1 DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF ADMINISTRATION, STATE OF FLORIDA
2
SUGAR CANE GROWERS COOPERATIVE OF FLORIDA, )
3 ROTH FARMS, INC., and WEDGWORTH FARMS, INC., )
-and- )
4 FLORIDA SUGAR CANE LEAGUE, INC., UNITED )
STATES SUGAR CORPORATION, and NEW HOPE )
5 SOUTH, INC., )
-and- )
6 FLORIDA FRUIT AND VEGETABLE ASSOCIATION, )
LEWIS POPE FARMS, W. E. SCHLECHTER & SONS, )
7 INC., and HUNDLEY FARMS, INC., )
)
8 Petitioners, )
)
9 vs. )DOAH CASE NOS.
)92-3038
10 SOUTH FLORIDA WATER MANAGEMENT DISTRICT, )92-3039
)93-3040
11 Respondent, )(Consolidated)
)
12 and )
)
13 MICCOSUKEE TRIBE OF INDIANS, THE UNITED )
STATES OF AMERICA, FLORIDA DEPARTMENT OF )
14 ENVIRONMENTAL REGULATION, and FLORIDA )
WILDLIFE ASSOCIATION, )
15 )
Intervenors. )
16 ____________________________________________ )
17 HEARING BEFORE: HONORABLE J. STEPHEN MENTON
HEARING OFFICER
18
DATE: TUESDAY, SEPTEMBER 29, 1992
19 (1:07 P.M. - 6:05 P.M.)
20 LOCATION: HEARING ROOM 5, DESOTO BUILDING
1230 APALACHEE PARKWAY
21 TALLAHASSEE, FLORIDA
22 REPORTED BY: SUE HABERSHAW JOHNSON
CERTIFIED COURT REPORTER
23 REGISTERED PROFESSIONAL REPORTER
NOTARY PUBLIC
24
25
2
1 APPEARANCES:
2 Representing Petitioners, Sugar Cane Growers
Cooperative of Florida, Roth Farms, Inc.,
3 and Wedgworth Farms, Inc.:
4 WILLIAM H. GREEN, ESQUIRE
-and-
5 ROBERT DE MEO, ESQUIRE
Hopping, Boyd, Green & Sams
6 123 South Calhoun Street
P. O. Box 6526
7 Tallahassee, Florida 32314
(904-222-7500)
8
Representing Petitioners, Florida Sugar Cane
9 League, Inc., United States Sugar Corporation,
and New Hope South, Inc.:
10
JUDITH S. KAVANAUGH, ESQUIRE
11 -and-
RICK J. BURGESS, ESQUIRE
12 Peeples, Earl & Blank, P.A.
One Biscayne Tower, Suite 3636
13 Two South Biscayne Boulevard
Miami, Florida 33131
14 (305-358-3000)
-and-
15 WILLIAM L. HYDE, ESQUIRE
Peeples, Earl & Blank, P.A.
16 Suite 350
215 South Monroe Street
17 Tallahassee, Florida 32301
(904-681-1900)
18
Representing Petitioners, Florida Fruit and
19 Vegetable Association, Lewis Pope Farms,
W. E. Schlechter & Sons, Inc., and
20 Hundley Farms, Inc.:
21 KENNETH F. HOFFMAN, ESQUIRE
Oertel, Hoffman, Fernandez & Cole, P.A. 2 Suite C
22 2700 Blair Stone Road
Tallahassee, Florida 32301
23 (904-877-0099)
24
25
3
1 Representing Respondent, South Florida Water
Management District:
2
PAUL L. NETTLETON, ESQUIRE
3 Popham, Haik, Schnobrich & Kafman, Ltd.
400 International Place
4 100 Southeast Second Street
Miami, Florida 33131
5 (305-539-7222)
6 Representing the Intervenor, the United States
of America:
7
SUZAN HILL PONZOLI, ESQUIRE
8 -and-
THOMAS A. WATTS-FITZGERALD
9 Assistant United States Attorneys
Southern District of Florida
10 Suite 627
155 South Miami Avenue
11 Miami, Florida 33130-1693
(305-536-4425)
12 Representing Intervenor, Florida Department of
13 Environmental Regulation:
14 LEE M. KILLINGER, ESQUIRE
Assistant General Counsel
15 Department of Environmental Regulation
Twin Towers Office Building
16 2600 Blair Stone Road
Tallahassee, Florida 32399-2400
17 (904-488-9730)
18 Representing Intervenor, Florida Wildlife
Federation:
19
STEVEN GRIGAS, ESQUIRE
20 111 South Martin Luther King, Jr., Blvd.
P. O. Box 1329
21 Tallahassee, Florida 32302
904-681-0031)
22
23
24
25
4
1 Representing United States Department of Justice:
2 KEITH E. SAXE, ESQUIRE
United States Department of Justice
3 Environmental & Natural Resources Division
General Litigation Section
4 Room 879, 601 Pennsylvania Avenue (20004)
P. O. Box 663
5 Washington, DC 20044
(202-272-4016)
6
* * * * *
7
ALSO PRESENT:
8 JOHN DAVIS
9 RONALD THOMAS LUKE
10 * * * * *
11 INDEX
12 ITEM PAGE
13 HEARING COMMENCED . . . . . . . . . . . . . . . . . . 5
14 WITNESS: RONALD THOMAS LUKE
15 Direct Examination by Mr. Green. . . . . . . . . 75
Cross Examination by Mr. Saxe. . . . . . . . . . 87
16 Cross Examination, con't, by Mr. Nettleton . . . 98
17 HEARING CONCLUDED . . . . . . . . . . . . . . . . . . 204
18 CERTIFICATE OF REPORTER . . . . . . . . . . . . . . . 205
19 * * * * *
20
21
22
23
24
25
5
1 PROCEEDINGS
2 (WHEREUPON, THE HEARING COMMENCED AT 1:07 P.M.)
3 HEARING OFFICER: All right, why don't we start
4 out by giving the roll call of who's here this
5 morning. Petitioner Cooperative?
6 MR. GREEN: Bill Green, Your Honor.
7 HEARING OFFICER: For the League?
8 MS. KAVANAUGH: Judith Kavanaugh, Rick Burgess,
9 and Bill Hyde.
10 HEARING OFFICER: Okay. For the Fruit and
11 Vegetables?
12 MR. HOFFMAN: Ken Hoffman.
13 HEARING OFFICER: All right, and for the South
14 Florida Water Management District?
15 MR. NETTLETON: Paul Nettleton.
16 HEARING OFFICER: And U. S. Government?
17 MS. PONZOLI: Suzan Ponzoli, Keith Saxe, and
18 Tom Watts-Fitzgerald.
19 HEARING OFFICER: All right, and for any of the
20 other intervenors?
21 MR. GRIGAS: Steve Grigas, Florida Wildlife
22 Federation.
23 HEARING OFFICER: Okay.
24 MR. KILLINGER: Lee Killinger, DER
25 HEARING OFFICER: Okay. Anybody else? All right.
6
1 Let's start out with a couple of housekeeping
2 matters.
3 There is a pending motion to intervene, which a
4 response has been filed by the League, I believe.
5 Are there any other issues that need to be raised in
6 connection with the petition for leave to intervene?
7 My inclination is to, I will enter an order
8 granting the petition to intervene along the same lines
9 the other ones have been filed. At this point
10 I think it's still, I haven't found it to be
11 unmanageable at this point, so we'll proceed under
12 the current procedure.
13 Second, my Clerk's Office has asked me to once
14 again mention that when you file something with us
15 please file the original and one copy, because the
16 original goes to the court file to keep that up to date,
17 and the copy goes to me, and if you don't file the
18 original there's often a delay in my getting
19 it, so it will inhibit the process here.
20 So if you can please be sure to file the
21 original and one of any pleadings you file with the
22 Division.
23 As another housekeeping matter, I noticed in
24 several of the motions and responses that have been
25 filed there has been a great deal of citation to
7
1 federal authority. Just for your own information,
2 let me just advise you that we have limited federal
3 research materials available here at the Division.
4 We do have the Supreme Court Reporter, although
5 we tend to get the most recent copies on a fairly
6 delayed basis, so I think we're on up to '91 now.
7 I do not have any of the other Federal Reporters
8 or the rules decisions. Obviously there is access to
9 the law school, but I don't always have an
10 opportunity to go down, and the other thing is a
11 lot of things I'm reading on the road, so if you
12 are going to cite the federal cases it's probably
13 best if you would give me a copy, and hopefully that
14 will limit your citations.
15 I guess the other matter I wanted to bring up
16 at the outset is we had discussed as a result of the
17 August 21st hearing entry of an order summarizing
18 some of the rulings that were made there. I did
19 receive this afternoon a copy of the transcript
20 from that hearing that Mr. Hyde provided me with.
21 I have not obviously had an opportunity to go
22 back through it. I don't know where we stand on that
23 and whether there are any modifications that need to
24 be made.
25 MS. KAVANAUGH: If I may, Mr. Hearing Officer,
8
1 and we apologize, we thought a transcript had been
2 provided to you, and Bill pointed out to me we
were
3 to provide it to you this morning, so I wanted to
4 make sure you had it, there has been a proposed order
5 exchanged. It is strongly disputed. There is very
6 little agreement.
7 Our suggestion would be to submit proposed
8 orders and let you read the transcript and decide.
9 At least that's from my clients.
10 HEARING OFFICER: All right. Ms. Ponzoli?
11 MS. PONZOLI: I would agree it seems to be in
12 dispute. We had a meeting this morning where we
13 did try to go through it, and it did seem that there
14 was a lack of agreement.
15 I think you will find as you go through the
16 transcript it's not an easy thing to discern what
17 the agreements were there, so I sympathize with
18 your task.
19 There was agreement, however, on two of the
20 paragraphs of the federally proposed order, and that
21 was paragraph seven, which is of not very much
22 importance, which said that any dispute over site
23 selection or sampling activities would come back to
24 you.
25 The other one I think from our perspective is
9
1 important, however, and that is on number 10.
2 The United States is entitled to conduct discovery
3 on all issues raised by petitioners' pleadings, subject
4 to the usual restrictions to which any party
5 participating in these hearings might be held, and it
6 was agreeable with the addition by the Cooperative's
7 attorney we add something along this line, "However,
8 this order does not determine the scope of
9 the issues of petitioners' pleadings."
10 HEARING OFFICER: I'm not sure that all
11 registered as you read it. Summarize exactly what
12 you're saying.
13 MS. PONZOLI: Well, that we may litigate
14 whatever they have raised in their pleadings. They
15 are conceding that now, or at least are accepting
16 your ruling.
17 I believe you ruled that. I can cite you to
18 the page where you said, "Yes, what they raise you
19 can litigate."
20 They want it clear that what I think they have
21 raised and what they think they have raised might
22 be in dispute. Is that a fair...
23 MR. GRIGAS: That's fair.
24 MS. KAVANAUGH: Right. We agree that anything
25 we raise is at issue. I don't think we have a
10
1 disagreement on that point.
2 HEARING OFFICER: Okay. Well, why don't we do
3 this. Each of the parties obviously has your own
4 version as to what the result of the August 21st
5 hearing was. Submit your proposals to me, and I'll
6 go back and review the transcript, and I'll do an
7 order, and we'll get it moving along.
8 MS. PONZOLI: If I may, Mr. Menton...
9 HEARING OFFICER: Right.
10 MS. PONZOLI: ...there was another agreement
11 this morning that might, I guess I haven't proposed
12 it to the other side, there is a lot of dispute still
13 over a number of issues in regards to the entry into
14 the Refuge in particular, and what was agreed to at
15 the hearing and what was not agreed to, and what we
16 propose to do rather than separating our perspectives
17 was to put Mr. Fitzgerald and Mr. Burgess together,
18 and they would try and draft a single entry order
19 reflecting the entry into the Refuge and the Park,
20 and then they would just lay out if there were discreet
21 areas that are not part of today's hearing.
22 Today's hearing has I think like two or three
23 defined areas on which you are expected to rule
24 regarding that entry, but as to all these other
25 things going back and forth if they could either
11
1 reach closure or at least offer Paragraph A and
2 Paragraph B, that might be a modification to the
3 proposed order that Ms. Kavanaugh was referring to,
4 and then we would only reflect other issues in our
5 proposed orders.
6 Do you understand the distinction I'm making?
7 HEARING OFFICER: Well, I don't have, you know,
8 your draft, so I'm not sure how it all fits into
9 play.
10 Do you, are you saying you want to give them
11 an opportunity to meet and come up with a separate
12 order addressing the access to the Park and the Refuge
13 and then delete those portions from that proposal
14 you have and a separate proposal regarding the other
15 issues, and then I'll deal with that?
16 MS. PONZOLI: Yes, sir. Most of that hearing on
17 the 21st is to the access to the Park. The greater
18 majority of it goes to that issue.
19 HEARING OFFICER: Right. So you are suggesting
20 that there will be another meeting after this hearing
21 between Mr. Fitzgerald and Mr. Burgess with an
22 attempt to narrow those issues a little bit further?
23 Is that what you're saying?
24 MS. PONZOLI: Right, and I think there was
25 agreement that when the entry into the Park and the
12
1 Refuge occurs that there needs to be a single
2 document reflecting the terms and conditions as
3 ordered by you and/or agreed to by the parties or
4 whatever, a single document that reflects what's
5 going to go on, so we don't have to go back and
6 reconstruct transcripts and orders and hearings.
7 MS. KAVANAUGH: We're thinking obviously today
8 some of the issues will be addressed and ultimately
9 we hope to have rulings on virtually everything,
10 and perhaps since there is a stipulated single
11 document that everybody can carry around with them
12 when they're out in the field, so we don't get into
13 arguments.
14 We are in agreement with the process, but
15 obviously today's rulings may dictate further
16 refinements of the soil core replication issue and
17 things the scientists can work out. We'd like to
18 stipulate that and have that in one document.
19 HEARING OFFICER: Okay. What are we talking
20 about in time frame in terms of addressing first of
21 all the entry and access issues after a meeting
22 between Mr. Burgess and Mr. Fitzgerald and then the
23 other aspects?
24 MS. PONZOLI: They have requested an
25 overflight over the Refuge, and they have requested
13
1 that that occur prior to this meeting so it could
2 help refine the issues that seem to keep floating
3 back and forth, and we have agreed, "Fine, you can
4 have your overflight on the 6th of October, we'll send
5 an observer with you, and then Mr. Burgess,
6 Mr. Fitzgerald, and a representative scientist from each
7 side will sit down in a single meeting," and
8 maybe with a little luck it will produce a document
9 with no issues left to be resolved or very discreet
10 ones.
11 HEARING OFFICER: Okay. So what are we talking
12 about in a time frame here?
13 MS. KAVANAUGH: Well, we would hope we can
14 begin with the overflight. There is a dispute over
15 whether that should be included in the first week of
16 actual testing. We still are hopeful that can be
17 worked out.
18 So I don't think, the next week after October 6th
19 would be when we could schedule a meeting, certainly.
20 Let's, while it's fresh on everyone's minds, fly over
21 and, what, a week after that to propose an order?
22 MR. WATTS-FITZGERALD: I would suspect we
23 would be able to resolve 80 per cent of the issues
24 based on what happens that day, and after that we
25 should be able to crank out a document within two or
14
1 three days tops.
2 MS. KAVANAUGH: October 15th we would propose
3 the date to submit a stipulated order to tell the
4 Hearing Officer we're not going to agree and have
5 a phone conference?
6 MR. WATTS-FITZGERALD: That's reasonable.
7 HEARING OFFICER: Why not do that?
8 MR. WATTS-FITZGERALD: The one issue that sort
9 of precedes that and precedes as well the entry on
10 the 6th for the overflight is one that we had thought
11 was resolved last month, which as a result of the
12 meeting we had this morning apparently is not
13 resolved.
14 One of the attorneys this morning with some
15 justification pointed out all meetings tend to raise
16 more issues than resolve issues, but you will recall,
17 Mr. Menton, we discussed last month the issue of
18 special use permits and the regime under which entry
19 would occur for the federal enclave, and I pointed
20 out the optimal way to handle that was to sidestep
21 the issue entirely.
22 While we are not requiring a formal application
23 for such a document we would cause the respective
24 Resource Managers to issue a special use permit for
25 the activities that were embodied by the agreement
15
1 and the orders.
2 It's clear from the meeting a month ago and
3 the exchange amongst counsel that we are agreeing to
4 an aerial overflight of one day's duration in
5 Loxahatchee for purposes of hopefully relocating
6 historic sites and site selection purposes by the
7 League and its aligned interests.
8 We will issue a special use permit for that.
9 There is a continuing objection, as you know, by the
10 opposing parties to anything that doesn't smack of
11 pure discovery pursuant to the authority of
12 Chapter 22 and the Florida Rules.
13 My understanding of your statements in the
14 transcript, which I read over and over, was that you,
15 too, would like to avoid any unnecessary
16 jurisdictional issues that would really only obstruct
17 focus on the issues in this case.
18 If I'm incorrect in that, we may need to assess
19 that before the 6th. Otherwise there's no issue of
20 holding back the overflight on the 6th.
21 HEARING OFFICER: Okay, I guess I'm not clear
22 as to exactly what the dispute is here. I thought
23 there was a basic understanding that the overflight
24 would take place, and that, I'm not sure that we
25 even got into the specifics. I'd have to go back
16
1 over the transcript, which I obviously haven't done,
2 as to whether or not a special use permit had to be
3 issued or not. Was that discussed?
4 MR. WATTS-FITZGERALD: It probably was not in
5 so many words, but as appears in our pleadings on
6 the subject in response to the initial request for
7 entry in the response it spoke in terms of the
8 2,000-foot limitation and the special regime
9 applicable, Congressionally mandated for that area,
10 and so we will issue one.
11 HEARING OFFICER: I do recall the U. S.
12 Government made the statement that it would take
13 whatever steps were necessary to get the permits
14 issued so that it could take place.
15 MR. WATTS-FITZGERALD: That's right.
16 HEARING OFFICER: I'm not sure why that's an
17 issue that needs to be resolved.
