Exactions Bills in the 2014 Legislative Session Should Cheer Property Owners

The 2014 Florida Legislative Session convenes next Tuesday, and property owners should find some early cheer in a pair of bills: HB 1077 (Perry) and SB 1310 (Evers).

These bills bear a strong resemblance to two bills that did not pass last year: HB 673 and SB 772, both of which would also have limited the ability of local governments to impose exactions somewhat beyond the Nollan-Dolan test. As you might expect, this year's bills appear to have been tweaked to take into account the Koontz decision.

Even though the problem in Koontz was with the St. Johns River Water Management District, a state agency, local governments have really been the bigger culprits in leveraging exactions from property owners. That is probably why these bills are aimed at limiting the ability of local governments to exact payments for indirect impacts of development. Part of the bills restate the law after Koontz: governments can't require exactions that are unrelated to the impacts of development. The part that appears to be new to Florida is that regulatory overlap would be reduced because local governments would be prohibited from exacting more than a state or federal agency for the same impact. 

So where a state or federal agency must analyze an impact, it looks like local governments would largely have to accept that analysis. This might not sound like much, but it does at least put a ceiling on what a local government can demand in return for a permit if a state or federal agency is involved.

The text of the bills is below.

Section 1. Section 70.45, Florida Statutes, is created to read:

70.45 Local government development exactions.—

(1) The Legislature finds that in the land use planning and permitting process, a landowner or applicant may be especially vulnerable to excessive demands for relinquishment of property or money in exchange for planning and permitting approvals. The Legislature further finds that exaction demands beyond the direct impact of a proposed development are against public policy and are therefore prohibited.

(2) A county, municipality, or other local governmental entity may not impose on or against any private property a tax, fee, charge, or condition or require any other development exaction, either directly or indirectly, that:
(a) Requires building, maintaining, or improving a public, private, or public-private infrastructure or facility that is unrelated to the direct impact of a proposed development, improvement project, or the subject of an application for a development order or administrative approval.
(b) Is more stringent than an exaction imposed by a state or federal agency on or against the same property that concerns the same impact.  

(3) This section does not prohibit a county, municipality, or other local governmental entity, upon demonstration, from:
(a) Imposing a tax, fee, charge, or condition or requiring any other development exaction that serves to mitigate the direct impact of the proposed development and that has an essential nexus to, and is roughly proportionate to, the impacts of the proposed development upon the public, private, or public-private infrastructure or facility that is maintained, owned, or controlled by the county, municipality, or other local governmental entity.
(b) Accepting the voluntary dedication of land or an easement that has an essential nexus to, and is roughly proportionate to, the impacts of the proposed development upon the public, private, or public-private infrastructure or facility that is maintained, owned, or controlled by the county, municipality, or other local governmental entity and the development or proposed development is situated on the specific property to which the dedication of land or easement applies.  

Section 2. This act shall take effect July 1, 2014.

Florida Loses One of Its True Heroes

Florida has lost one of its heroes--and probably its greatest modern author. Patrick D. Smith has died at 86. This three-time Pulitzer Prizer winner wrote the best historical fiction ever written about Florida.

His most well-known book, A Land Remembered, follows a family through Florida's history. If you want to learn about Florida's cracker cowboys, its agricultural history, or the heartbreak of its pioneers watching it develop, it's for you. Even if you just like historical fiction, it's for you. If you've never read A Land Remembered, do yourself a favor and go buy it now.

The Florida Bar Takes on Social Media

If you're not a lawyer, skip today's post.

Those of you who are lawyers have likely heard about the Florida Bar's considerations of whether to regulate LinkedIn more stringently. Late last year, the Florida Bar's Board of Governors voted to rescind a staff opinion that would have done just that. Apparently, Bar staff was concerned that attorneys who don't purposefully opt out of LinkedIn's "skills and expertise" section that collects endorsements are violating rules concerning board certification. However, the Board of Governors voted to ask the Florida Bar's Standing Committee on Advertising to study the issue further.

I have grave concerns that the Bar will regulate even personal uses of LinkedIn. It has already done this with its guidelines on social media, for example. Many of you know that these ungainly guidelines for the use of social media show the Bar’s struggles to understand in how people actually communicate today. For example, those guidelines state that "[p]ages of individual lawyers on social networking sites that are used solely for social purposes, to maintain social contact with family and close friends, are not subject to the lawyer advertising rules." How do we differentiate between "social purposes" and other purposes? How do I know what a "close friend" is?

Tallahassee's Steven Hogan and I are collecting signatories for a letter that we're preparing for the Committee. Please email me if you're interested in reviewing the letter or signing on at jake [at] jacobtcremer [dot] com. We'll post the full letter here after it has been submitted.

The Permanence of Conservation Easements - Is Forever A Good Thing?

