 acres is a plan that we put
6 together with Brevard County trying to address
7 their issues and open up aquaculture so that we
8 could get some aquaculture into the County.
9 That's a guide. It's not an absolute. But
10 we would be strongly guided by that in the
11 future. Those are in the high density areas.
12 People still have available to them the ability
13 to make application for single aquaculture
14 leases outside of those high density areas that
15 we would consider and bring to you.
16 So those are some clarifications of points.
17 COMPTROLLER MILLIGAN: Could I get a
18 clarification, Governor?
19 Are we establishing as policy now that
20 there'll be no subleasing?
21 COMMISSIONER CRAWFORD: I think -- if I
22 could answer that.
23 I think unless we change that in these
24 leases, although we haven't done it before, this
25 would prohibit the subleasing, which I would --
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1 COMPTROLLER MILLIGAN: In all future
2 leases.
3 COMMISSIONER CRAWFORD: Well, in these
4 leases. I --
5 COMPTROLLER MILLIGAN: Yeah. I understand
6 that.
7 COMMISSIONER CRAWFORD: Yeah.
8 COMPTROLLER MILLIGAN: But this is not a
9 policy issue in terms of future leases, that we
10 will address this time and time again, I
11 presume, in the future.
12 And the same thing -- and the same thing on
13 the competitive bid. This is not a policy
14 issue. We'll address it again in the future on
15 a case by case basis.
16 MR. GREEN: That's correct. The reason we
17 put in the no subleasing is we -- we began to
18 hear that in other areas of the state where we
19 had entered into aquaculture leases, that some
20 subleasing may be going on where increased
21 values were being added to -- to the lease at
22 sublease.
23 We don't have a firm grip on that yet, and
24 we may very well come back to you, and ask you
25 to establish that as a policy if we find that
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1 there's a windfall from the original lessee to a
2 sublessee.
3 But until we get some documented proof on
4 that, we're not asking for that as an absolute
5 policy.
6 COMPTROLLER MILLIGAN: And this is a
7 20-year lease.
8 MR. GREEN: This is a 10-year lease --
9 COMPTROLLER MILLIGAN: -- 10-year lease,
10 automatic --
11 MR. GREEN: -- with a 10-year --
12 COMPTROLLER MILLIGAN: Yeah.
13 MR. GREEN: -- that we will bring to you
14 before we do that.
15 COMMISSIONER CRAWFORD: Well, I would just
16 think that with that 10-year limitation, the
17 windfall is not going to be that much, because
18 you're talking about a fairly small amount of
19 money here. And at the end of the 10 years,
20 when we get a chance to look at them again, at
21 that point, we determine there's windfall is
22 then, you know, I think we could take action at
23 that point.
24 But I -- I don't -- I think that limitation
25 of the 10 years certainly dampens any potential
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1 problem in that area.
2 So I would move the -- I'm not sure if this
3 is the right way to do it. I'm going to just
4 try this.
5 But I would move the staff recommendation
6 with -- but delete provisions Number 4, and also
7 delete -- if -- if it's not encased in Number 4,
8 also delete the prohibition against the
9 subleasing.
10 So we -- we would be passing the -- the
11 staff recommendation with no prohibition at
12 subleasing.
13 And I -- and basically the intent is to not
14 make a statement that we're not going to do any
15 more than a certain amount, but basically leave
16 that open as a policy consideration for the
17 Cabinet as we take up future leases, or not take
18 them up. I think that can be our choice.
19 But as Commissioner Brogan said earlier,
20 aquaculture is a very important asset to the
21 State if we're going to take the pressure off
22 our natural resources, and our -- and the
23 natural habitat, which we're all concerned
24 about.
25 But at the same time, aquaculture is a new
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1 industry. The State has spent some money and
2 some time trying to get it going. And I think
3 that's a little bit of what's going on here
4 today, we need to kind of help it along some if
5 we're going to get the positive benefits, not
6 only to the consumer, but to the -- to our
7 natural resources.
8 I would hope -- I would hope we could do
9 these leases in a way that's -- that makes sense
10 to get the industry up and moving. And I think
11 that motion might accomplish what we're trying
12 to do.
13 COMMISSIONER BROGAN: Could I -- I think
14 I'm about to second your motion.
15 But could I -- could I ask a question,
16 first, Governor?