18 If a permit is necessary to conduct the flight
19 and it's going to be issued, then why is that a
20 problem?
21 MS. KAVANAUGH: The only issue, if they wish to
22 issue a permit we have no objection. It's their
23 regulatory action.
24 However, we do not intend to apply for a
25 permit, and we feel this is discovery, and
17
1 apparently they don't expect us to.
2 HEARING OFFICER: I guess the problem is there
3 are certain conditions that have to be followed in
4 terms of the overflight, and they just want to make
5 sure they are incorporated.
6 MS. KAVANAUGH: So far as complying with the
7 FAA regulations, the air space, and all that I think
8 there is agreement. I think it's form over
9 substance here, and our big concern, as I expressed
10 at the last hearing, is to ensure that any disputes
11 which may arise, and it has been a very contentious
12 situation, will be resolved in the framework of
13 these proceedings and discovery.
14 It is hoped that that won't occur, but our
15 concern of the whole special use permit is there is
16 an identified administrative procedure wherein
17 the federal agencies can either enforce, revoke, or
18 modify the special permits, and we just want to
19 make sure that they are not in essence maintaining
20 a veto power over whatever comes out as discovery in
21 the case. That was why we felt discovery issues
22 were discreet and not subject to the special
23 permitting, and we still feel that way.
24 However, I don't think there's any dispute
25 about compliance with the air space regulations and
18
1 notification, and we fully anticipate their
2 observers to be with us, and I think it just boils
3 down to what their position is with regard to any
4 disputes.
5 HEARING OFFICER: Okay. I thought that there
6 was a consensus at the last hearing that these very
7 difficult issues of federal jurisdiction,
8 administrative jurisdiction, and the interplay
9 between them could hopefully be avoided, and that
10 there were certain requests made for access that the
11 federal government was going to make sure that
12 whatever the Department of Interior permits were
13 necessary would be issued, so that would be carried
14 out, and that the discovery could be carried out
15 within the guidelines required by the Department of
16 Interior, and hopefully we're not going to have a
17 problem.
18 MS. KAVANAUGH: It may not be ripe, Mr. Hearing
19 Officer, at this point. I guess what I'm saying is our
20 position is we will not be formally applying.
21 HEARING OFFICER: You're not going to waive
22 the argument that...
23 MS. KAVANAUGH: Yes, sir.
24 HEARING OFFICER: ...that at the first hearing
25 I have the authority to issue an order requiring
19
1 the federal government to grant access under whatever
2 conditions, irrespective of the Department of Interior,
3 but hopefully we won't have to get to that point,
4 because the discovery will take place within those
5 guidelines.
6 MS. KAVANAUGH: Yes, and I would represent to
7 you, Mr. Hearing Officer, we do not intend to formally
8 apply, but if they indicated they will issue the
9 permits it doesn't matter. I mean, they have
10 already represented they will expedite it.
11 One other point on the overflight, Mr. Hearing
12 Officer, this morning we had a discussion. One of the
13 things, the purpose of the overflight is to identify
14 the sites, the sampling sites, used in developing
15 the SWIM plan, and there may be some problem locating
16 the sites, although we are hopeful there won't be,
17 and it may be more than one day.
18 I just want to make sure we all understand
19 they are going to try to help us find the sites, and
20 since they are sites they have been sampling from
21 we assume they will, but there is a question if
22 they cannot locate them right away.
23 So it might take two overflights, but hopefully
24 that will not be the case.
25 MR. WATTS-FITZGERALD: As I mentioned, we will
20
1 seek to assist their field personnel in locating
2 the sites. However, marshes by and large are pretty
3 fungible, and if for any reason the historical sites
4 cannot be precisely located we are not undertaking
5 to locate it at all costs, and I don't understand
6 any reference to those being the sites necessarily
7 at which compliance will be determined, because
8 that is incorrect.
9 MS. KAVANAUGH: Only the 14 sites, Mr. Hearing
10 Officer, that are set out in the hearing and the SWIM
11 document as sampling sites that will be used for
12 determination of the phosphorus limits. We're not
13 talking about all 18 sites.
14 MR. WATTS-FITZGERALD: Or the six.
15 MS. KAVANAUGH: We're speaking only of the 14
16 discreet...
17 MR. WATTS-FITZGERALD: Okay, so long as we are
18 agreed.
19 MS. KAVANAUGH: ...compliance sampling sites.
20 HEARING OFFICER: Okay. Well, I guess her
21 point is she's saying they may not be able to do it
22 in a day.
23 MS. KAVANAUGH: Right.
24 HEARING OFFICER: I thought that's what we
25 started out with, and I guess I don't know if that's
21
1 going to cause a problem or not, but I assume you will
2 work with them?
3 MR. WATTS-FITZGERALD: If we can't find them in
4 a day we're not going to find them, unless there's
5 some problem with the aircraft or the electronic
6 navigation equipment.
7 MS. PONZOLI: We'll work through it. This is
8 not the biggie here today, whether it will take one
9 or two days. We really need to move on.
10 If it takes two days we may have to schedule a
11 second day. It's not that big a problem.
12 HEARING OFFICER: Okay. Well, just to finish
13 this aspect though, October 15th is the day that we
14 can set down for submitting proposals or stipulations
15 regarding the access and entry issues, and now that
16 I have a copy of the transcript of the last hearing
17 I'll take those and enter an order based upon my
18 review of the transcript and my understanding of the
19 agreements that were reached.
20 Now that deals with just one portion of the
21 order that you were working on that you apparently
22 discussed this morning, is that right?
23 MS. PONZOLI: Yes.
24 HEARING OFFICER: Now what do we want to do
25 about the second portion of that? What issues are
22
1 we talking about, other than the access and entry,
2 that are important in your proposal?
3 MS. PONZOLI: In my proposed order it really
4 dealt largely, there were eight paragraphs with
5 regard to entry into the Park and the Refuge, and
6 then there was one that basically said, "We're going
7 to brief and reconvene on our entry into the EAA."
8 I guess we agreed to that one, but it doesn't
9 say anything other than we would come here today and
10 have whatever oral argument you wanted to hear on
11 our entry into the EAA, and then the other discovery
12 rulings were that we could litigate those issues
13 raised by their pleadings.
14 Then the final one is in dispute, what the
15 understanding was on the phone following the
16 two-week expansion. The final one was the effect
17 of the two-week expansion of discovery.
18 The two letters, you didn't receive a copy of
19 the proposed order? I thought it was...
20 HEARING OFFICER: Well, there were a number of
21 documents in my mailbox this morning that I got,
22 and I don't know if that was in there or not.
23 MR. WATTS-FITZGERALD: Mr. Hearing Officer,
24 it was delivered yesterday. Perhaps we could supply
25 you a copy.
23
1 HEARING OFFICER: The facsimile thing?
2 MR. WATTS-FITZGERALD: Yes, it appears to be it.
3 HEARING OFFICER: Okay, this was in my mailbox
4 that I just picked up three minutes before I walked
5 in here, so I have not had an opportunity to review
6 it.
7 MS. PONZOLI: Okay. Is it the United States
8 pleadings, Mr. Hearing Officer, that you are having
9 problems with that don't seem to have an additional
10 copy?
11 HEARING OFFICER: To be honest with you, I'll
12 have to ask my Clerk's Office. I don't know. They
13 just came to me and asked me to make that request
14 again.
15 MS. PONZOLI: We think we're submitting one with
16 a copy and then one for the people who file it for
17 us, but if it is our pleadings I guess I would
18 appreciate knowing, because I don't know that I have
19 anything to remedy, and I haven't remedied. You
20 keep looking in this direction, and I think it must
21 be our pleadings.
22 HEARING OFFICER: I'm just generically making
23 the comment.
24 MR. WATTS-FITZGERALD: If you could glare at the
25 other side for a few moments...
24
1 HEARING OFFICER: My Clerk's Office just
2 mentioned it. I think it is being done now, but
3 there was one of the discovery motions that were filed
4 recently, one of the large ones, that...
5 MR. SAXE: It may very well have been the
6 last Tuesday's filed U. S. opposition in
7 cross-opposition on the Coop's motion for protective
8 order. It's quite possible that went out without
9 two copies, and I will take steps to remedy that in
10 the future if it did.
11 HEARING OFFICER: Okay, and the other thing is
12 that our Clerk's Office, you know, a lot of times if
13 you file something, like you filed this yesterday,
14 what they have to do is they have to docket it, and
15 if there's an extra copy a lot of times they will
16 immediately file it in my box.
17 Most of the time they will wait until they
18 docket it as they go through, because they come in
19 together, and if it doesn't get docketed, you know,
20 this was filed yesterday at 4:40, which meant it
21 got docketed this morning, which meant it didn't
22 get into my box until 11:30 this morning, so I
23 won't have an opportunity to review it, and again
24 sometimes I've got to pick up my mail.
25 MS. PONZOLI: All right. But the issues as I
25
1 understand it on the final paragraph, number 11,
2 in that proposed order is whether we simply pushed
3 everything forward during the two weeks of the
4 expansion or if we in fact push all discovery forward
5 two weeks, and it appears that the respondents
6 thought we were just pushing forward those two weeks
7 with isolated instances of like the brief on burden
8 of proof, and that is reflected in the letters that
9 are attached, my letter summarizing all discovery
10 at that time that was due, and then the League
11 saying, "Well, we agree with your letter except for
12 these three dates," and I'm not disputing your
13 changes. Whether they're right or wrong, in th
14 wake of the hurricane it's not worth fighting over
15 that there. We just accept all those dates.
16 I think the respondents understood we were
17 pushing the time frame forward only as to those
18 issues. I believe the petitioners believe that all
19 discovery was pushed forward two weeks. They will
20 have to speak for themselves.
21 I think it is up to you to decide how to
22 resolve this.
23 MS. KAVANAUGH: I typed the motion and Faxed it
24 to you from my home, and if it was ambiguous it
25 was our understanding and belief that everything was
26
1 going to be moved forward, and it could have been
2 definitely clearer.
3 The reason that we believed this was because
4 as I think we represented in other hearings for our
5 experts to formulate their opinions we have to get a
6 certain amount of discovery as to the basis for
7 the plan, document production, and depositions of
8 District personnel.
9 All of it got moved, so we assumed everything
10 was moved forward by two weeks, and we would
11 certainly like to see that, because we have had a
12 suspension in discovery, based, for example, on
13 the document production scheduled I think for
14 August 25th or 26th which is occurring, just occurred
15 last week or is occurring now, but, you know,
16 what can I say?
17 That's what we thought. If it isn't correct
18 or if it isn't what anyone else thought, then we
19 are asking that today, moving for that two weeks,
20 bumping everything by two weeks.
21 HEARING OFFICER: Now are you talking about
22 everything that's in the scheduling order?
23 MS. KAVANAUGH: Yes, not the hearing date, but
24 just the discovery scheduling order
25 HEARING OFFICER: So that the disclosure date
27
1 for the final disclosure I think was October 26th?
2 MS. KAVANAUGH: Would be like November 9th,
3 I think, was what we had been thinking, "Oh, now
4 it's November 9th."
5 HEARING OFFICER: So you want to move all those
6 dates back two weeks?
7 MS. KAVANAUGH: They don't.
8 MS. PONZOLI: We don't. You know...
9 MR. NETTLETON: Mr. Hearing Officer, Paul
10 Nettleton on behalf of the District, I think the only
11 thing we're talking about is the second disclosure,
12 if I'm not mistaken. I don't know of anything
13 else that's involved.
14 My, our position simply first is that we didn't
15 rely on anything they said in their motion. It's
16 my understanding just from discussions with counsel
17 and including the last hearing on the telephone
18 that the only issues that were involved in the
19 two-week extension were pending discovery during
20 that two-week hiatus, and that it didn't affect any
21 other matters in the scheduling order.
22 Specifically no one has ever mentioned pushing
23 off the date of the second disclosure until this
24 morning at our meeting, and that was the first time
25 I heard that was being proposed.
28
1 So it certainly wasn't within the contemplation
2 of the parties when we agreed to the two-week
3 extension, and frankly I don't see why we need to
4 extend the experts' two weeks, because unless the
5 experts themselves have personally been affected by
6 the hurricane, which I don't think is the case in
7 most situations, they are still going to be able to
8 identify who they are and their areas of testimony
9 even if they haven't gained entrance yet, because
10 obviously even if they got entrance back when we
11 started this process they would still be doing the
12 testing, so I don't see what that has to do with the
13 revelations that the second disclosure, because
14 they're planning to continue testing past
15 October 26th anyway.
16 MS. KAVANAUGH: Could I make a suggestion?
17 You know, and you're probably just going to grant the
18 motion, but I was going to suggest we will try to
19 live with the October 26th deadline, and if we have
20 specific situations where it's a problem with
21 specific experts then we will ask for relief as
22 to those if the two weeks is really bothering
23 them.
24 HEARING OFFICER: Okay. Why don't we try to
25 do that? I think to the extent that we can stay with
29
1 the order as it was entered before let's try to
2 do it.
3 Now I think the hurricane obviously caused a
4 lot of confusion and difficulty for everyone, and
5 I believe I spoke with Ms. Kavanaugh, Mr. Hyde,
6 Ms. Ponzoli, and several other people who called
7 me regarding that situation, and my response was
8 consistently, "Well, be sympathetic and try to
9 understand that everybody is in a difficult deal,
10 and we'll get back on schedule as best we can."
11 Let's try to get back on schedule. If there
12 are specific problems in doing so, then let's
13 address those in specifics rather than moving
14 anything back.
15 MR. NETTLETON: Then I would say, Mr. Hearing
16 Officer, if there are specific problems then I would
17 hope we can agree to extend relating to the
18 specific problems, and it won't necessarily have to
19 be brought up by a motion or something. I don't
20 think there's a need to amend the scheduling order
21 now.
22 HEARING OFFICER: Yes, I think we should try
23 to stay with the scheduling order, and if there are
24 specific situations try and work it out. I think
25 everybody knows the difficulties that have been
30
1 caused by the hurricane and are sympathetic to it.
2 We'll try to do that.
3 Ms. Ponzoli, what is the bottom line with
4 respect to the other issues that are in the proposal
5 regarding the August 21st hearing? Is there, I
6 guess we have talked about some of these things here,
7 but, you know, are there separate paragraphs that
8 are still in dispute that need to be resolved?
9 What's the time frame for submitting a proposal on
10 that?
11 MS. PONZOLI: Well, since we are going to have
12 rulings either today or if you take time to think
13 about them over the presentation today, I think it's
14 the split samples, the sites, and I guess the special
15 use we have just resolved a few minutes ago, so
16 there may only be two issues left, the first eight
17 paragraphs deal with the Refuge and the Park.
18 What is submitted to you by Mr. Fitzgerald and
19 Mr. Burgess should cover those. There is no need
20 for each of us to address those individually.
21 As to our entry in the EAA I think we're in the
22 same situation. You will issue a ruling today,
23 or you will give guidance as to where we're going,
24 so that...
25 HEARING OFFICER: So that issue from August 21st
31
1 was really carried over to today anyway?
2 MS. PONZOLI: Well, that's right, and then as
3 to our ability to litigate the issues raised by
4 their pleadings I think I would ask you to
5 incorporate that in some order, and I think the
6 record we have today will reflect the paragraph, it
7 was paragraph number 10 with Mr. Green's additional
8 sentence.
9 HEARING OFFICER: Okay, now I'm not sure what
10 you mean by litigate the issues in their petition.
11 I think that the petition frames the issues that
12 are in dispute in this case, and the U. S. Government
13 and all the intervenors are here in support of the
14 SWIM plan as it was drafted, which means that
15 they're entitled to defend the SWIM plan against
16 all challenges as framed by the petitioners.
17 MS. PONZOLI: Yes, sir. I have no problem with
18 that, and I think they may have no problem with that
19 at this point, but the argument was made on the 21st
20 that the United States was in as a limited
21 intervenor and could only defend the SWIM plan, not
22 oppose the petitions. That explicit argument was
23 made.
24 And we said, "No, we can oppose the petitions
25 in support of the SWIM plan."
32
1 MS. KAVANAUGH: I don't think we took that
2 position, Mr. Hearing Officer. What you said is
3 basically what our position was. If that was the
4 way it came across...
5 HEARING OFFICER: I remember the discussion, but my
6 position I think on August 21st and certainly
7 what I meant to convey is that I believe that the
8 petitions frame the issues that are involved in
9 this case, and I don't think that the United States
10 or the intent of my order limiting their participation
11 was simply to mean they can't come in here and
12 present new evidence or any evidence regarding issues
13 that should have been in the SWIM plan but aren't,
14 and that's what I intended to preclude from happening.
15 But to the extent that any of the petitioners are
16 raising issues which challenge the assumptions inherent
17 in the SWIM plan or how it's being implemented, then
18 certainly the U. S. Government is entitled to offer
19 evidence in rebuttal to those contentions.
20 MS. KAVANAUGH: Certainly.
21 HEARING OFFICER: The petitioners frame the
22 issues, and the U. S. Government is free to respond
23 to those issues as they deem appropriate.
24 Okay? So, and I'm not sure that that needs to
25 be in the order specifically. I mean, I think that's
33
1 common sense in terms of what's at issue.
2 MS. PONZOLI: I'm fine. And then the final one
3 is simply the effect of the two-week extension, which
4 we just covered.
5 MS. KAVANAUGH: I think we have covered that.
6 HEARING OFFICER: So the scheduling order will
7 stay as is. If there is any need to make adjustments
8 to that, they will try to do it, and if not file
9 specific motions.
10 MS. KAVANAUGH: We withdraw our request for
11 the two-week extension.
12 HEARING OFFICER: Okay, so that essentially
13 all this paragraph says, aside from the paragraphs
14 on the Refuge and the Park, we don't really need to
15 get into any of that. There's no need for another
16 order.