Bruce Ritchie has an interesting piece on his blog about the permanence of conservation easements. He notes that these easements are supposed to be "perpetual," and he explores whether this means "forever." He also explores whether this is a good thing or not:

Changes in climate or scientific understanding may reduce the public benefit of some purchases. Surrounded by development, an “island” of conservation may no longer be as valuable when weighed against the need for, say, a hospital. 

University of Virginia law professor Julia D. Mahoney wrote in a research paper that permanent conservation easements may create a legal mess for future generations. She argues that preservationists should rely on future generations to make wise land use decisions. 

“Such an approach would compel today’s preservationists to abandon the illusion that they can save nature through calculated efforts to restrict the options of future generations,” she wrote. “Their descendants, however, might thank them.”

It's a good question, since 425,000 of the state's 2.4 million acres (18%) of conservation land purchased since 1990 are through conservation easements.

I explained my own views on this in a 2010 article in the Environmental Law Report, Fighting the Lure of the Infinite: Lease Conservation Easements at the Urban Fringe. In it, I argued that contrary to popular opinion, perpetual conservation easements are less useful than at the urban fringe:

Today, local, state, and federal governments provide incentives intended to conserve agricultural uses. One of those incentives, the conservation easement, is flourishing in both quantity and acres conserved. Perpetual conservation easements are generally assumed to be superior to shorter term lease conservation easements because of a preference for stronger, more permanent restrictions. Some commentators question the sensibility of this preference, pointing out that citizens are most often interested in conserving agricultural land on the urban fringe. This type of land use is best conserved by lease conservation easements, and least likely to be conserved by perpetual conservation easements. Alternatives, such as state and federal amendments allowing lease conservation easements to receive the same tax benefits as perpetual conservation easements, may allow for more effective conservation of agricultural uses of land.

What do you think?

Developments of Regional Impact to Surface in 2014 Legislative Session

Bruce Ritchie recently wrote a good summary in the Florida Current of a bill concerning Developments of Regional Impact (DRIs). Here's an excerpt:

A bill filed in advance of the 2014 legislative session would allow six more counties to avoid review by the state of some growth management decisions, continuing a trend in recent years of increasingly less state oversight. 

In 2009, the Legislature passed SB 360 exempting counties designated as "dense urban land areas" from state review for "developments of regional impact." Environmental groups requested a veto but then-Gov. Charlie Crist signed the bill. 

For years, developers and some cities and counties supported less review of those larger developments because of the longer timeframe required for approval. Some developers also try to avoid passing thresholds, such as the number of homes in a proposed project, that would trigger state review. 

The 2009 legislation exempted those developments of regional impact (DRIs) from state review in counties with populations of 900,000 and at least 1,000 people per square mile of land area, unless the proposed developments were in designated "urban service areas" around cities. 

In 2013, 242 cities met the requirement along with eight counties: Broward, Duval, Hillsborough, Miami-Dade, Orange, Palm Beach, Pinellas and Seminole. 

SB 372, filed by Sen. Bill Galvano, would provide the dense urban land area designation to counties with at least 300,000 or densities of 400 people per square mile. 

Fourteen cities would fall within the exemption along with six additional counties: Brevard, Lee, Manatee, Pasco, Sarasota and Volusia, according to Galvano's office.

There is commentary from interested parties, including yours truly. As I mention in the article, it seems like a good idea to continue to test the Legislature's renewed interest in letting communities run their own show. In the most populated local jurisdictions, there does not seem to be as much of a need for the cumbersome DRI process as there may have been in the past.

Florida's New Environmental Resource Permit Rules

As you may have heard, Florida environmental resource permit (ERP) process has been overhauled and streamlined with the Statewide Environmental Resource Permit (SWERP). The Florida Bar Journal recently ran a good piece on the subject, "New Environmental Resource Permit Rules," written by Susan Roeder Martin. Susan is a senior specialist attorney with the South Florida Water Management District. It's always nice to see pieces like this by agency attorneys to give those of us in private practice an insight into working with them. Ms. Martin begins with a quick backgrounder on the program:

Florida’s water resources are regulated pursuant to the Environmental Resource Permit (ERP) program under Part IV of F.S. Ch. 373. This broad regulatory program went into effect on October 3, 1995, and applies to activities that involve the alteration of surface water flows, including new activities in uplands that generate stormwater runoff from upland construction, as well as dredging and filling in wetlands and other surface waters. The program covers everything from residential and commercial development in wetlands and uplands, to construction of roads, to certain agricultural alterations that impede or divert the flow of surface waters.

ERP applications are processed by either the Department of Environmental Protection (DEP) or one of the state’s five water management districts in accordance with the division of responsibilities specified in operating agreements between DEP and the individual water management districts. The ERP program is in effect throughout the state. 