17 GOVERNOR CHILES: Yes, sir.
18 COMMISSIONER BROGAN: If I -- if I heard
19 the discussion correctly -- I'm going to work on
20 a belief, and that is that if we were only
21 dealing with the leases before us today, that
22 both -- or including the Brevard County
23 Commission, the Department, and those who would
24 be directly impacted by those lease agreements
25 would essentially -- especially with the
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1 modification the Commissioner was talking
2 about -- be in agreement with Items 1, 2, and 3
3 in the recommendation.
4 Am I correct in that regard?
5 MR. GREEN: I don't want to speak for the
6 county, but I think the county --
7 COMMISSIONER BROGAN: Understood.
8 MR. GREEN: -- had a strong recommendation
9 not to be able to sublease.
10 So with -- with the motion on the floor,
11 with the exception of the sublease, no sublease
12 criteria, then I think the county --
13 everyone's --
14 COMMISSIONER BROGAN: Okay.
15 MR. GREEN: -- in agreement.
16 And Ed Conklin just told me, the cap was a
17 big issue for the county also.
18 COMMISSIONER BROGAN: The what, I'm sorry?
19 MR. GREEN: The cap. The 540 acres.
20 COMMISSIONER BROGAN: The -- then I'm going
21 to continue the line of thought there.
22 Then Items 4 and 5 in the recommendation
23 would be subject to further review, based on the
24 policy implications. I think we've heard some
25 discussion relative to future acreage,
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1 Banana River issues, et cetera, et cetera.
2 So what I'm trying to do here -- and I'm
3 trying to agree with the --
4 COMMISSIONER CRAWFORD: Okay.
5 COMMISSIONER BROGAN: -- Commissioner -- is
6 get these leases approved without getting the
7 leases approved and being put in a position of
8 accepting a significant amount of other
9 information that we may not be in a position to
10 get our arms around today.
11 I think we can do one without doing the
12 other today, if I understand the motion
13 correctly.
14 COMMISSIONER CRAWFORD: Yes.
15 MR. GREEN: And I think that's the position
16 you're in with that motion.
17 COMMISSIONER BROGAN: And to that end,
18 Governor, I would like to support the motion.
19 GOVERNOR CHILES: All right. It's been
20 moved and seconded.
21 Is there further discussion?
22 Many as favor, signify by saying aye.
23 Opposed --
24 THE CABINET: Aye.
25 GOVERNOR CHILES: -- no.
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1 The motion is adopted.
2 MR. GREEN: That's the only item on -- on
3 that agenda.
4 I understand we have a time certain for the
5 DEP agenda?
6 GOVERNOR CHILES: That's correct. And we
7 will reconvene at that time.
8 And I wanted to announce that our Clemency
9 meeting will be convened at 1:30 tomorrow
10 afternoon, rather than earlier as it was
11 designated before.
12 MR. GREEN: And that time is 1:00 p.m. --
13 1:00 p.m. today for -- for the orimulsion
14 hearing.
15 COMPTROLLER MILLIGAN: Yes.
16 GOVERNOR CHILES: Is that what we --
17 Yes. That's correct.
18 (The Board of Trustees of the Internal
19 Improvement Trust Fund Agenda was concluded.)
20 (Recess.)
21 *
22
23
24
25
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1 CERTIFICATE OF REPORTER
2
3
4 STATE OF FLORIDA:
5 COUNTY OF LEON:
6 I, LAURIE L. GILBERT, do hereby certify that
7 the foregoing proceedings were taken before me at the
8 time and place therein designated; that my shorthand
9 notes were thereafter translated; and the foregoing
10 pages numbered 1 through 98 are a true and correct
11 record of the aforesaid proceedings.
12 I FURTHER CERTIFY that I am not a relative,
13 employee, attorney or counsel of any of the parties,
14 nor relative or employee of such attorney or counsel,
15 or financially interested in the foregoing action.
16 DATED THIS 18TH day of SEPTEMBER, 1997.
17
18
19 LAURIE L. GILBERT, RPR, CCR, CRR
100 Salem Court
20 Tallahassee, Florida 32301
850/878-2221
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ACCURATE STENOTYPE REPORTERS, INC.