17 MS. PONZOLI: Right.
18 HEARING OFFICER: We'll just take care of
19 that with the October 15th submittals, and after the
20 meeting between Mr. Burgess and Mr. Fitzgerald
21 we'll try to get an order together that delineates
22 specifically the I guess access and entry issues in
23 terms of the Park and the Refuge.
24 That was the easy one, right? Before we get
25 into the more difficult ones, I did note that the
34
1 motion for protective order regarding the production
2 of documents with respect to Dr. Parks' deposition,
3 and there was something in my mail this morning that
4 there was a withdrawal of that motion, is that right?
5 I didn't get a chance to read that, and I don't know.
6 That's not it?
7 MS. PONZOLI: They withdrew it for us.
8 MS. KAVANAUGH: The deposition is over.
9 MS. PONZOLI: The deposition took place,
10 Mr. Hearing Officer, and I think in the sense the
11 deposition took place and we worked our way through
12 it, then in that sense it is moot.
13 I think some of the issues that were raised
14 there are still very much alive and well, and that
15 we will be returning to you for rulings on certain
16 things that occurred prior to that deposition and the
17 issues that were raised via a vis expert witnesses,
18 fact witnesses, documentations, and the type
19 documents, but I don't think you need to rule on
20 that today, and I don't think anybody here today
21 wants to get into it.
22 MS. KAVANAUGH: We don't need to respond.
23 MS. PONZOLI: No. No. Let's let that until it
24 happens again, because we're heading for it, it's very
25 clear.
35
1 HEARING OFFICER: Okay, so basically you're
2 agreeing then your motion for protective order is
3 moot at this point, and if there's something that
4 needs to be brought up with respect to the issues
5 raised you will do it by separate motion?
6 MS. PONZOLI: Yes, sir. Yes, sir.
7 HEARING OFFICER: Okay. All right. I guess
8 next is the United States request for production of
9 documents.
10 There were objections filed by the Coop and
11 the League as well regarding financial aspects of
12 those requests for production and also as to other
13 Issues that were sought in the request for production.
14 As I understand from reading the motion for
15 protective order that was filed and the motion to
16 compel, response to motion to compel, those issues
17 today, we'll deal with the financial issues, and the
18 other issues will be, have they been resolved, or where
19 are we on the other objections?
20 Before we get into the financial, I'm just
21 trying to understand will we have to deal with the
22 other objections at a future date, or have they been
23 worked out, or what...
24 MS. KAVANAUGH: I think one we resolved this
25 morning as to the experts.
36
1 MR. SAXE: The expert documents.
2 MS. KAVANAUGH: That was Request 2, 3, and 4,
3 1, 2, 3, and 4.
4 MS. PONZOLI: I believe the United States
5 represented at our meeting this morning we wished
6 to see the outcome of today's hearing. I'm not sure
7 we have a total agreement on that production of
8 expert witness documents. That's a separate reading
9 of the discovery schedule, Mr. Hearing Officer.
10 We read it any request for expert witness
11 documents can be done at any time and can be filled
12 at any time, those documents that exist. They
13 read it only prior to deposition.
14 We tried to reach some agreement, but I don't
15 think we reached closure as to what expert witness
16 documents, what we can agree, when they will be
17 produced.
18 MR. GREEN: We would concur with Ms. Ponzoli
19 that those issues should be relegated to a later
20 deliberation in light of the importance of the
21 other issues before us today. That's why we asked
22 for the procedure.
23 HEARING OFFICER: So we will just at this point,
24 the other objections that do not relate to the
25 financial matters that were raised by the
37
1 petitioners to the U. S. request for production,
2 we'll just have to defer those, and the parties will
3 address those items by motion to compel or by a
4 subsequent motion at a future date, is that right?
5 MR. HOFFMAN: For the record, the Fruit and
6 Vegetable Association and the other parties in
7 Case No. 92-3040 also filed objections to the request
8 for production of documents, and we didn't have the
9 same controversy with respect to witnesses, because
10 we were relying more on the other people for witnesses
11 and also the subpoenaing of state and federal
12 witnesses.
13 We did object to the requests for such things
14 as payroll records and that kind of thing.
15 As I understand the law, there were no motions
16 filed concerning our objections, but by research
17 indicates that once we filed objections that
18 establishes the issue, and there need be no further
19 motions.
20 So our objections are at issue in the case.
21 HEARING OFFICER: Okay. I thought that during
22 the telephone hearing that we did last week that what
23 we had agreed to do, I understand that each of the
24 petitioners has filed objections to the request for
25 production, and those objections go, and I'm
38
1 categorizing them both as financial and other,
2 because the financial we will deal with today, and to
3 the extent that there are objections to the request to
4 produce dealing with other issues, we'll postpone
5 those, but after the hearing last week or what I
6 intended to make clear was we would deal with all of
7 the objections that any of the petitioners had, would
8 be considered within the scope of the motion to
9 compel that the U. S. had filed.
10 So to the extent that your objections go to
11 financial grounds, we're going to deal with those.
12 If it goes to other grounds we'll defer them along
13 with everything else.
14 So all petitioners will be in the same boat in
15 terms of these discover issues, and even if the
16 objections might be worded differently there was a
17 lot of overlap at least as I read them in going
18 through, and there seemed to be a great deal of
19 consensus in the nature of the objections.
20 So the financial issues let's deal with today.
21 The other issues for all petitioners we will put
22 off. Okay?
23 All right. Before we get to the crux, which I
24 guess the two main issues we have to deal with are
25 the financial information and then the U. S. entry
39
1 onto the petitioners' land, and those were the two
2 main reasons we are here today, now or later.
3 The other issue that I recall being outstanding,
4 and it may be within the scope of what Mr. Fitzgerald
5 and Mr. Burgess will do, has to deal with the
6 sampling and the test site. Will that be addressed
7 in the proposal of October 15th?
8 MS. KAVANAUGH: We have experts pursuant to the
9 last hearing to testify about the specific document
10 issues that remained, as to the number of samplings,
11 the number of sites, so we are prepared to go forward.
12 HEARING OFFICER: So that's the petitioners
13 ready to go forward today. What's the U. S. position?
14 MR. WATTS-FITZGERALD: We're prepared to go
15 forward, Mr. Hearing Officer.
16 As you may recall a month ago the United States
17 agreed, this is with respect to Loxahatchee, agreed
18 to 18 sites to be visited one time only. There are
19 two additional sets of sites.
20 The 14 sites on historical transects will be
21 recurrently visited, month by month, and then they
22 desire to establish six new sites to be visited month
23 by month, for a total of 20 sites monthly visits,
24 complete sets of samples taken on a monthly basis
25 throughout the duration of the discovery period,
40
1 through basically the end of February.
2 The United States contested that the number and
3 intensity is unwarranted, and given the nature of the
4 area and the nature of the already available evidence
5 that that was excessive.
6 You suggested that the opposing parties and
7 allied interests go back to the well and consider
8 something on the order of perhaps, and I took this
9 from the transcript, seven of the historical and
10 six or seven new sites, because you recognized that
11 they had established sties, for a total of 14 versus
12 20 sites recurrent, to cut down on both the manpower
13 drain and the expanse and the impact on the resource.
14 (WHEREUPON, DR. LUKE LEFT THE HEARING ROOM.)
15 At our meeting this morning we were advised that
16 the League and its allied interests were going to
17 insist on the 20 sites and were prepared to put
18 witnesses on as to whether samples can be split or
19 not.
20 That's sort of where we stand on that.
21 HEARING OFFICER: All right. So that is not
22 going to be one of those issues that's going to be
23 resolved? We will deal with that. So we have three
24 issues to deal with today. Does everybody agree on
25 that? All right.
41
1 (WHEREUPON, DR. LUKE ENTERED THE HEARING ROOM.)
2 MR. WATTS-FITZGERALD: In a spirit of mutual
3 accommodation and cooperation, or at least one-sided
4 accommodation, the United States will accept the
5 provision of replicate samples by the League and
6 its allied interests as opposed to truly splitting
7 the samples that are taken, provided their field
8 personnel in fact pull the extra samples for the
9 United States, so there will be no dispute later that
10 our field people used some technique so widely
11 divergent from the one employed by the field personnel
12 that the testing becomes an issue.
13 We would rather that not be something that
14 anybody has to address later.
15 (WHEREUPON, A BRIEF OFF-THE-RECORD DISCUSSION
16 WAS HELD.)
17 MS. KAVANAUGH: Mr. Hearing Officer, we also in
18 a spirit of accommodation, as we indicated to the
19 United States this morning we have no problem
20 replicating, never have had a problem of replicating.
21 However, we have indicated to them that will of
22 necessity take longer at the site and could prolong
23 it.
24 We don't know frankly until we get in the field
25 how much time is going to be involved, so it could
42
1 cause a problem where it will take longer, and we're
2 prepared to offer expert testimony to say why.
3 And we would also be willing to wait until the
4 overflight and the decision about establishment of
5 the six new stations to address the question of
6 whether we need 20 sampling stations.
7 As I understood our discussions last time, you
8 said perhaps we won't need six additional, and perhaps
9 we can go with the 14. Mr. Burgess says we may need
10 only two. We don't know. There's no way we'll know
11 until we have the overflight and can see where those 14
12 sites are.
13 Our scientists may tell us those in fact are
14 representative sites, so we would be willing, subject
15 to Mr. Burgess' poking me in the back and telling me
16 otherwise, we would be willing to defer that issue to
17 the discussions, the overflights and then the
18 discussions between scientists, Mr. Burgess, and
19 Mr. Watts-Fitzgerald, but we would like to do the
20 overflights on October 6th, is that the date?
21 Then we can get this moving along. We have
22 some, as you know, serious time problems as to the
23 wet/dry season.
24 HEARING OFFICER: Mr. Fitzgerald, is that amenable
25 to you?
43
1 MR. WATTS-FITZGERALD: It's superficially very
2 attractive, Mr. Hearing Officer. I have a couple of
3 minor problems with it.
4 First, in their pleadings they have already said
5 the basis is that the existing sites are not
6 representative. Their experts sitting here, whom
7 I know from a certain exposure around the South
8 Florida Water Management District know generally
9 where those sites are. It's a matter of public record
10 where they are.
11 They are truly representative of the Loxahatchee
12 area. They are along the canal, they are in the
13 north, they are in the south, and the interior marshes.
14 They are well distributed throughout that piece of
15 territory.
16 So I have a little problem saying we have to wait
17 for an overflight.
18 Secondly, their experts have also visited
19 Loxahatchee in the past. They have been on the
20 ground, and they have been in the airboats, and they
21 knew the terrain or ought to, or they would be
22 incompetent anyway, and so I have difficulty buying
23 into an argument beyond that 15th of October when we
24 again will have to come back and say, "Let's resolve
25 this issue." I'd like to put this to rest.
44
1 MR. BURGESS: I'd like to know which one of my
2 experts has been in an airboat in Loxahatchee.
3 HEARING OFFICER: Hold on. I guess from what
4 I'm understanding from what they're saying and from
5 what I gather you said before, we have a problem,
6 number one, in determining how many historical sites
7 you may be able to locate, so don't we need to know
8 how many of them we're going to need to locate before
9 we can determine exactly, you know, where the sites
10 are going to be established?
11 MR. WATTS-FITZGERALD: We are not prepared to
12 guarantee every one will be found, but we know where
13 targets still exist, and we have a fairly good
14 degree of confidence we will be totally not left in
15 the lurch on historical sites. There are more than
16 14, incidently. The 14 that will be the recurrent
17 monitoring sites we expect to be able to locate,
18 because they are designated as monitoring sites.
19 HEARING OFFICER: Okay, so you're saying you
20 want to go forward today and have all the sites
21 designated as to where the recurring testing will take
22 place?
23 MR. WATTS-FITZGERALD: The problem, Mr. Hearing
24 Officer, is precisely as they have pointed out.
25 If they add six more sites, then we're in a
45
1 situation of lengthening the entire process. We
2 agreed last month that we would not currently object
3 to the notion of up to four days, with the
4 expectation and their good faith representation
5 the learning curve would be such that maybe they can
6 do it faster, and they will try to do it faster, but
7 now they're saying, "Well, we now have to do a
8 replicate."
9 They have been offering that all along, but now
10 it's going to take longer, "Because we're going to do
11 replicate samples."
12 Seven to 10 days on the initial, including the
13 one day for the aerial, ought to be more than
14 sufficient time on a single station visit, and on the
15 setup stations to take those replicates and be done
16 with them.
17 The water samples on a monthly basis take next
18 to no time at all to conduct. You talk about
19 filling a jug.
20 MR. BURGESS: Until today we haven't had any
21 offer that duplicates or replicates were sufficient.
22 Our pleading, our request clearly states up to 10
23 days is required to collect our three replicates.
24 If there are additional core samples it may add
25 additional time.
46
1 We're not prepared to say what that period of time
2 will be. Their observers are going to be there. I
3 assume that they're going to point out an area where
4 you can take one right next to the one we take,
5 and therefore it shouldn't take very much longer,
6 but we don't want to be hamstrung on the seven to 10
7 days way ahead of the fact without having the initial
8 aerial overflight.
9 And similar with respect to the additional
10 sites. What we're offering to do, since there appears
11 there may be remaining issues or decision before the
12 Hearing Officer after October 6th, is to have that
13 aerial overflight occur, the parties put the
14 document together, and all additional issues with
15 respect to the sites be determined at that one hearing
16 on that subject.
17 It was just an accommodation to I think dispose
18 of this issue and move on to the other two that we
19 offered after they moved to accommodate us.
20 HEARING OFFICER: I think we're arguing about a
21 lot of things we may not, I mean, we are presupposing
22 there's going to be a delay in taking replicate
23 samples, when there very well may not be. If we get
24 into a situation where the first time out this thing
25 gets delayed, then we can worry about it then.
47
1 But it would seem to me it's not going to be
2 that big a deal to take the replicate sample, and
3 it shouldn't overly extend the time period, and then
4 if it turns out it does, then bring somebody in
5 there and tell me why, and you tell me why it
6 shouldn't, and we'll deal with that issue then.
7 But in terms of the site itself, I think what I
8 suggested last time is that, you know, there was, I
9 would have to go, I haven't read the transcript, but
10 as I recall the issues as they were framed last time
11 there was a question as to whether there had to be
12 monthly testing at every historical site and so many
13 new sites, and what I suggested was, "Well, take a
14 sample of the historical site, and take a few new
15 sites, and try to reach accommodation there."
16 That's what I thought was a reasonable approach
17 to try to deal with these issues.
18 It still seems to me to be a reasonable
19 approach, and I don't know why that's not a workable
20 situation.
21 MR. BURGESS: We're prepared to put evidence on
22 today, if Your Honor desires.
23 MS. KAVANAUGH: We haven't presented, and I'll
24 try to comment on what Mr. Fitzgerald presented, and
25 we will present testimony, but we are saying we have to
48
1 use all of those stations, and we will present
2 testimony as to why we do.
3 I guess what we're saying is we agree with the
4 approach you suggested. We just aren't prepared to
5 sit down and work it out, because we haven't been in
6 the field yet.
7 If we go in the field it may well be that
8 Dr. Davis or other investigators say, "We don't need
9 six." That's, we just don't know. That's all we
10 were suggesting.
11 HEARING OFFICER: All right.
12 MS. KAVANAUGH: We're prepared to defend the
13 program as it is.
14 HEARING OFFICER: It seems to me to be a
15 reasonable approach to get the oversight, I mean the
16 overflight, and try to figure out if there is a
17 disagreement. It may be after the overflight you
18 can reach an agreement that, you know, "We'll do this
19 many historical sites and this many new sites in
20 this area," and then there may not be a problem.
21 I mean, do you have a problem with that
22 approach? I don't understand your objection.
23 MR. WATTS-FITZGERALD: I'm a little concerned
24 that this is going to lead to further delay. We
25 were unable to agree this morning that the record
49
1 last month established this should all cut off by
2 1 March, which is the close of discovery.
3 Our concern is right now on the expert
4 designations we have a long list from that party
5 saying, "Nobody has any decisions yet; nobody knows
6 any formal positions; we're not giving you the basis
7 for the positions until conclusion of all work."
8 To the extent that anything delays further
9 actually getting out there or to the extent that the
10 intensity of a sampling regime is overstated and
11 overdone and thereby takes additional time to
12 produce the data, we are looking at a delay in the
13 ability of the United States to find out what the
14 case is about.
15 We have seen so little at this point, and the
16 second amended petition that was served on us
17 yesterday served only to in fact de-emphasize the
18 particulars of their concerns and go with such
19 generalities that we're having difficulty figuring
20 out what type of case is going to be presented
21 before you, if any, when we go to hearing in April.
22 To the extent this raises concerns for the
23 timing issue of their experts' resolution of
24 development of some opinion, we are concerned.
25 HEARING OFFICER: Okay. Well, let me just say to
50
1 the extent that I'm able to do so, it is going to be
2 my goal to try to make sure that this case does not
3 become any more protracted than necessary.
4 You know, at this point I'm still handling a
5 bunch of other cases, but I am in the process of trying
6 to work that out so I can focus even more on this,
7 and I do intend to stay on top of it and make sure
8 this moves forward on a timely basis, and if I sense
9 that there are any of the parties trying to delay
10 the process, them I'm going to react accordingly.
11 I think that's contrary to what the Legislature
12 directed and to what my role in the process is.
13 So I do not intend in the, for this administrative
14 proceeding to be an unnecessary source of delay in
15 the entire, overall scheme of things, so I will do my
16 best to try to keep that going.
17 At this point I do not sense that there has been
18 an effort to unduly delay on the part of any of the
19 parties. I think the hurricane obviously caused
20 some problems, and I think as we discussed before
21 the petitioners in my view have a clear right to go
22 out to the Park and to the Refuge and conduct
23 testing.
24 If the extent and the repetitiveness and how
25 often that has to be done, that's another issue, but
51
1 the first step is to establish the sites and
2 begin the testing process. We need to get that
3 moving.