Each of the five water management districts has historically had different rules for processing ERPs. The rules of each of the water management districts were also adopted by DEP and are utilized by DEP in processing permits. While the environmental criterion was substantially the same in all the water management districts, the processing and administration varied.

The problem with ERP, though, was that this variety led to a lot of confusion and disagreements across the districts; hence the need for the SWERP. After discussing the Legislature's directive for development of the SWERP, Ms. Martin details the permit categories, statutory and rule-based exemptions, fees, and procedures. She then includes a detailed discussion of how under the new SWERP, there are still differences across the districts. The Applicant's Handbook now provides the mechanism by which the districts can differentiate their procedures:

In the pre-statewide ERP rules, each of the five water management districts’ technical criteria was set forth in a separate volume known as the applicant’s handbook (AH) or the basis of review (BOR), incorporated by reference into each water management district’s rules. Each AH or BOR was also adopted by reference by DEP. The pre-statewide ERP AHs and BORs include environmental, water quality, water quantity, and procedural criteria.

***

What was formerly referred to as the AH or BOR in each water management district is now called the Environmental Resource Permit Applicant’s Handbook Volume II for Use within the Geographic Limits of the Applicable Water Management District (AH II). AH II includes water quality and quantity design and performance standards, hydrologic basins, and regional watersheds applicable to each water management district. The retention of these provisions in the individual AH II and the retention of special basin criteria satisfies F.S. §373.4131(1)(c)2, which requires that the rules account for different physical or natural characteristics, including special basin considerations, of each water management district. AH II is not generally applicable to 1) projects that cause no more than an incidental amount of stormwater runoff, such as a single-family home up to a quadruplex, which is not part of a larger plan of development; 2) stand-alone in-water projects and shoreline stabilization type projects; 3) docks and piers; 4) activities that do not add more than a de minimis amount of impervious surface; 5) exempt activities; and 6) activities that qualify for a general permit.31

Importantly, water quality and quantity criteria from each water management districts’ AH or BOR are retained. With respect to design and performance standards for stormwater quality and quantity, each water management district, with DEP oversight, may continue to adopt rules on these subjects.32 The criteria set forth in AH II further the goal of meeting the water resource objectives in Part IV of F.S. Ch. 373. Performance criteria were used when possible.

Many thanks to Ms. Martin for this informative article. If you'd like more information, check out DEP's SWERP website, or the webinar produced by the Florida Bar's Environmental and Land Use Section.

The Aftermath of Koontz - An Update and Review of New Scholarship

What's going on with Koontz, you might be wondering? Koontz v. St. Johns River Water Mgmt. Dist., 133 S. Ct. 2586 (2013). For readers just joining us, this was the exactions case where the U.S. Supreme Court ruled for landowners (1) that the Nollan-Dolan exactions test applies even where a permit is denied because an applicant rejects an exaction, and (2) that the Nollan-Dolan exactions test applies to exactions other than real property, such as where a permit applicant is required to pay for work.

For one, scholars are starting to crank out some interesting work on the case and its future effects:

• In Two Steps Forward for the 'Poor Relation' of Constitutional Law: Koontz, Arkansas Game & Fish, and the Future of the Takings Clause, Prof. Ilya Somin at George Mason describes how Koontz helped property rights enjoy a "modest revival" in the last term of the U.S. Supreme Court.
• In Koontz: The Very Worst Takings Decision Ever?, Professor Echeverria at Vermont, who has never seen a takings decision that he found supportable, discusses why he finds nothing redeeming in Koontz. Exaggerate much?
• In Fees, Expenditures, and the Takings Clause, Professor Pidot at Denver undertakes a rather strained analysis to find that Koontz's application of the Nollan-Dolan exactions test should only extend those monetary exactions "that require a permit applicant to pay money to the government"(which he calls a fee), but not to "those that require a permit applicant to engage in activities that cost money, but do not transfer money to the government" (which he calls an expenditure). He worries "that much of federal environmental law could become subject to" the Nollan-Dolan exactions test. Even if he is right, which I doubt, is there anything really that wrong with requiring that a permit regulation requiring the expenditure of money to be reasonably related to the purpose of the permit and be roughly proportionate the social harm of the permit?
• In Exactions Creep, Professors Fennell and Penalver at Chicago present a thoughtful analysis presenting the U.S. Supreme Court's exactions jurisprudence as the Court's attempt to deal with the problem of protecting property from the state with the power of the state. They argue - as I did in my amicus brief supporting the property owners in Koontz - that the Due Process Clause is the best way to balance the concerns of the government with property owners' rights.
• In Nollan and Dolan and Koontz – Oh My! The Exactions Trilogy Requires Developers to Cover the Full Social Costs of Their Projects, But No More, Christina Martin at the Pacific Legal Foundation, argues just what I have been saying since I first read Koontz: "Koontz, like Nollan and Dolan, recognizes that government may legitimately require landowners to carry their own weight, mitigating their development plans so that they do not impose costs on their community. But government cannot use the permitting process to coerce landowners into giving up more. That simple rule will not end land-use planning or permit negotiations."