4 I think the most logical way to go about
5 getting that started is to do the overflight, make a
6 final decision as to what those sites are going to
7 be, how many of the historical sites, how many new
8 sites, and then begin the process, and after the
9 initial samples are taken there may be a
10 determination that monthly sampling is not necessary.
11 I think that's what we discussed last time.
12 There may be a determination that it is. But
13 once the initial access has been done and the experts
14 have had an opportunity to take their initial samples,
15 the parties can get together and see if there is a
16 consensus.
17 If there's not, then immediately bring it to
18 my attention, and let's take it up, and we'll move
19 from there. I think that's the best way to keep
20 this process moving.
21 MR. NETTLETON: Mr. Hearing Officer, on behalf
22 of the District, our primary concern is to avoid
23 delays as well, and I just may be would like
24 clarification from the League, because I don't
25 understand what they proposed, and that is are they
52
1 talking about the overflight at that time their
2 experts would be in a position to decide how many
3 additional sites there would be, or we would have to
4 get into the actual sampling first and analysis
5 before we decide if we need additional sites? I'm,
6 when are we going to make that decision?
7 MR. BURGESS: I think we will be in a position
8 after the overflight to handle all remaining issues,
9 including the number of additional sites that may be
10 necessary. If we're able to land during the aerial
11 recon for the 14 additional sites in the helicopter
12 and accomplish that in one day, we'll be in a position
13 to come back and propose in the single document
14 that we're talking about putting together where we
15 want to go and how often.
16 As we said earlier, it may be 14, and it may be
17 six additional, maybe two additional, maybe no
18 additional. We don't know. We'd like the
19 opportunity to conduct the overflights, land, meet
20 with our experts, propose a single document, and
21 come back before the Hearing Officer for final
22 determination of all issues on the Refuge access.
23 HEARING OFFICER: All right, I don't have my
24 calendar in front of me. Does anyone know what the
25 next date is we have scheduled?
53
1 MR. WATTS-FITZGERALD: The 30th of October.
2 HEARING OFFICER: The 30th of October? Let's
3 set up either a telephone conference hearing or if
4 you want to do it in person we can be here on the 17th.
5 Let's do it the day after.
6 MR. WATTS-FITZGERALD: That's a Saturday.
7 HEARING OFFICER: The 15th was the day you were
8 to try to reach agreement, and the 16th, we can either
9 do it by telephone or do it here, and we'll resolve
10 any outstanding issues on that sampling issue, the
11 sites, and the frequency.
12 If there's no consensus, bring witnesses, and
13 let's get it resolved. Friday, the 16th.
14 MR. WATTS-FITZGERALD: At one o'clock?
15 HEARING OFFICER: Yes. Well, I mean, I don't
16 know if you want to do it by phone or whether,
17 well, if we do witnesses we may need to do it here.
18 MS. KAVANAUGH: Let's assume that.
19 MR. WATTS-FITZGERALD: Maybe we'd want to start
20 at ten in the morning, to make, to be on the safe
21 side. Perhaps it won't come to that.
22 HEARING OFFICER: Why don't we set, we'll set
23 it for ten o'clock on the 16th. This will be a
24 supplement to the one we'll still have on the 30th.
25 And hopefully once the overflights take place and
54
1 there has been some opportunity to discuss it
2 there will be consensus reached as to...
3 MS. KAVANAUGH: And we'll try to do it on an
4 expedited basis. Ms. Ponzoli and I have agreed not
5 to be there, so perhaps it will go well.
6 HEARING OFFICER: All right. So that takes
7 care of that issue then hopefully once and for all.
8 There is agreement there will be replicate rather
9 than split samples. The frequency and the sites
10 themselves will be discussed following the overflight,
11 and we will resolve that on the 16th.
12 Okay. The next two issues are the U. S. access
13 to the petitioners' property and the financial
14 information. Any preference as to which one we need
15 to do first?
16 MR. GREEN: If you would reverse the order from
17 what you just stated that would be our preference.
18 HEARING OFFICER: The financial information
19 first?
20 MR. GREEN: Yes, sir.
21 HEARING OFFICER: All right. In connection
22 with the financial information, I did get an
23 opportunity to read the various pleadings the parties
24 have filed in connection with that.
25 One of the issues that I guess that I have
55
1 reviewed it based on documents filed by the League
2 is their position that a lot of the issues of,
3 that may have put financial condition at issue in this
4 proceeding have been withdrawn as a result of the
5 second amended petition.
6 I have skimmed over the second amended petition,
7 and I have not had an opportunity to study it in any
8 great detail.
9 There were one or two paragraphs that were
10 included within the second amended petition that I
11 questioned whether it still raised some of the financial
12 issues that were involved, but having said that
13 the way that the argument was presented by the League
14 in its responses or whatever, motion, I don't know,
15 at this point I get lost as to who's filing what,
16 but...
17 MR. SAXE: Mr. Hearing Officer, Keith Saxe with
18 the Justice Department for the United States.
19 There may be a threshold process question here
20 before we are able to address these issues.
21 I received a copy just this morning of a filing
22 by the League, a fairly substantial brief that
23 appears to raise some of the very arguments you are
24 alluding to.
25 Now I have not had an opportunity to review that
56
1 memorandum, and my understanding was, although I
2 was not at the teleconference last Tuesday, that
3 any such supplemental briefing was to be filed and
4 delivered by Friday, and that in fact did not
5 occur, so as a matter of fairness and avoidance of
6 prejudice to the United States I think the United
7 States would request that we deal with this as a
8 threshold question, whether or not that brief should
9 be stricken, and argument on those matters barred for
10 failure to comply with the requirement of the Hearing
11 Officer at the last teleconference.
12 HEARING OFFICER: Well, let me look at these.
13 As I understand it there was a supplemental response
14 that was filed, but there was also the League's
15 original motion for protective order as to confidential
16 Information that was filed on September 25th, and that's
17 the document I'm referring to, and that was filed
18 on Friday.
19 MS. PONZOLI: Sir, it was served by mail on
20 the 25th. You had in the teleconference indicated
21 that if they were going to raise arguments different
22 from or distinct from the Cooperative's that they
23 were to serve that and to give it to the United States
24 by close of business on Friday.
25 They stuck this in the mail on Friday, and I was
57
1 in deposition all day yesterday, and when I dropped by
2 my office I happened to see it, and as Mr. Saxe said
3 he saw it for the first time this morning.
4 MR. SAXE: After arriving on the flight last
5 night I received it this morning.
6 MS. PONZOLI: I think we have a problem with
7 this type of very late filing in violation of your
8 order, and I think we further have a problem that
9 it follows a pattern on failing to meet the deadlines
10 when briefs are due.
11 I have literally had to pick up briefs at
12 their offices, and I have waited in my office until
13 seven o'clock at night on Friday nights trying to
14 get a brief out. I think we have a substantial
15 problem with the filing of the briefs.
16 HEARING OFFICER: Well, let me just say as I
17 recall the way the conversation came down last week
18 I think maybe for the first time during the telephone
19 hearing I alerted all the parties, because there was
20 some question as to whether or not there had to be a
21 motion to compel filings, a motion to compel which
22 arguable only related to the Cooperative's
23 objections, since the Cooperative had filed a motion
24 for protective order, and I thought I made clear
25 during the 21st, I guess it was the 21st, when we had
58
1 our telephone conference hearing, that if the other
2 petitioners also intended to stand by their objections
3 that they needed to and had different arguments that
4 they needed to file it by Friday, that was the
5 intention of what I was saying last week, and that
6 was in anticipation of the U. S. Government filing
7 its brief on the motion to compel, which would put at
8 issue all of the legal arguments and the financial
9 matters and give each of the petitioners an opportunity
10 to respond.
11 So we were all acting under a very tight time
12 frame, and I think, you know, I understand your
13 position of not having had an opportunity to respond
14 to that, and I thought I made it clear that the
15 response from the petitioners should be filed and
16 presented to the U. S. Government and the Water
17 Management District by Friday. If that wasn't done
18 I think that is a problem. I got mine on Friday.
19 MS. KAVANAUGH: Mr. Hearing Officer, this was
20 prepared, so you understand it, it was prepared in
21 the Sarasota Office. Mr. Hyde ensured it was filed
22 here. My understanding, and had I known I would have
23 brought Mr. Bachelor here, was we advised if they
24 wanted to pick it up it was ready, and we would be
25 serving it.
59
1 I don't know what happened to it after that.
2 I'm just telling you that I wasn't on the telephone
3 conversation Tuesday, so I can't represent anything as
4 to that.
5 But certainly they should have had it by Monday
6 if the only way was by mail, and we did not realize
7 Mr. Saxe was the person, he's listed, and we served
8 him, but we did not realize we had to physically
9 deliver it. He's in Washington. Had we known that
10 we would have had that done.
11 HEARING OFFICER: Let's not spend a lot of time
12 arguing over these procedural aspects of it, because
13 we have some very substantive matters we have to
14 deal with.
15 The issues that are raised in the response I
16 think raised some very key issues that we need to
17 deal with, and I think it is important for the U. S.
18 Government to have an opportunity to review and
19 respond.
20 If you need time to file something in writing
21 after this hearing I'll give you an opportunity to do
22 that, and I think that's the best way to handle it,
23 rather than go back and forth.
24 For future reference, and again we did this last
25 time on a very tight time frame, and we've done it
60
1 verbally over the phone, and it may have been a source
2 of confusion, but I think the intent of what I was
3 trying to say was to make sure that the pleading was
4 filed and delivered to the opposite party in time
5 for them to have an opportunity to review it prior
6 to this hearing.
7 For future reference that's the way I would hope
8 all parties would govern themselves, so there's no
9 problem as there was in the past.
10 So given where we are now I think the best way
11 to approach it is to afford the U. S. an opportunity
12 to submit something in writing if they need to.
13 I do think there were some salient points that
14 were raised in connection with the response that
15 was filed by the League and in particular with respect
16 to whether or not the financial issues are pertinent
17 to the scope of the proceeding, in view of the economic
18 study that seemed to be ongoing at the Water
19 Management District now and as to whether or not a
20 lot of those issues are really outside the scope of
21 the case.
22 Now I think the initial petitions that were
23 filed certainly placed a lot of those issues as fair
24 game, and I think at least given the very broad
25 scope of the allegations in the initial petitions
1 that were filed by the League and the Cooperative,
2 they very well subjected themselves to discovery
3 regarding the financial issues.
4 Now it seems to me that the second amended
5 petition that was filed by the League at least
6 removed some of those issues from the scope of this
7 proceeding. Now whether it precluded that or not is
8 another matter, and I think the U. S. Government and
9 the respondents should have an opportunity to fully
10 review that second amended petition and bring to light
11 those aspects of the second amended petition that
12 still deal directly with the practicability I guess it
13 comes down to of some of the aspects of the SWIM plan.
14 But I guess probably the best way to proceed
15 with this is to have the League summarize very
16 briefly what their second amended petition was
17 intended to do, what aspects of it have been changed
18 from their initial petition, and to what extent they
19 do in fact intend to argue the practicability and the
20 financial burden of the SWIM plan on the League and
21 its members.
22 MR. GREEN: Mr. Menton, if it's acceptable to
23 you I would like to address our motion for a protective
24 order filed on behalf of the Cooperative.
25 Our position is somewhat dissimilar to the
62
1 League's position potentially, and I think our
2 arguments are ripe, having been a pre-hurricane filing
3 and so forth.
4 If it's acceptable to you, I'd like to go ahead
5 with that argument.
6 HEARING OFFICER: All right.
7 MR. GREEN: This is an interesting issue, and
8 I don't think there's a lot of guidance in the court
9 cases that we can bring to your attention, but I
10 believe that it may be helpful to you to put this in
11 context.
12 Something you said earlier, Mr. Menton, that I
13 think is absolutely critical, you said the United
14 States cannot raise issues in these proceedings that
15 maybe should have been raised in the SWIM plan but
16 weren't.
17 I think to a certain extent, although it may not
18 be their intention, that's what the request for
19 financial information does.
20 Let me explain why I believe that, what we think
21 we would like to prove in terms of an economic case,
22 and why we think in spite of that the scope of the
23 discovery does not have sufficient materiality or
24 degree of materiality that will justify disclosure
25 of confidential financial information.
63
1 At the outset in our motion for protective
2 order on page three, and I'm sure you have read this
3 document, you will see a very detailed list of items
4 that the United States is seeking disclosure with
5 regard to, payroll and compensation records, tax
6 returns, individual income tax returns, financial
7 statements, dividend distribution information,
8 specific loan information, employment information
9 that gets down to the very people involved for five
10 years, and in most of these cases we're talking about
11 five years worth of information, and so on and so
12 forth.
13 Now the United States has cited in their
14 motions to compel discovery some very interesting
15 cases that deal with punitive damages, where the
16 financial ability to pay is directly an issue, cases
17 that involve dissolution of partnerships, where
18 claims concerning excess profits and division of
19 profits are obviously the main item in front of the
20 Court.
21 They talked about cases that deal with judgment
22 creditors, where a judgment creditor is trying to
23 determine the ability to pay of a particular
24 defendant.
25 That isn't the case before Your Honor at all.
64
1 This case does not involve the ability of the
2 farmers in the EAA to pay on an individual basis.
3 It doesn't involve their financial resources in that
4 context.
5 What we think it does involve is an assessment
6 of the economic impact on that region that is the
7 type of assessment that DOAH sees all the time for
8 rulemaking. That is an estimate. It's the kind of
9 assessment in fact that the SWIM plan references.
10 HEARING OFFICER: Let me interrupt you for a
11 second. You are saying it involves an assessment of
12 the economic impact of the SWIM plan on the area
13 farmers?
14 MR. GREEN: Yes, sir.
15 HEARING OFFICER: If in fact the petitioners
16 intend to argue the economic impact of the farmers,
17 how can I fully evaluate that economic impact without
18 having information and evidence regarding the
19 financial condition of the farmers?
20 MR. GREEN: Well, I'm glad you asked that question.
21 I'd like to if I could introduce for the record,
22 and I guess this is kind of clumsy, pages, the first
23 two cover pages from the plan and then specific pages
24 151, 152, 153, and 154 of the planning document,
25 which is Volume I of the SWIM plan.
65
1 Mr. Menton, what this document says as I read
2 it, beginning at the bottom of page 152, is that the
3 District is doing an economic impact assessment of
4 the effects of this plan, and at the top of page 153
5 a description of the economic impact analysis study
6 will be included in the SWIM plan.
7 It goes on to say that the project would be
8 available in May, 1992, which is past, and the project
9 would be divided into 11 primary areas.
10 And I haven't provided you with this document
11 before, but I could just summarize, if I may, by
12 saying our view of this is that this is a regional
13 economic impact analysis, not Farmer A or Farmer B,
14 and we would ask, "Well, why shouldn't it be an
15 individual economic impact analysis?" I think it's
16 similar to rulemaking that DER or any other agency
17 might do to impose regulatory requirements upon
18 regulated interests to participate in those proceedings,
19 and under 120.54(2)(b), as you are aware, the
20 Legislature looks to estimates of cost or the
21 economic benefits to person directly affected by
22 the proposed action.
23 In practice that is generic regional
24 information or industrywide information. It's never
25 Mom or Pop.
66
1 What the United States is proposing to do
2 is to shift what is normally a regionwide economic
3 impact statement assessment, which is what the SWIM
4 plan commissioned, into an individual inquiry into
5 confidential financial records, and I'd like to
6 call Dr. Ron Luke to the stand and explain to you
7 why it's necessary and appropriate.
8 MS. PONZOLI: I would note, Mr. Hearing Officer,
9 that Mr. Green gave no notice that he was going to
10 present evidence at this hearing, so I guess we will
11 have to object to the whole line of questioning.
12 I don't know. I mean, maybe we need to bring
13 our economist and put him on the stand and explain
14 why you can't do a regional economic impact analysis
15 if that's the only issue that all the people are
16 putting in question without more detailed
17 information.
18 I mean, what do you want to do in regard to our
19 lack of notice as to...
20 MR. GREEN: Well, Mr. Menton, I believe at a
21 hearing of this type it is customary to bring live
22 witnesses. This is a motion hearing.
23 Dr. Luke will testify in the areas we have covered
24 in our motion for protective order. He's currently
25 available for cross examination.
67
1 MR. WATTS-FITZGERALD: Mr. Hearing Officer, if
2 I may, Dr. Luke, as you may be aware, is the
3 designated expert witness of the party now profferring
4 him.
5 However, as of this date they have still
6 claimed in the only pleading addressing his testimony
7 that he has no final opinions and not expected to
8 have any final opinions until sometime in the future.
9 On that basis alone we would object to him
10 being profferred at this time.
11 HEARING OFFICER: I don't think he's offering
12 as to any opinions directly related to the SWIM plan
13 but to try to explain why, well, I'm not sure
14 exactly why you are offering him. It seems to me the
15 issues that we're dealing with really are legal in
16 nature rather than factual in nature.
17 MR. GREEN: That's correct, Your Honor, and
18 the reason I think it's legally relevant is under
19 Florida case law Your Honor is given authority to
20 balance the pros and cons of granting or denying
21 relief to either side, and furthermore Your Honor
22 is authorized to determine whether the degree of
23 materiality under the Cooper case is sufficient to
24 justify the production requested, and we believe
25 Dr. Luke's testimony is right on point with regard
68
1 to that, and we would put this in a concrete context
2 and allow you to rule on it.
3 HEARING OFFICER: Well, I think, I don't want
4 to get involved in a big evidentiary dispute over,
5 you know, between experts as to what's pertinent or
6 not.
7 It seems to me that the critical issues we have
8 to deal with here are what arguments are going to be
9 made by the petitioners at the final hearing
10 regarding the economic impact of the SWIM plan on the
11 petitioners and their members, and I think if we
12 crystallize those issues then we can determine the
13 extent to which financial information is pertinent.
14 I think that the initial petition at least as I
15 read it was very broadly based attacks on the SWIM
16 plan that arguably left open or opened the door
17 for a challenge, that the SWIM plan if implemented
18 would essentially put a number of the farms out of
19 business.
20 If that's the contention, one of the arguments
21 that's going to be made at the hearing, then I think
22 it does put the financial information of the
23 petitioners and their members at issue, and that's,
24 you know, it's that simple to me.
25 If that's not one of the positions that's going
69
1 to be taken at the final hearing, then maybe the
2 financial information is not at issue, and maybe we
3 don't need to get into it.
4 I guess what I'm looking for from you is an
5 understanding as to what exactly it is that the
6 petitioners intend to offer at final hearing in terms
7 of the allegations that are made in their petition as
8 to practicability of the plan and as to the
9 economic impact of the plan.
10 MR. GREEN: Your Honor, that's precisely why
11 Dr. Luke is here, to describe our economic case.
12 HEARING OFFICER: Okay. Well, if it's going to
13 shed some light as to what the nature of the
14 proceeding is, but I'll give you an opportunity to
15 present the testimony, and hopefully it will
16 crystallize the issues, but I did feel in reviewing
17 the pleadings that have been filed that the League's
18 filing on Friday seemed to address the crux of the
19 matter as I saw it, which was, you know, what are we
20 looking at in terms of the allegations that are being
21 made to challenge the petition.
22 Those to me govern the nature of the issues in
23 this case and therefore the scope of the discovery.
24 So I assume that's where you're going to take me
25 with him?
70
1 MR. GREEN: Yes, it is, Your Honor.
2 MR. SAXE: If I might just have an opportunity
3 preliminary to this presentation of evidence to
4 address a threshold legal question of the relevancy,
5 because I believe the Coop did file a motion for
6 protective order which I believe it did lay out the
7 legal argument upon which it attempts to hang an
8 argument that this testimony should be received now,
9 and I believe that if we can take a moment to
10 address it we may be able to find that the legal
11 question is dispositive, and we don't have to be
12 prejudiced by being put in a position of dealing with
13 testimony for which we have had no notice to prepare
14 rebuttal. So if I might just have one minute.
15 MR. HOFFMAN: There's another threshold real
16 quickly. I like that, threshold. I'd like to know
17 who the Justice Department layers are. They have
18 three or four that pop up like Tweedle Dee and Tweedle
19 Dum whenever they feel like it. Is there any
20 rationale to this giant Justice Department as to who
21 will be arguing? Do we have some delineation?
22 HEARING OFFICER: Well, I think, Mr. Hoffman, as
23 with the League there are certain attorneys that
24 are handling certain aspects of the case in terms of,
25 it's obvious Mr. Burgess is handling a lot of the
71
1 access issues for the League, as Mr. Fitzgerald is
2 doing, and Mr. Saxe is obviously handling this
3 aspect for the Department of Justice.
4 MR. SAXE: Yes, I might mention I have signed
5 pleadings, several that have been filed, fairly long
6 ago in this proceeding. It's no surprise to counsel.
7 HEARING OFFICER: I don't have a problem with it,
8 but I don't want to get into too much double teaming.
9 This in terms of this issue is obviously Mr. Saxe's
10 issue, so go ahead.
11 MR. SAXE: The legal argument that the Coop
12 makes, let me find my place, basically the arguments
13 addressed at page 12 of the United States' cross
14 motion, the Cooperative asserts that the United States
15 does not need these documents, because the Cooperative
16 does not intend to rely on any of them in formulating
17 testimony or evidence.
18 Specifically in the motion for protective order.
19 The League raises this argument in Note 3 on
20 page six of its motion for protective order when
21 it says, "Although petitioners generally question
22 the methodology employed and the findings reached by
23 the District consultants, to the extent they are
24 reflected in the final draft reports issued to date
25 petitioners do not intend to rely on any of the records
72
1 requested by the United States in formulating
2 testimony or evidence at hearing."
3 In response to that argument the United States
4 has noted in its opposition and cross motion that the
5 Cooper and Tennant case cited in our brief at page 12,
6 a Florida decision, one of the Florida Supreme Court,
7 clearly establishes that where a party is required
8 to defend against claims of economic loss, including
9 lost business, increased costs, or reduced profits,
10 that party is entitled to discover the financial
11 records of the claimant relative to those claims.
12 The party need not rely on summary assertions of
13 relevant information, on secondary source compilations
14 of data, bur rather has a right to review relevant
15 source documents.
16 That's a proposition of Florida law as a matter
17 of right of discovery.
18 I think if we can argue and decide that
19 threshold question it eliminates the need for
20 testimony concerning whether or not the Coop in
21 particular intends to use a certain species of economic
22 evidence when it makes its argument.
23 HEARING OFFICER: Well, I don't disagree. I
24 think that's what the law is. In terms of whether or
25 not the petitioners themselves are going to rely on
73
1 the document I don't think that's the test. I don't
2 think that determines whether or not those documents
3 are discoverable.
4 The key is, as I indicated before, whether
5 the issues that will be raised by the petitioners
6 place the financial condition, in other words if they're
7 going to argue the economic impact of the SWIM plan is
8 going to put them out of business and that's one
9 reason the SWIM plan should be rejected, that
10 certainly places a financial condition of the
11 petitioners at issue, and in my mind that opens the
12 door to discovery on this issue.
13 I guess what I was articulating before or
14 attempting to articulate was a question as to exactly
15 what the petitioners are going to contend at final
16 hearing, and that's what I need to have a better
17 understanding of in order to be able to resolve this
18 question, and I think that's where Mr. Green is
19 going.
20 MR. GREEN: Yes, it is, Your Honor, and at the
21 outset I would like to completely disagree with
22 Mr. Saxe's reading of Tennant. They're talking about
23 punitive damage cases where the whole case was about
24 the ability to pay.
25 Okay. That is not what a SWIM plan is that
74
1 affects southeast Florida.
2 HEARING OFFICER: But let me just say if
3 petitioners are going to come in here and claim as
4 part of this case that the SWIM plan ought to be
5 rejected, "Because it's going to put us out of
6 business," then I think the respondents or those
7 defending the plan have every right to go in and make
8 a determination as to whether that assertion is
9 indeed correct.
10 MR. GREEN: Well, Your Honor, if I could
11 proceed.
12 Before we begin with Dr. Luke I'd like to just
13 recall the context in which we find ourselves in
14 this case. The burden of proof issue hasn't been
15 resolved yet, and I would like to remind you of that.
16 HEARING OFFICER: I remember that.
17 MR. GREEN: And, Your Honor, I realize your memory
18 is probably much better than mine, and,
19 secondly, the District through the SWIM plan itself
20 has placed into issue we could contend regional
21 economic impact issues. Those are the only issues
22 we want to talk about.
23 I think there is a line here that will develop
24 that will show you where we are headed, and hopefully
25 it will be helpful to yo in resolving this.
75
1 * * * * *
2 Whereupon,
3 RONALD THOMAS LUKE
4 was called to testify and, having been first duly sworn,
5 was examined and testified as follows:
6 DIRECT EXAMINATION
7 BY MR. GREEN:
8 Q Dr. Luke, please state your name.
9 A Ronald Thomas Luke.
10 Q Dr. Luke, have you been sworn in yet?
11 A No, I haven't.
12 (WHEREUPON, DR. LUKE WAS DULY SWORN IN BY THE
13 HEARING OFFICER, AND DR. DAVIS LEFT THE HEARING ROOM.)
14 Q Where are you employed?
15 A I'm employed with Research and Planning
16 Consultants in Austin, Texas.
17 Q And what are your responsibilities with that
18 company?
19 A I am the owner of that company and its CEO.
20 Q Does that company provide a service?
21 A Yes, sir, it does. The company has been in
22 operation since 1972, and since that time has provided
23 economic/demographic/public policy market research
24 services to public and private clients.
25 It has performed a number of socioeconomic impact
76
1 assessments as well as performing economic impact and
2 damage assessments and other planning studies.
3 Q Dr. Luke, have you yourself been involved in the
4 studies you have described?
5 A Yes, sir, particularly on the major studies I've
6 been sometimes it's called the principal in charge or
7 principal investigator.
8 Q Would you please describe for Mr. Menton your
9 education, training, and background in economics?
10 A Yes, sir, I did my undergraduate work at
11 Harvard College, took my degree in the interdisciplinary
12 program of social studies, which included economics as
13 well as other types of analysis.
14 I did my graduate thesis in agricultural
15 development in East Africa.
16 I was awarded a National Science Foundation
17 Fellowship in Economics, which I used to continue my
18 studies at the Kennedy School of Management in the public
19 policy program. That program is also interdisciplinary,
20 including economics.
21 My major projects while there included an
22 economic futures study on the coast of Maine which was
23 published as part of the book, "The Study of Economic
24 Alternatives for Redevelopment of Inner City Sites," in
25 Cambridge.
77
1 While completing my dissertation I attended the
2 University of Texas Law School and concentrated in
3 administrative law and economic regulation. My dissertation
4 was an analysis of economic costs and benefits of shifting
5 from an institutional to a community model in mental health
6 care.
7 (WHEREUPON, MR. BURGESS LEFT THE HEARING ROOM.)
8 Q Dr. Luke, have you conducted work for public
9 and private clients?
10 A Yes, sir, I have. On the public side I have done
11 socioeconomic work of the U. S. Bureau of Reclamation, the
12 Corps of Engineers, the Department of Energy, Manatee
13 County, City of Denver, City of El Paso, and Mesa County,
14 Colorado.
15 Q I'd like to ask if you can identify a document
16 for me, Dr. Luke.
17 A Yes, sir, it's a professional resume for myself.
18 MR. GREEN: Your Honor, I'd like to tender
19 Dr. Luke as an expert in economic impact assessments.
20 HEARING OFFICER: Well, I don't want to get into
21 experts. I just want to get an understanding of what
22 the issues are we need to deal with and...
23 MR. GREEN: That's fine.
24 MR. NETTLETON: Mr. Hearing Officer, just for the
25 record we'd like to preserve any objections to
78
1 his qualifications, but we can proceed with his
2 testimony.
3 HEARING OFFICER: Okay, again I don't think we need
4 to get into expertise or any of that.
5 BY MR. GREEN:
6 Q Dr. Luke, what were you asked to do in this case?
7 A I have been asked to do a couple of things.
8 Initially I was asked to review the Hazen and Sawyer
9 reports, draft final reports on economic impact and
10 economic benefit of the SWIM plan, which I did, and
11 prepared comments on those reports, which I believe were
12 submitted in August.
13 I was then asked to proceed to prepare additional
14 socioeconomic analysis of the impact of the SWIM plan on
15 the Everglades Agricultural Area and the communities that
16 make it up.
17 MR. GREEN: Your Honor, for the record I'd like to
18 ask Dr. Luke to identify these two documents.
19 A The first one you have just handed me is a copy
20 of the final report evaluation of the economic impact,
21 etcetera, prepared by Hazen and Sawyer, dated July 31,
22 1992.
23 Q And this one?
24 MR. SAXE: Excuse me. Are there copies of
25 these materials?
79
1 MR. GREEN: (Handing documents to Mr. Saxe.)
2 MR. SAXE: Thank you.
3 A The second document is a copy of the comments
4 which were prepared by me regarding those two reports
5 or the draft final versions of those two reports, which
6 was completed in August of this year.
7 MR. GREEN: Your Honor, may we have these marked as
8 exhibits?
9 HEARING OFFICER: Well, again I don't think we need
10 to be taking evidence at this point. I'm just trying to
11 get an understanding of some of the issues that need to
12 be resolved for the positions of the parties with
13 respect to financial information.
14 BY MR. GREEN:
15 Q Dr. Luke, what did you, you said you reviewed
16 the Hazen and Sawyer report.
17 A You got away with my copy. Can I have it back?
18 Q To your knowledge is that the report referenced
19 in the SWIM plan?
20 A Yes, sir, it is. They were a contractor, and
21 there was an RFP, as the SWIM plan indicates, and they were
22 the successful bidder.
23 Q And what sort of study did Hazen and Sawyer do?
24 A They conducted an analysis of the current
25 economy of the Everglades Agricultural Area, and based
80
1 upon that analysis determined the primary economic factors,
2 meaning the base employment sectors for sugar cane,
3 vegetable, and sod production.
4 They then conducted an analysis of the economics
5 of those three agricultural sectors on a baseline basis,
6 meaning a status quo without the SWIM plan, and analyzed,
7 not analyzed, at least described certain alternative features
8 that might occur without the SWIM plan, such as the various
9 agricultural support programs, and they also described the
10 rest of the Everglades Agricultural Area economy, which is
11 primarily a retail and service sector.
12 Based upon that initial analysis they proceeded
13 to look at what the likely economic impact would be on
14 the primary agricultural sectors of both the BMPs, the STAs,
15 the direct removal of agricultural land, and the
16 potential assessments upon the agricultural land to finance
17 the STAs, and they did that using a methodology which is
18 called a model farm, which means than rather than looking
19 at the specific information for Farmer Jones' farm they
20 used publicly available data to define a series of
21 typical or model farms which they could associate with
22 various farms in the Everglades Agricultural Area.
23 It was possible and is possible to construct
24 such models and determine how much of the acreage they
25 may represent, because very detailed public records are
81
1 available on ownership and land use throughout the various
2 counties' Tax Appraiser's Offices on a parcel-by-parcel
3 basis.
4 Based upon that they ran a series of scenarios
5 that indicated what the likely impact of different levels
6 of assessment were in terms of acreage going out of
7 production and defined certain economic criteria as to
8 whether acres would or would not go out of production,
9 and also for defining what the likely bottom line, if you
10 will, of the farms would be and the impact upon the mills.
11 That is what I would call direct impacts as an
12 economist. In other words, looking at the direct impacts
13 of the economic sector which is most directly affected by
14 in this case the government policy but in other
15 socioeconomic assessments perhaps a change in world markets
16 and so forth.
17 They then used county level and regional level
18 multipliers, input/output multipliers, to calculate the
19 indirect and induced demand or impact I should say on
20 revenues for all jobs for Palm Beach County and for the
21 counties that make up south Florida and recorded those.
22 There are brief sections which look at issues
23 of retraining of agricultural workers that Hazen and
24 Sawyer say may be displaced by implementation of the SWIM
25 plan, certain financing mechanisms, and also what I would
82
1 call more of an annotated bibliography that reports that
2 there are certain studies that have been done in other
3 areas which for a variety of reasons have experienced an
4 economic downturn.
5 Q Are you familiar with the type of model that
6 Hazen and Sawyer utilized in the study?
7 A Yes, sir. Well, there are a couple of things
8 that could be called models. First of all, of the farm
9 level impact study they used something called the FLIPSIM,
10 F-L-I-P-S-I-M, model, which is a simulation model
11 developed at Texas A&M under contract with the USDA and
12 has been used intensively over the last 10 or 11 years
13 in analysis of policy and farm bills and this kind of
14 thing, as well as a number of studies in various states,
15 including Florida.
16 A second model they used is what is called the
17 RIMS model, which is an input/output model maintained by
18 the United States Department of Commerce, RIMS standing
19 for Regional Input/Output Modeling System, and there are
20 various tables of multipliers used for everything from
21 direct to indirect and induced.
22 Q Are you familiar with the data that the models
23 require as input?
24 A Yes, sir. I have one of the documentation
25 manuals for the FLIPSIM model, and I have also spent a
83
1 good deal of time with Dr. Richardson, one of the authors,
2 and basically what it is looking for is parameters on
3 the model farm, acreage and how the acreage is divided
4 among the crops. It's looking for some indication of
5 the yields per acre, revenue per acre for the harvested
6 crops, cost of production, taxes, debt structure, and I
7 should say assets and liabilities, and the various policy
8 programs that may be applicable to the specific crop.
9 There are variations in the model for different
10 crops or livestock.
11 Q Are those publicly available?
12 A Yes sir. I have checked, and the information
13 that is necessary to run the model for baseline conditions
14 is available from public sources. In fact, many of those
15 are sources that Hazen and Sawyer used, albeit in some
16 cases used incompletely.
17 Q Do you have an opinion concerning whether the
18 use of the models that Hazen and Sawyer utilized, together
19 with publicly available information, can produce reliable
20 estimates of economic impact on the EAA?
21 A Yes, sir, I do.
22 Q What is that opinion?
23 A My opinion is they can. I have looked, reviewed,
24 if you will, both my comments and those of the League's
25 expert, Dr. Polopolus, at the University of Florida, and
84
1 none of those comments relates to the absence of data
2 of the sort that the intervenor seeks in its discovery.
3 For instance, one of the major objections to
4 Hazen and Sawyer assumed that the farms in the EAA are all
5 free of any debt of any kind. The information, and that's
6 just factually wrong.
7 The information from public sources necessary to
8 put in a reasonable average debt load are available from the
9 same source, literally the same people in the USDA that
10 Hazen and Sawyer used for their expense of production
11 statistics.
12 Likewise there are similar surveys of the other
13 types of agricultural practices, and they simply chose not
14 to put it in.
15 Another objection is that they chose to run the
16 model for only 10 years as the issue of practicality.
17 I have reviewed tapes of the meetings of the South Florida
18 Water Management District in which the Board members make
19 clear in their opinions the STAs will require bond
20 financing on the order of 20 years.
21 The best, the plan itself on page 153...
22 MR. NETTLETON: Mr. Hearing Officer, for the
23 record can I assume all our objections to hearsay
24 and so forth are reserved for any future use of this
25 testimony?
85
1 HEARING OFFICER: Absolutely. Absolutely.
2 BY MR. GREEN:
3 A This specifically states that the study that is
4 in effect made a part of the SWIM plan will be for a
5 period of 20 years, and that's important, because if you
6 don't know what's going to happen for the 20 years you
7 don't know what the bond repayment capability of the area
8 is for purposes of assessment, and you therefore don't
9 know whether it will be practicable to finance with bonds
10 secured by assessments against the EAA producers.