Which brings us to the next update. Recall that the U.S. Supreme Court punted Koontz back to the Florida Supreme Court. Well, the Florida Supreme Court just punted the case back to the lower appellate court for further proceedings. The docket shows:

In light of the decision of the United States Supreme Court in Koontz v. St. Johns River Water Management District, 133 S. Ct. 2586 (2013), this case is hereby remanded to the Fifth District Court of Appeal for further proceedings consistent with that decision.

Looks like the Koontz's long battle continues.

To Review Comprehensive Plan Consistency, Go With What The Development Order Says, Not What the Developer (Or Government) Says

My posting has been sparse lately, and there are a number of cases that deserve some attention.

First up is U.S. Sugar Corp. v. 1000 Friends of Florida, - So. 3d -, 38 Fla. L. Weekly D1687 (Fla. 4th DCA Aug. 7, 2013). This case is short and sweet, and it stands for a simple point: in a comprehensive plan consistency challenge, the development order is evaluated by what the development order authorizes, and not what the developer says she is going to do under that development order (or the government, for that matter). That is, because development orders approved by a local government must be consistent with the local government's comprehensive plan. If they are not, then it is not enough for a developer to say that he or she will not undertake certain activities that are authorized by the development order.

In the 4th DCA's words:

Whether a development order is consistent with a comprehensive plan is determined by comparing what the order permits, not what the current holder intends to do under the order. The current order permits general commercial mining, a use prohibited under the comprehensive plan. The burden is on the applicant to show that the development order conforms strictly to the comprehensive plan. Machado v. Musgrove, 519 So. 2d 629, 632 (Fla. 3d DCA 1987). The adopted order is inconsistent with the plan. If in fact U.S. Sugar wants to mine in a manner consistent with the plan, then it should reapply and limit its application so that any order which grants the application would be properly consistent with the comprehensive plan.

The solution for landowners and developers is clear: don't overreach. If your project is not clearly authorized by the comprehensive plan, and the local government is willing to permit it, then you should amend the comprehensive plan. Otherwise, you could end up like U.S. Sugar, trying over and over again to get the same project permitted.

New Florida Rule to Eliminate Water Management District Fees for Some Forestry-Related Activities

In good news for Florida's timberlands owners, the Florida Forestry Association reports:

The $250 fee for receiving a permit from the state's Water Management Districts (WMDs) for certain forestry-related activities is being eliminated with the adoption by Florida DEP of a revised environmental permitting system. Forestry activities, such as fill-road construction and stream crossings, that formerly required a "Noticed General Permit" (NGP) now qualify for the new "No-Fee Noticed Exemption for Minor Silvicultural Surface Water Management Systems" (Rule Number 62-330.0511 F.A.C). This new rule goes into effect on October 1, 2013, in each of the five WMDs. It's important to note that this very positive regulatory change is the direct result of FFA's Environmental Committee meeting with DEP officials last year to discuss the way silviculture was being regulated by the WMDs.

Review the full rule and all the activities for which there will no longer be a fee here.

Quick Update: Will Congress Act to Fix the Forest Roads Quagmire through the Farm Bill?

I've had some questions lately about the effects of the U.S. Supreme Court's decision in Decker v. NEDC, 568 U.S. _ (2013). As I've discussed, in that case, the Supreme Court held that the U.S. Environmental Protection Agency’s (EPA) rules properly exempt stormwater runoff from logging roads from permitting under the Clean Water Act. Because of complications from the new rule EPA issued just before oral argument in the Decker case, however, the NEDC had an opening to continue the litigation out in the Ninth Circuit. So the litigation and uncertainty for forest landowners continued.

These questions are timely. As my readers well know, I've been saying for years on this blog that the only way out of the forest roads quagmire and its resulting litigation is for Congress to act.

This year's Farm Bill process was a mess. While the bill sailed through the Senate, in the House nobody on either side of the aisle could agree on anything. Ultimately, the House was able to split the farm components of the bill from the food stamp provisions that have been a part of it for years. Into this "farm only" bill went the Forest Roads Amendment. This amendment would preserve EPA's 37-year-old interpretation that forest roads should be regulated as nonpoint sources (and therefore no permit is necessary). This amendment was basically the same as the Silvicultural Regulatory Consistency Act, which various legislators have been working to pass for several years.

This paves the way for a true legislative solution when the Senate and the House discuss the differences in the bills that were passed later this year--presumably before September 30, when the current Farm Bill expires. If you're a forest landowners or in the forestry industry, you'd do well to call your senators and representatives and encourage their support for the Forest Roads Amendment.