11 There are a number of other objections raised,
12 and I'd be happy to go into them, but to summarize none of
13 them are objections to the quality or the reliability
14 of the public data sources which have been utilized by
15 Hazen and Sawyer. Those are not issues in my comments or
16 Dr. Polopolus'. What's at issue is the incomplete and
17 ins some cases erroneous way in which the District's
18 contractor utilized the data or failed to utilize the data
19 in carrying out the mission that's spelled out in the
20 SWIM plan.
21 One other issue I think is worth noting, that
22 on page 153 it specifically says quantify, "The study seeks
23 to quantify the economic impact on all of the cities and
24 counties impacted by the regulation."
25 There is nothing in the Hazen and Sawyer report
86
1 which gives any quantification of the impacts on any of the
2 specific cities in the EAA.
3 The closest they get are impacts on all of Palm
4 Beach County, which of course the EAA is maybe 10 per cent
5 of, and a very different 10 per cent than the other 90
6 per cent, so part of what I will be doing is what I have
7 done in other studies, which is to bring these impacts
8 down in terms of the impacts upon these individual
9 jurisdictions, and all of that will be done with
10 publicly available data which is reported as a matter of
11 law to the State of Florida and on an annual basis by the
12 jurisdictions.
13 That I think is at least an initial summary of
14 the issues that I and my colleagues intend to address,
15 and the kind of information that is in the intervenors'
16 discovery request is not information that I need, given
17 the discovery schedule, to have time to analyze to
18 utilize, and is certainly not particularly germane to the
19 issues that I intend to raise with regard to the Hazen and
20 Sawyer work in my study and in my testimony.
21 (WHEREUPON, MR. BURGESS ENTERED THE HEARING
22 ROOM.)
23 MR. GREEN: No further questions, Your Honor.
24 HEARING OFFICER: Why don't we take about a
25 10-minute break? You can ask any questions if you
87
1 want to and then go back to regular argument.
2 MR. GREEN: Your Honor, could I proffer those
3 exhibits at the conclusion of this?
4 HEARING OFFICER: Proffer them? I'm not sure...
5 MR. GREEN: I'd like them in the record in the
6 event there is an appeal, obviously.
7 HEARING OFFICER: Okay. Well, you can file
8 them as attachments to your motion for protective
9 order.
10 MR. GREEN: Thank you, Your Honor.
11 HEARING OFFICER: That's the easiest way to do
12 that. Let's take a 10-minute break.
13 (WHEREUPON, THE HEARING WAS RECESSED FROM
14 2:52 P.M. TO 3:11 P.M.)
15 MR. GREEN: Would it be helpful for me to sum
16 up what we will put on before, or would you prefer
17 to cross first?
18 MR. SAXE: I would prefer cross.
19 HEARING OFFICER: Let him go ahead and cross,
20 and then we can sum up.
21 CROSS EXAMINATION
22 BY MR. SAXE:
23 Q Dr. Luke, you testified that you reviewed a
24 draft final economic impact assessment prepared by Hazen
25 and Sawyer, consultants to the District, isn't that true?
88
1 A Yes, it is.
2 Q And you also testified that you prepared and
3 submitted comments describing your opinions and conclusions
4 about what in your opinion are defects in that economic
5 impact analysis, isn't that true?
6 A Yes.
7 Q You mentioned a number of factors in your
8 testimony. You mentioned categories of assumptions that
9 in your opinion were relied upon or utilized by Hazen and
10 Sawyer in reaching its conclusions. You mentioned crop
11 prices, isn't that true?
12 A I don't believe so.
13 Q Excuse me, Dr. Luke. Do you recognize this as a
14 copy of a document you submitted in response to and at the
15 behest of the Cooperative, evaluating the draft final
16 report?
17 A Yes.
18 Q Would you just read for me, please, this
19 paragraph from the first word to the period?
20 A Sure. "These comments assume there is no
21 disagreement over the many assumptions regarding crop
22 prices, yields, expenses, and other factoring which
23 Hazen and Sawyer has made in its studies. Great discussions
24 with representatives of the Cooperatives suggest there
25 are many questions and disagreements regarding these
89
1 assumptions were addressed."
2 This is not my testimony today. These are
3 comments that were filed in August.
4 Q Thank you. Dr. Luke. We don't have the benefit
5 of a transcript to roll back. I thought I heard you
6 mention crop prices as one of the factors that was considered
7 as an assumption in this analysis.
8 Let me go back and reroll some of these
9 questions now.
10 In your opinion isn't it the case that Hazen and
11 Sawyer made assumptions in reaching their conclusions for
12 the District involving such matters as yields...
13 A Yes.
14 Q ...expenses...
15 A Yes.
16 Q ...debts...
17 A Yes.
18 Q ...other costs?
19 HEARING OFFICER: This is Hazen and Sawyer you're
20 talking about now?
21 MR. SAXE: This is the District through Hazen and
22 Sawyer.
23 BY MR. SAXE:
24 Q Other cost factors?
25 A Yes.
90
1 Q Isn't it true that information concerning, for
2 instance, the actual debt information for a particular farm
3 in the EAA might tend to address the dispute between the
4 District and those that have reviewed the report concerning
5 this assumption?
6 A No, it wouldn't. What you would have is the
7 data on debt that the USDA collected that corresponds to
8 the data on costs of production which are in the Hazen and
9 Sawyer report.
10 That data on debt is available from Ms. Annette
11 Claussen at USDA, because it comes from the same survey
12 that Hazen and Sawyer relied on, and they didn't choose to
13 retain it.
14 Q Dr. Luke...
15 A It's a matched set of the same 60 or some farms
16 that responded to the USDA survey that they relied upon.
17 Q Dr. Luke, you mentioned the model farm
18 technique in your testimony here today, did you not?
19 A Yes.
20 Q Is the model farm technique a widely used
21 technique in doing the economic impact analysis for direct
22 economic impact, farm impact assessments?
23 A Yes.
24 Q In the model farm technique isn't it true that
25 one of the standard procedures, one of the widely used
91
1 procedures by those who employ this technique in developing
2 a model farm is to interview groups of individuals in the
3 regulated or relevant community to develop profiles for
4 model farm information?
5 A It may be if there is not a data base already
6 available that has done that.
7 Q Isn't it true that that is a widely accepted or
8 a widely pursued method of developing model farm information
9 for economic impact assessment?
10 A As I said before it is, if that data has not
11 already been developed by another survey, as it is in
12 this case.
13 Q Did you conclude, Dr. Luke, or rather let me
14 restate that. Isn't it true you concluded that many of the
15 assumptions made by Hazen and Sawyer in reaching its
16 conclusions were in fact incorrect?
17 A No.
18 Q Just a moment ago you read a passage. Let me
19 ask you if you would read another just to refresh your
20 recollection about your view of the assumptions made by
21 Hazen and Sawyer in the project. If you wold please
22 read number five through to the end.
23 A "The economic impact report makes a clearly
24 erroneous assumption that farmers and mills in the EAA have
25 no debt and have all new capital equipment in the
92
1 beginning of the study period, so that no capital
2 investments are required to maintain operations during
3 the study period."
4 Q Thank you, Dr. Luke. Now let me ask you
5 perhaps in a different way isn't it true that actual
6 information concerning actual debt and actual capital
7 equipment investment by actual farms in the EAA might tend
8 to render it more or less probable that the Hazen and
9 Sawyer assumptions on those matters are correct?
10 MR. GREEN: Objection to the compound question.
11 It's ambiguous.
12 Q Let me clarify it. Would such actual
13 information from actual farms in the EAA be relevant to
14 assessing the correctness of the Hazen and Sawyer
15 assumptions?
16 A No, because Hazen and Sawyer it says in the
17 report, and Grace Johns has said in subsequent testimony
18 regarding the report that she acknowledges those are
19 incorrect assumptions which she made only as simplifying
20 assumptions in her analysis.
21 The data that is obtained from the USDA
22 specifically contains the average debt loads of the farms...
23 Q Dr. Luke, I'm not asking you, excuse me...
24 A ...corresponding to her assumptions about
25 production prices, and so the data from specific, individual
93
1 farms within the District on their current debt would not
2 be as relevant as simply getting the publicly available
3 data...
4 Q Dr. Luke, excuse me...
5 A ...from the USDA.
6 Q ...clarify. I was not asking you for your opinion
7 about Dr. Johns' opinion of what would be relevant to
8 assessing the truth or the error in the assumptions she's
9 using.
10 What I am asking you is isn't it true that
11 actual information about debt in the EAA if, assume for
12 purposes of my question, it was widely discrepant with or
13 varied from or disagreed with the assumptions that Hazen and
14 Sawyer used or made concerning debt, would tend to make
15 those assumptions seem less probably correct?
16 A I don't understand the syntax of the question.
17 Q All right, let me try to restate it. Would
18 actual information about debt that differed from Grace
19 Johns, from Hazen and Sawyer's assumptions...
20 MR. GREEN: Objection. Pardon me. I'm not
21 trying to disrupt your question. I'm trying, you're
22 saying actual debt.
23 MR. SAXE: That's correct.
24 MR. GREEN: I think that's ambiguous. Please be
25 more specific.
94
1 BY MR. SAXE:
2 Q Would information about the debt of given
3 farms, individual farms in the EAA, let me see if I can
4 approach it this way.
5 Isn't it true that Hazen and Sawyer assumed
6 zero long-term debt for purposes of their economic impact
7 assessment?
8 A I believe they assumed zero debt of any kind.
9 Q Isn't it true that they assumed zero long-term
10 debt?
11 A As a component of total debt?
12 Q If you would just answer yes or no I'd
13 appreciate it. It's a simple question.
14 A I don't believe it is. That's why I'm trying
15 to give you a complete and correct answer.
16 Q Is it true that Hazen and Sawyer considered
17 debt, made an assumption concerning debt, is it true that
18 Hazen and Sawyer assumed there was zero long-term debt
19 for purposes of its economic impact analysis?
20 A I would...
21 Q Isn't that true? Isn't it true that you have
22 formulated an opinion on that and you have read it to us
23 today on the record?
24 A They made the assumption as a simplifying
25 assumption. I do not believe for a minute that Grace Johns
95
1 and her organization...
2 Q Dr. Luke...
3 A ...approved things...
4 Q ...would you please just re-read this
5 sentence without...
6 A ...there is no debt on farms.
7 Q Dr. Luke, would you please read the sentence
8 without the editorial comments?
9 HEARING OFFICER: This is getting a little
10 more argumentative than it needs to be. I think
11 the question was simply whether the study as it was
12 prepared went under the assumption there wasn't a
13 long-term debt in the development, and I think that's
14 what you already testified to.
15 A I think what I mean, I'm simply trying to
16 distinguish between something one assumes because they
17 believe it to be true facts and a simplified assumption.
18 HEARING OFFICER: I understand that, but I
19 think the question was simply whether the study as
20 it was performed had that assumption in it.
21 DR. LUKE: It did.
22 Q My next question is isn't it true that collection
23 of actual debt information from actual farms in the EAA
24 assuming it showed there was long-term debt would tend to
25 draw into question Hazen and Sawyer's assumption concerning
96
1 long-term debt?
2 A If hypothetically that happened, it would draw
3 it into question.
4 Q Thank you. I just have one small set of
5 followup questions.
6 You referred in your testimony earlier to
7 Dr. Larry Leistritz, did you not?
8 A Yes.
9 Q You referred to Dr. Leon Leistritz, did you
10 not?
11 A Yes.
12 Q You referred to Dr. Curtis Richardson, did you
13 not?
14 A James Richardson.
15 Q Excuse me. James Richardson. Isn't it true
16 that you have, excuse me. Let me restate that.
17 Have you had conversations with these individuals
18 concerning the matters about which you are giving
19 testimony now?
20 A I have never spoken with Dr. Polopolus. As I
21 indicated in testimony I have spoken with Jim Richardson,
22 and certainly Larry Leistritz and I have conferred.
23 Q Do you know for a fact that Dr. Larry Leistritz
24 shares your opinion concerning the utility of actual
25 economic information when doing an economic impact analysis?
97
1 A Sir, I don't think I have expressed an opinion
2 on actual economic impact, whatever you mean by that.
3 Q Let me clarify. Specific information reported
4 by individual agricultural enterprises in an affected study
5 area.
6 A Yes, sir, he and I have conferred and agree
7 that the information that's available from the USDA is
8 quite adequate for purposes of preparing a regional
9 economic impact analysis and doing what the SWIM plan
10 says they will do, which is quantify the impacts on
11 communities and counties in the EAA.
12 Q Isn't it true that you testified you have
13 not consulted on that matter with Dr. Leon Polopolus?
14 A I have never met Dr. Polopolus.
15 Q So then...
16 A And I don't think I represented it was his
17 opinion.
18 Q You didn't. I'm just...
19 A Okay.
20 Q ...trying to establish that although the Coop
21 today has put forward one of their expert witnesses
22 concerning this matter, the petitioners generally have
23 listed several experts and described this particular area
24 of testimony as within their subject matter of expertise.
25 A Well, I understand that, but I assume that what
98
1 we're doing here today is the petitioners are articulating
2 for us exactly the nature of the evidence they intend to
3 present, and I'm taking that as a representation that I
4 intend to hold them to, that the testimony of their other
5 witnesses will be along the same lines.
6 Q I have no further questions at this time.
7 HEARING OFFICER: Well, I don't mean
8 necessarily that the testimony is going to be
9 exactly the same, but that they're not going to be
10 talking about specific impacts on individual farms
11 or getting into testimony of that nature.
12 MS. KAVANAUGH: We stand by what we have
13 filed, and we want it made clear we do not concur
14 completely with the Coop's position and also stated
15 at closing. We would reserve any objections we
16 might want to have, too.
17 HEARING OFFICER: Mr. Nettleton?
18 CROSS EXAMINATION, CON'T
19 BY MR. NETTLETON:
20 Q Dr. Luke, this report that's been identified
21 for the record, is this the only report you have prepared?
22 A Yes, sir.
23 Q Do you plan to revise this report in the
24 future?
25 A As a free-standing document I don't. I'm
99
1 certain some of the subjects that are dealt with in that
2 report I would expect would be dealt with in additional
3 work that might be done between now and the date of the
4 hearing.
5 Q Does this contain your opinions at this time
6 concerning Hazen and Sawyer's economic analysis report?
7 A I would not say it dos completely. I have had
8 an opportunity since this was finalized to see the
9 presentation that Richardson and Polopolus have prepared.
10 I had not spoken to any of them at that time. And certainly
11 were I doing this document again I would endorse some of
12 the concerns they have also raised.
13 Q Does this report contain, is anything in this
14 report since you prepared it, do you feel it's inaccurate
15 at this point, or that you would have changed your opinion
16 with regard to?
17 A When you say anything that makes me go back.
18 I want to just look at it for a second.
19 Q That's fine. I just looked at it myself.
20 A (Reviewing document.) I think the sense of the
21 report, I would not want to withdraw anything I have said
22 at this time.
23 Q Okay. What additional opinions would you
24 include in a subsequent report in light of your testimony
25 you made concerning other people's presentations?
100
1 A Well...
2 MR. GREEN: I'm not sure I really object, but
3 let me just say of the record that his opinions are
4 not final, and I would not want him to be held to...
5 HEARING OFFICER: The purpose of his testimony
6 today is not to, this isn't a discovery deposition,
7 nor is this his final testimony at hearing. I think
8 what you have done is offered him to give an
9 illustrative, to five me some idea of what the nature
10 of the testimony he's doing to offer is going to be,
11 and that's what I have taken it as. I don't mean to
12 hold him to...
13 MR. NETTLETON: I'm asking him whether he has
14 any additional testimony he plans to present.
15 HEARING OFFICER: Right.
16 DR. LUKE: I'm sorry. I kind of lost the
17 thread. Are you saying would I add anything to the
18 previous comments?
19 BY MR. NETTLETON:
20 Q You had previously mentioned since you prepared
21 this report you heard presentations by some additional
22 economic experts retained by some of the other
23 petitioners, and that you would endorse those presentations
24 or those opinions. Can you tell me what additional
25 opinions you would endorse in that regard?
101
1 A Yes, I would. I think that the amount of time
2 that Hazen and Sawyer was given and took to try to
3 prepare a regional economic impact statement to the community
4 level was wholly inadequate in the studies that I have
5 done where we went from the primary economic impacts all
6 the way down to the community level where we started from
7 scratch, typically have taken nine months to a year or more,
8 whereas Polopolus presents I think a year is right, and
9 really their period of activity was only a few months, and
10 I think in one event the contract was even amended to a
11 10-year impact study, because they didn't have time to do
12 it.
13 And I agree completely that they really weren't
14 given adequate time to do an adequate study.
15 Secondly, I think that the comments that are
16 in there regarding variability of yield and variability of
17 returns and what they refer to as the statistic variable is
18 the feature of the model, the FLIPSIM model, that
19 certainly ought to be used.
20 In effect agriculture is a year-by-year gamble,
21 and it's like any other gambling game. Part of it is a
22 question of the sequence of good years and bad years,
23 and that's what they attempt to measure, and I think
24 that's appropriate that it be in there.
25 There are some other things, and this on pages,
102
1 this is material, this is Section III really of the
2 Polopolus presentation to the District on August 7.
3 Q Is there anything in that Polopolus presentation
4 you disagree with?
5 MS. KAVANAUGH: For the record, Mr. Hearing
6 Officer, Dr. Luke is not retained by us, but for other
7 purposes outside this hearing. I'm concerned with
8 all this. I want to make sure Dr. Polopolus'
9 opinions are not at issue here, and we're not...
10 MR. NETTLETON: Okay, I'll move along.
11 HEARING OFFICER: Okay.
12 MR. SAXE: He's listed as one or your expert
13 witnesses.
14 MS. KAVANAUGH: Only for rebuttal purposes, which
15 hopefully it won't...
16 MR. NETTLETON: I hope it doesn't.
17 Q Could you please again tell me the name of the
18 model that Hazen and Sawyer used for their economic analysis?
19 A There are two that I would identify as models
20 within the report. One is FLIPSIM, and if you look in the
21 bibliography, just to make it easy, it's miscited, but
22 it's under Clark, Neville P., description of FLIPSIM V.
23 Q Go ahead and just give me the name of the other
24 one.
25 A The other one is called the RIMS II model,
103
1 and that's on page nine of the bibliography, cited U. S.
2 Department of Commerce, Bureau of Economic Analysis,
3 regional multipliers and so forth.
4 Q What is the FLIPSIM model used for?
5 A The FLIPSIM model, it stands for Farm Level
6 Impact Policy Simulation Model, and the reason that it was
7 developed was to allow farm level measurement for a variety
8 of different farm types of mainly policy changes in the
9 federal agricultural policy and tax policy, and it was
10 developed under contract by Texas A&M, a contract from the
11 USDA, and used to prepare material for Congressional
12 committees on likely impact of various farm policy
13 proposals, among other things.
14 Q When you say impact you're talking economic
15 impact?
16 A Yes, sir.
17 Q What about the RIMS II model? What is that
18 used to measure?
19 A That's used to measure the indirect and
20 induced economic impacts of a change in a region's economy.
21 It's based on data collected by the U. S. Department of
22 Commerce and is compiled in a way that produces tables
23 of multipliers, and you can look at it, they look at it as
24 small as a county area, or you can look at the impact in
25 a multi-county area.
104
1 It's a way to say if you reduce output of
2 agriculture in Palm Beach County by a million dollars, we
3 know that, a year, we know that that ripples through the
4 economy, because that million dollars went to pay people and
5 buy things, and they in turn bought other things, and that's
6 the ripple of the multiplier effect, and there is data
7 collected by the U. S. Department of Commerce that measure,
8 if you will, the size and where they go in the economy.
9 Q Okay. The FLIPSIM and the RIMS II, are those
10 accepted methods of modeling and determining economic
11 impact in the economic field?
12 A FLIPSIM from my investigation is very well
13 accepted for measuring what it is intended to measure,
14 farm level impacts.
15 RIMS II is a standard source that is relied upon
16 not only in agricultural analyses but also in a wide range
17 of impact studies.
18 Q You don't have any problem with the methodology
19 of using those, when I say methodology I mean the models
20 themselves?
21 A Yes, if I could use the word selection. I don't
22 have any problem with the selection of those. My problems
23 are with the way they have employed them.
24 Q Can you tell me what materials are necessary for
25 input of data into the FLIPSIM model?
105
1 A Yes. The information that actually Hazen and
2 Sawyer includes here on acreage and yield an expenses of
3 production are necessary. Also necessary to full
4 utilization of the model is to include information on
5 balance sheets, as opposed to P&L type items, which were
6 collected in the same survey that they rely upon.
7 Q You will have to excuse me. I don't understand
8 what you mean by that.
9 A Well, if you think about from a financial
10 statement, you have a balance sheet, assets and liabilities,
11 and you have a P&L, revenue and expenses, and in effect what
12 Hazen and Sawyer did was they utilized the revenue and
13 expense portions of the USDA data and put those into the
14 model but did not put in the asset and liability, which
15 includes debt, of course, portions of the data available
16 from the USDA for the model, and the model would have
17 also accepted and cranked it into its analysis.
18 They also did not put in, they did not turn on
19 I think would be a better way to say it the federal income
20 tax portion of the model, which really doesn't require,
21 all it requires is whether you designate a model farm as a
22 corporate partnership or a proprietorship.
23 Other things they would need for that model,
24 in effect you need a future forecast of the crop prices.
25 and you need future forecasts of change in expenses, which
106
1 is usually done through data on indices produced by the
2 National Agricultural Statistics Service, another part of
3 USDA.
4 You would also need some information on the
5 machinery complement that is used for the specific crops,
6 and that comes both from USDA and from the Florida
7 Institute for Food and Agricultural Studies and Sciences.
8 Q Any other data you would need to input into the
9 model?
10 A There's a long list of every specific variables
11 in the documentation that's cited here, and I don't want to
12 tell you I have listed every last one, but I think I have
13 covered the main categories, and the complete answer is
14 available through the documentation, I believe.
15 Q Which documentation are you referring to?
16 A This is page two of the bibliography in the
17 Hazen and Sawyer report, Clark, Neville P., description of
18 FLIPSIM V, general farm level, Farm Level Policy
19 Simulation Model, and this is July, '86, documentation, and
20 there have been some revisions to it, so there might be
21 minor changes from this.
22 Q What about the RIMS II model? What type of
23 material would you need to input into that?
24 A What you, the RIMS II model, what you need is
25 your estimate or projection of the change in output and
107
1 employment in the primary employment sector, in this case
2 agriculture, and then you input that into the various
3 multiplier tables, and it gives you by multiplying it
4 through, that gives you the indirect and induced change in
5 output and change in employment.
6 Q Is that the only data you input into that
7 program?
8 A Basically, yes, sir.
9 Q What is the source that you received all this
10 data from?
11 A All this data is a little confusing.
12 Q Let me go through. The acreage and yield data
13 that goes into the FLIPSIM model.
14 A The actual acreage data for the, that was used
15 in the Hazen and Sawyer study came from the appraisal records
16 of the various Tax Collectors. The yield data came from
17 IFAAS, which is a part of the University of Florida, and
18 from the USDA.
19 Q Are there other places to obtain the material,
20 that information?
21 A You know, I think those other places would go
22 back to these places. Let me put it this way. They may be
23 published elsewhere, but they would come back to these
24 sources that I just named to you.
25 Q What about the expenses of production? Where does
108
1 that come from?
2 A That comes from the USDA survey that they do
3 every few years and update annually, and it's in most of the
4 data that's published in "Sugar and Sweetener." This happens
5 to be the I believe June, '92, issue. It's a USDA
6 economic research publication.
7 Q Is that the USDA data broken down by different
8 types of agriculture?
9 A This particular one is broken down by Florida
10 sugar cane production.
11 Q Does the industry agree with the information in
12 the survey?
13 A I haven't surveyed the industry to see.
14 Q What about revenue and expense data? Where does
15 that come from?
16 A The expense data we just talked about.
17 Q The expense of production. What about revenue
18 data?19 A The revenue data, their first study is a projection
20 of what future revenue data would be, and she chose to
21 assume a future of I think $35.30 or something like that a
22 ton, net ton.
23 This document indicates what the payment,
24 average payment per acre is today.
25 Q That's the USDA document?
109
1 A That's correct, and I believe there are other
2 USDA documents that are reported in different forms.
3 Q Is there any source document to provide
4 projections, or is that on each expert he comes up with
5 his best estimate?
6 A Well, the answer to your question is yes, and
7 probably, yes, but there is a Missouri university which has
8 a forecasting service which is kind of a counterpart to
9 A&M, Texas A&M's development, FLIPSIM V, and they provide
10 a lot of commodity price forecasts that are used. I'm sorry,
11 but I can't rattle off the exact name for you.
12 There are certainly through a number of
13 economic forecasting services medium- to long-term projections
14 of various commodity prices.
15 HEARING OFFICER: Let me just interrupt for a
16 second. I don't know that we need to get into all the
17 specifics of where all these exemptions come from.
18 It seems to me the bottom line question that you
19 have today is whether or not the petitioners as part
20 of their case are going to be challenging the
21 assumptions of the Hazen and Sawyer study based
22 upon allegations that it doesn't conform with the
23 actual farm experience in the Everglades Agricultural
24 Area.
25 And if that is the intent of the presentation
110
1 we're going to get from the petitioners, then I think
2 we go back to the question, "Well, maybe that opens
3 up the door to discovery regarding the information
4 that they're going to produce in the," well, it just
5 seems just from what I have gathered from what
6 Mr. Green said and from what the League has filed,
7 it doesn't, that's not going to be the thrust of their
8 testimony, and so regardless of the specifics as t
9 where it will come from, I thin we need to focus
10 back on the question of why we are here today,
11 which is discovery of financial information on the
12 individual farms, as well as the Cooperative and the
13 League itself.
14 In that regard, and I don't mean to cut
15 Dr. Luke off, and we can go back and question, but it
16 just seems we've been going on for a long time here,
17 and we still haven't gotten to the access issue.
18 MR. NETTLETON: Can I just ask a couple more
19 to finish this up?
20 HEARING OFFICER: Sure.
21 MR. NETTLETON: And I won't continue with the
22 other sources.
23 BY MR. NETTLETON:
24 Q I'd just like to ask you, Dr. Luke, the IFAAS
25 material, the information that is set forth in the USDA
111
1 surveys and all that information, where does it come from?
2 A Pardon me?
3 Q Where does it come from?
4 A Well, ultimately it comes from the various
5 types of information provided by the producers.
6 Q So it comes from the individual farms, right?
7 A From some individual farms, yes.
8 Q Isn't it true that generally with regard to
9 opinions regarding economics and forecasting into the
10 future that the better the data you have from the history
11 of what you're forecasting the better the results or
12 abilities to reach conclusions?
13 A I think that's true to point. You can sometimes
14 get so lost in the accounting detail that you are not
15 spending the time on the kind of major economic trends and
16 factors, which are where the change will occur.
17 Q If you have a problem with a modeling technique
18 isn't it true that the more specific your data is with
19 regard to the specific thing you're trying to analyze the
20 more accurate your conclusions will be?
21 A No, to give you an example, the problem with
22 the modeling technique of Dr. Johns' use of FLIPSIM has
23 nothing to do with the data she chose to use. The problems
24 with the modeling technique are she didn't run it 20 years.
25 She didn't include the balance sheet information that was
112
1 available. She didn't consider the impact of the federal
2 income taxes on the financial reserves of the model farms.
3 None of those would be improved by going back and
4 spending a lot of time and money getting the expensive
5 production data, resurveying the survey the USDA has
6 already done.
7 Q Have you run this model with all the
8 information you say should have been included?
9 A I personally have not. The closest to that having
10 been done was the Polopolus and Richardson presentation on
11 August 7, and they were very clear they were not trying to
12 do a complete run, just trying to do a preliminary
13 critique of the Hazen and Sawyer report.
14 Q Are the FLIPSIM and RIMS models the only means
15 of evaluating an economic impact on an area?
16 A Well, they are categories of models, the FLIPSIM
17 Is what you would call a simulation model and is a four-train
18 computer program that embodies certain logical relationships,
19 and so to say it's the only means would be incorrect,
20 because you and I could go out and spend months or however
21 long it took and write our own program, but I think for
22 analysis of this type, I think there would be general
23 agreement what's called an annual recursive simulation
24 model, meaning where we end up in year one determines where
25 we start in year two, is the right way to do it, and I'm not
113
1 really aware there are a lot of competing alternatives in
2 that regard.
3 Now in terms of input/output multiplier tables
4 you get from direct to total impact, there are other ways.
5 Some are more simple. Some are more complicated.
6 But they all came back to the same notion of
7 measuring the ripples in the economy, and so I think there
8 would be no, I don't think you would get any serious
9 professional disagreement if you said you were going to use
10 input/output procedures to go from direct to total. I
11 don't see anybody saying that's wrong.
12 Q Well, isn't it true, Dr. Luke, if you use, and I
13 hate to use what seems to be an ambiguous term, but the
14 actual numbers reflecting acreage, yield, expenses, assets,
15 and liabilities, federal income tax feature, and forecast
16 you won't have an actual number, but if you had the actual
17 case-specific numbers for a given farm or a given area that
18 you are analyzing and you put those numbers in the place of
19 the assumptions that you would use based on the USDA
20 survey data and the rest, wouldn't that result in a more
21 accurate conclusion concerning the economic impact?
22 A Yes.
23 MR. GREEN: Your Honor, I believe he just asked
24 the same question, unless I'm asleep at the wheel.
25 HEARING OFFICER: Well, I thought it was the same
114
1 question, too, but I don't know if you interpreted it
2 differently.
3 A Well, let me see if it's the same answer, and
4 if it is I'll say, "No, sir, and here's why."
5 The USDA data is the actual data that was
6 collected at the farm level by trained personnel using a
7 structured sample that was stratified according to size
8 and which obtained responses from between 60 and 70 of the
9 growers in the EAA out of 133 total, so that it is the
10 actual data.
11 I mean, there's no way to say it is not the
12 actual data, and so I don't think that you would get
13 anything appreciably better.
14 I think that the projection of impacts in
15 not going to depend so much on the precise third decimal
16 place at which you start on the expenses or assets or
17 so forth. It's going to depend on the future projections
18 as to the financing mechanisms, as to sugar prices, as to
19 the costs of BMPs, and those things are not things you
20 can learn by looking at the historical data of Farmer Jones'
21 tax return to find out the future.
22 Q Isn't it true, Doctor, the answer you have just
23 given assumes that the information provided by the
24 individual farms during survey was accurate?
25 A It's my understanding from the document that
115
1 I showed you earlier that what they have indicated is that
2 this was done through audited survey of the books and
3 records of the respondents.
4 Q So the USDA sent out an auditor to check the
5 books and records?
6 A If you wanted to respond, it's my understanding
7 it's not you, the farmer, filled out a questionnaire,
8 but the USDA personnel went to your farm and sat down
9 with your books and records.
10 Q No further questions at this time.
11 MR. GREEN: Your Honor, just two or three
12 quick ones.
13 HEARING OFFICER: Okay, I think we're sort of
14 beating this issue into the ground now. I think we
15 need to get back to the bottom line. Thank you,
16 Dr. Luke.
17 MR. GREEN: Pardon me?
18 HEARING OFFICER: I mean, I'll give you an
19 opportunity, but I just think we're spending more
20 time on this and avoiding the main questions.
21 MR. GREEN: Your Honor, the Cooperative and
22 Wedgworth and Roth, petitioners in -3038 would like
23 to have, as you heard, Dr. Luke and/or others do
24 the economic analysis properly that Hazen and
25 Sawyer did the first step at, using the same central
116
1 approach and the same data base, same type
2 information, with the wrinkles that I won't pretend
3 to try to capture.
4 The second thing is I think Dr. Luke testified
5 he would take that information and develop more
6 community specific economic impacts, which he hasn't
7 done yet.
8 Neither of those exercises requires the use of
9 the information sought by the United States, nor was
10 that information utilized by the District when it
11 did step one with the Hazen and Sawyer report.
12 The reason we think it's relevant is two-fold.
13 Number one, our understanding of Florida water
14 quality standards, and on page 19, paragraph (n) of
15 our petition, is there are certain moderating provisions
16 that require regional type economic impact
17 assessment,s arguable would require those to be done,
18 to be looked at when you are ultimately developing
19 discharge limitations, as the SWIM plan does.
20 We think the type analysis is the same type that
21 DER and others do in rulemaking. These are general
22 estimates, the kid of thing Dr. Luke was talking
23 about he wants to do and the same type of thing the
24 District's Hazen and Sawyer report did.
25 The second reason we believe it's prevalent, we
117
1 think you will have policy choices at the end of the
2 line here of several alternatives, Your Honor, and
3 we think that each alternative has to be looked at in
4 the context of not only environmental remediation,
5 benefits, if you will, but also the cost to the people
6 involved in southeast Florida.
7 And again we're talking about a regional economic
8 impact analysis. Each alternative will have a
9 different price tag. We think that's exactly the
10 kind of information that Your Honor would want to see
11 and the information that the District has taken the
12 first step through developing, which we would like to
13 continue and do properly.
14 We don't think it's the kind of information that
15 one sustains in a punitive damages suit.
16 In effect the USA is suggesting in their motion
17 that for us to deal with the economic issues in the
18 case, which are contained in the Hazen and Sawyer
19 report, as I have described, we've either got to
20 produce all our individual financial documents,
21 even though they're not what we want to use, or else
22 drop our economic case, and I have described what
23 we're talking about
24 I think that's entirely inappropriate, and it
25 would be allowing an abuse of discovery, particularly
118
1 in light of the notion in Florida law that there
2 should be a degree of materiality of the information
3 sought. I hope we have demonstrated to Your Honor
4 that his information is entirely immaterial, and
5 we would urge you to grant our motion for protective
6 order.
7 MR. HOFFMAN: Could we argue for the aligned
8 people?
9 HEARING OFFICER: Yes, I was going to give you
10 an opportunity. Before I hear from you, Mr. Hoffman,
11 and Ms. Kavanaugh let me just say there are a couple
12 of issues that came to my mind in terms of this
13 discussion.
14 If I recall from the very first hearing we had
15 in this case there was a sort of a suggestion by one
16 of the petitioners, and I don't remember exactly who,
17 that part of this hearing should be scheduled in
18 Clewiston to hear direct testimony from the farmers
19 as to the impact the SWIM plan would have upon them.
20 It seems to me that if we're going to take that
21 sort of testimony then certainly that ought to be
22 open to discovery, you know, as to what that
23 testimony is going to be and to test the notions of
24 that financial impact.
25 Now if we're not going to have testimony that's
119
1 another matter, but I do recall someone said that
2 at the first hearing, and It would seem to open the
3 door to discovery of simply finding the impact.
4 Secondly, there was an indication in, it may have
5 been in the U. S. response or one of the documents,
6 one of the myriad of documents I read over the last
7 couple of days that there was going to be an attack
8 of the Hazen and Sawyer report along the lines that
9 the report did not use actual or accurate farm data,
10 and that there was, there was better information
11 available, or that there was, that the report was
12 inaccurate because it didn't include the actual
13 experiences of the farms out in the area.
14 If such an attack is coming then again I think
15 the respondents and those defending the claim should
16 have an opportunity to explore the nature of this
17 act, to explore what information is being contended
18 should have been better, and then to repeat that
19 information to determine whether in fact it is
20 better.
21 So again I don't know if that attack is going to
22 be made, but there certainly seems to be some
23 allusion to it in some of the documents I have seen.
24 MR. GREEN: With regard to those two issues,
25 they are not issues our clients would pursue. We do
120
1 not intend to offer up evidence on the impacts on
2 individuals of the type you describe, nor to second
3 guess the publicly available information that might be
4 used in the modeling efforts Dr. Luke will undertake.
5 HEARING OFFICER: Okay, and I would be interested
6 in hearing from petitioners, because, you know, if
7 that information is going to come, I do think it opens
8 the door to discovery into the nature of the testimony
9 as well as the background information, and that may
10 go to support or refute the testimony that was
11 offered.
12 MR. GREEN: Your Honor, just to be perfectly, to
13 make sure there are no misunderstandings, the
14 socioeconomic impact element, community impact element,
15 non-farm level, I think Dr. Luke testified requires
16 interviews and assessments of the local city
17 infrastructure and how losses of revenue will affect
18 that, and as Hazen and Sawyer pointed out that may
19 end up talking about a certain number of jobs
20 involved and that sort of thing, but again we would
21 consider that to be generic, general economic
22 impact assessment. We do not intend to bring on a
23 witness that Mom and Pop, to that point.
24 HEARING OFFICER: Or bring in 10 farmers and
25 say, "I'm going to lose six jobs," and "I'm going to
121
1 lose seven jobs," and try to accumulate those?
2 MR. GREEN: That's correct.
3 MR. GREEN: If you try to do that then you
4 are opening the door to discovery.
5 MR. GREEN: We are not doing that, Your Honor,
6 and we would amend our pleadings if required to
7 make that clear.
8 HEARING OFFICER: All right. There was also
9 some allegation in some of the documents that I have
10 reviewed, let me see if I can, well, there was an
11 allegation that the Hazen and Sawyer study may be
12 attacked because it did not have the information
13 from the actual farms or go out to each specific
14 farm, and from what I understand there was some
15 difficulty or there was some allegation that the Hazen
16 and Sawyer people had been denied the opportunity
17 to get information any more directly or any more
18 specifically from the individual farmers, and if the
19 attack from petitioners is going to be that you didn't
20 get any information but the response is, "You wouldn't
21 give us any information," then I don't want to hear
22 attacks along those lines, either, I guess is the
23 bottom line here.
24 MR. GREEN: Right. It won't be coming from us.
25 MR. WATTS-FITZGERALD: In our specific
122
1 case there is a specific instance, Mr. Hearing Officer,
2 a case in point. Florida Fruit and Vegetable
3 Association listed as a witness Ms. Wine, who is the
4 Chief Economic Officer. She's a CPA I guess who's
5 the accountant for South Bay Growers, listed on the
6 expert list. Her subject is impact of the SWIM plan,
7 etcetera.
8 Given her position it can only be of an economic
9 nature.
10 She has, and I probably should have passed
11 this question along to ask Dr. Luke, because he
12 indicated he reviewed tapes or was personally present
13 at Board meetings in front of the South Florida Water
14 Management District and especially where Ms. Johns
15 gave her report.
16 Two times before the Board at least Ms. Wine
17 said the numbers used by Hazen and Sawyer were no
18 good with regard to profitability, and they never
19 made $25 an acre or whatever, and I forget what numbers
20 she used, and that essentially was the extent of her
21 knowledge of the historic knowledge, which although
22 it's a member of the Fruit and Vegetable Association,
23 which is wholly owned by the U. S. Sugar Cane, and
24 all of this she put on record, although it was
25 not testimony, just a statement to the Board.
123
1 If in fact as we heard from Mr. Green one of
2 that is now going to be raised, then perhaps an
3 amendment to the witness list is appropriate. If it
4 is going to be raised by another petitioner it may be
5 appropriate to allow discovery against all of the
6 petitioners who are intertwined in a way I guess, a
7 weird word to use.
8 HEARING OFFICER: All right. Well, I'd like to
9 hear from the other petitioners with respect to those
10 issues I have raised and also generally the nature of
11 the case that they intend to present regarding the
12 practicability issues that are raised in the petitions
13 and also the economic issues, including those
14 matters Mr. Fitzgerald raised. Mr. Hoffman?
15 MR. HOFFMAN: May it please the Court, Ken
16 Hoffman, Fruit and Vegetable Association.
17 I think the comment by Mr. Watts-Fitzgerald is
18 indicative of part of the problem here.
19 A person makes a statement at a Board meeting of
20 the Water Management District, and it's brought up here
21 as though it means something, when it doesn't. I
22 think the question deals with what horse is before
23 the cart or is the cart before the horse.
24 The Hazen and Sawyer report, which you are now
25 into and have notes on all over the place, is not in
124
1 the SWIM plan. We have a document called the SWIM
2 plan, which is that thick (indicating), three volumes.
3 It never mentioned the Hazen and Sawyer report. I
4 don't know what it mentions about economic analysis,
5 but this report if it's done, and I'm not sure it's
6 done, there's a final report that has come out very
7 recently.
8 (WHEREUPON, DR. DE MEO LEFT THE HEARING ROOM.)
9 So the question is is that report under
10 challenge? It certainly wasn't under challenge by us,
11 because it wasn't in existence when we filed our
12 amended petition months ago. I don't think anybody
13 else has alleged it's under attack.
14 I think I have just been through this mediation
15 training, and now I have learned to ask questions and
16 never have a strong affirmative statement, but my
17 question is is it the federal government and the
18 District who's supposed to be the ones proposing
19 this, although we don't know, but is this plan now
20 going to be presented by the respondent, in this
21 case the District, as an affirmative proof of
22 something?
23 We believe the burden of proof is on the
24 District, but when will this come up? I mean, do
25 we have to defend against it or something?
125
1 HEARING OFFICER: Well, that raises a couple of
2 points. I'm not sure at this point that I have a
3 complete understanding as to how the Hazen and Sawyer
4 report fits within the SWIM plan and within the
5 context of this whole case. That's a different issue
6 that I sort of left aside.
7 I think that the League's response in some of the
8 issues they raise indicate in their view those issues
9 are not part of this case and may be set aside for
10 some other lucky person.
11 MR. HOFFMAN: I think there might be a potential
12 here for a ruling from the Hearing Officer to void,
13 you know, this document is quite thick and has all
14 these conclusions of fact as the conclusions of
15 what should be done.
16 (WHEREUPON, DR. LUKE LEFT THE HEARING ROOM.)
17 The fact that there are violations of water
18 quality, and then they say there are all these
19 things happening, and then they conclude as a fact
20 that there shall be, I mean there must be, there's some
21 kind of language that says there must be a result
22 of all this STAs, stormwater treatment areas, and
23 the land that they're going to use for the STAs is
24 farmland, and I don't know for sure yet what land they
25 are going to take, but I think as far as damage if
126
1 they took away the farmers' land for farming it's
2 damage.
3 We don't have to do, because the District
4 decides on its own to make assumptions in an economic
5 analysis which is being done by an outside consultant,
6 which in it deals with whether farmers are going to
7 go out of business or not, does that mean we have to
8 give them all our proprietary information when we
9 have not alleged anything about that and it's not in
10 the SWIM plan itself? That's what they're trying to
11 do here.
12 I would like to go just for a minute through
13 the Fruit and Vegetable Association situation. I've
14 gone through our petition these many hours that have
15 gone by, and I've tried to listen to these wonderful
16 arguments, but every now I faded off and read our
17 petition, and there's nothing in our petition where we
18 say we're gong to go broke, and there's nothing
19 in our petition that says that the actual, any actual
20 data will be better than Hazen and Sawyer, I mean,
21 because we don't know about that. The closest thing
22 I can find is we alleged if they take our land it's
23 going to hurt us. I don't know we need to give them
24 our payroll and compensation records to support that.
25 We allege that we, we question whether there
127
1 has been a cost-benefit study completed to assess the
2 value of the required STAs or to project the
3 percentage of the cost to the farmers. It has nothing
4 to do with our proprietary records.
5 Even the Corps of Engineers does cost-benefit
6 studies to find out whether to spend 500 million dollars
7 which is what this will cost to build these lakes
8 will result in cleaning up the water of the lakes.
9 That's the cost benefit, not whether we'll go out
10 of business or whether we're going, let me see, what
11 our stock options say, our audited financial
12 statements, our dividends for distribution. It's got
13 nothing to do with anything that's in our pleadings
14 or in the SWIM plan.
15 There are so many things running parallel to this
16 case. There's a SAGE Committee. There's the Hazen
17 and Sawyer report. There are all sorts of things
18 that are not part of the case. If they are going to
19 make it part of this case and say this is economically
20 a great thing, we ought to find out about it.
21 They have never done that, they being the
22 respondents.
23 If the state intends to provide adequacy of the
24 statements for some purpose then we'd like to know
25 about it, but they shouldn't be entitled to all of our
128
1 records as to what kind of employees we have, have
2 we ever supported a commodity program, well, all this
3 other material.
4 HEARING OFFICER: Well, Mr. Hoffman, let me just
5 say, and I understand we are still in the early
6 stages of discovery, etcetera, but if it's the
7 intent of the Fruit and Vegetable Association to
8 come into the final hearing in this case and argue
9 that, and I'm just taking hits totally off the wall
10 by way of example, that "Implementation of the best
11 management practices is going to result in such-and-such
12 a cost that will end up putting every one of our farms
13 out of business," then I think if that's the
14 nature of the testimony I think then discovery is
15 entitled to explore those areas to determine the
16 validity of that contention.
17 So I think what we're dealing with here is for
18 everyone to get a better understanding of exactly what
19 is the evidence that's going to be offered, because
20 I can see sitting here today a scenario where the
21 testimony presented, if it's all going to be similar
22 to what Dr. Luke was saying, that the issues of the
23 individual farms' financial condition is irrelevant.
24 On the other hand given the nature of some of
25 the allegations that were made in the original
129
1 petitions and some of the other documents that have
2 been filed, I think very clearly it opens the door
3 for discovery on the issues.
4 So I guess the bottom line out of all this is,
5 you know, that the broad nature of the petitions as
6 initially filed would seem to open the door to
7 discovery on some of these issues.
8 Now if the petitioners are willing to state on
9 the record or clarify at least at this point in
10 time those issues are not going to be pursued, then
11 I think we can limit discovery in that area. If it
12 turns out that during the course of discovery that
13 we see, you know, this is where we're going to have
14 a problem, because I think, you know, everybody has
15 to get their formulations and get together their
16 basic allegations so that we can pursue discovery in
17 a prompt and complete way, but anyway, go ahead.
18 I didn't mean to interrupt.
19 MR. HOFFMAN: I enjoy it when you give us your
20 thought process, because it helps us to respond
21 without wasting a lot of time on issues that you're
22 not concerned with
23 You know, this side issue of a farm that, a fruit
24 and vegetable farm, appearing before the Board and
25 commenting on the Hazen and Sawyer report is different.
130
1 You have to be responding to those things. It's not
2 part of this.
3 Ms. Wine would be able to tell the Hearing
4 Officer something that's straightforward. For instance,
5 what would it cost in dollars, for instance, to
6 implement something if that came up, you know, the
7 dollar amount of cost of a portion. She would have
8 that information or whatever.
9 But there's nothing I would think to call her
10 about that would go into the dispute on the Hazen and
11 Sawyer report. That's not anywhere alleged.
12 First of all let's start form the beginning.
13 You have the SWIM plan which does two or three things.
14 It says certain factual things and ends up saying,
15 "You need STAs."
16 Then we have pleadings. If anybody, I defy
17 anybody to look at my pleading, which I have not read
18 recently, and look at the SWIM plan and say based on
19 those that somehow we have gone into issues which would
20 allow discovery of our proprietary documentation of
21 our, who we hire, what programs we have supported,
22 commodity programs, our filings with the Securities
23 and Exchange Commission, and all this other information
24 back for five years on some of this. It's another
25 issue and burdensome even if it was relevant.
131
1 So I would defy anybody to find there is a
2 relevancy to the material half based on the pleadings
3 of the Fruit and Vegetable Association in its filing
4 or the SWIM plan.
5 I think that the problem again goes back to what
6 are we here for. I mean, is your decision when you
7 find the SWIM plan to be valid or invalid, either way,
8 let's say you find it valid, does that mean that you
9 determine that there are water quality violations in
10 the Everglades waters, violations of Class 3 waters?
11 Does that mean that you find there's a need for an
12 STA, so that when they go to condemn the land there's
13 not a need to determine it again?
14 I mean, this plan, you could determine so many
15 things, and it may be that we would like, we should
16 isolate out some things and have the order based on
17 motions that you are not by your rulings in this
18 case intending to eliminate forever issues.
19 For instance, the Hazen and Sawyer report. I
20 mean, that's not been raised anywhere. If they've
21 got a case I think we deserve to rebut it. But is
22 that an issue in this case?
23 I mean, I think there may be a way to parcel
24 out some of this, so we don't clutter up a SWIM plan
25 case with something that might be decided at a permit
132
1 stage or something. This SWIM plan according to the
2 Marjory Stoneman Douglas Act becomes part of the
3 District permit, I believe it is, and after that
4 District permit, which has now come out and which
5 has language in it about how, well, I can go on
6 forever in this case, but there are other permits that
7 go on from there.
8 Will we have a res judicata situation here on
9 all these issues in the future? That's the
10 question.
11 You know, other lawyers here, Ms. Kavanaugh and
12 I should probably comment, because they have lived
13 with it a lot longer than I have, but those are the
14 problems I have with it, and I just would object that
15 there was nothing relevant with respect to our
16 petition and our case to ask for all of this
17 proprietary information, and I think we could separate
18 out some issues as to all the parties and make
19 Mr. Green feel better also about his concerns.
20 He may be putting the cart before the horse. I
21 have not discussed this with him. But he seems to be
22 responding to the Hazen and Sawyer problem.
23 HEARING OFFICER: It does raise an interesting
24 point in terms of the response filed by the League.
25 Obviously it anticipates that the Hazen and Sawyer
133
1 report is not part of this SWIM plan challenge,
2 whereas the testimony presented by Mr. Green assumes
3 that it is part of the challenge, and I think that...
4 MR. GREEN: Well, Mr. Menton, again to be very
5 clear, I guess I disagree with my colleague,
6 Mr. Hoffman, as to our petition.
7 Again we think that the economic, the regional
8 economic impact analysis is relevant as to whether
9 the water quality standards have been properly applied.
10 We would intend to address that with the approach
11 Dr. Luke describes.
12 The other problem is whether the STAs are
13 practicable and in a regional sense can we look at
14 alternatives, not in an individual sense, but
15 individual testimony which we would agree we will
16 not put on. We will not bring it on.
17 HEARING OFFICER: Well, again I think we're
18 getting ahead of ourselves, because it does raise an
19 issue that I think will have to be addressed fairly
20 early on in this process, you know, long before we get
21 to hearing, and that is what is the Hazen and Sawyer
22 report, and how does it fit into this whole scheme of
23 things, and how does it fit into this particular
24 challenge?
25 It think we need to save that for another day,
134
1 but as I understand from what's been said today by
2 Mr. Green, even assuming it is part of this
3 proceeding, that the nature of the testimony will be
4 more generic in nature and is not going to be the,
5 the Hazen and Sawyer report is not going to be attacked
6 on the basis of "Well, this individual farmer, that
7 individual farmer has a different result, and
8 therefore the impact will be different than set
9 forth in the Hazen and Sawyer report, and therefore
10 the SWIM plan should be invalidated."
11 MR. GREEN: That's correct.
12 HEARING OFFICER: And as I understand from what
13 Mr. Hoffman just said, and correct me if I'm wrong,
14 although you are not competing at this point that the
15 Hazen and Sawyer report is in fact part of the SWIM
16 plan that we have before us now, at least as you
17 currently anticipate it it does not include a
18 presentation such as I just outlined where individual
19 farmers would come and testify, "Our impact is
20 different than set forth in the Hazen and Sawyer,
21 and therefore the plan should be invalidated."
22 MR. HOFFMAN: I never thought of doing that.
23 I think if I brought an individual farmer in all
24 I'd like to have him say is, you know, where his
25 farm is, and if they take away his land he can't farm.
135
1 There's all kind of harm that has nothing to do with
2 economic things, "I'm going to lose 'X' dollars and
3 go broke." It's not necessary part of the case.
4 HEARING OFFICER: Ms. Kavanaugh, I haven't
5 given you an opportunity to comment yet.
6 MS. KAVANAUGH: Thank you. Obviously our
7 three petitioners, the League, New Hope, and the U. S.
8 Sugar, as we have indicated in our motion for protective
9 order do not agree that the economic impact is
10 ripe for adjudication in this hearing. We described
11 that in our motion and stand by it.
12 I would like to add two addenda to the motion,
13 transcript excerpts that I just got. One is the
14 deposition testimony yesterday of Mr. Rhodes, who is
15 the Everglades Project Manager, and the other is
16 Mr. Rhodes' presentation to the District on
17 September 10th, and I'm not going to argue these,
18 because you indicated you're not hearing arguments,
19 but I would like to submit these as additional
20 exhibits to our motion for protective order, because...
21 HEARING OFFICER: Probably the best way to do it
22 is file a notice, so it goes to the Clerk's Office
23 and they docket it.
24 Sometimes I forget to file those.
25 MS. KAVANAUGH: It basically underscores the
136
1 fact that in fact the District doesn't
2 contemplate doing, completing its economic impact
3 until this proceeding is over with and it has the
4 optimal SWIM plan, and it has been our belief in
5 this proceeding that this proceeding would in fact
6 result in fact findings as to the cause, impacts, and
7 whether the proposed standards, for example, are
8 appropriate based on the findings, the factual
9 findings, the material factual findings and
10 recommendation as to whether the STAs are in fact
11 practicable, and as we indicated in our motion how
12 much the STAs are really going to cost and are the
13 funding assumptions used reasonable in light of other
14 available alternatives that we intend to present.
15 We do concur with Coop and I guess with
16 Mr. Hoffman's clients in one respect, and that is
17 that once the economic analysis does become the issue,
18 if it is in this proceeding or some other proceeding,
19 that it's the regional data. We are not going to
20 question the information base so much as hot it is
21 used.
22 Hazen and Sawyer used generic information, and
23 I think Dr. Luke was indicating he probably says
24 they haven't used it all. They just plugged in
25 certain factors.
137
1 We do not intend to present evidence or to
2 raise as an issue in the proceeding that we are going
3 to be put out of business if this SWIM plan is
4 implemented. We will not do that.
5 As far as the Clewiston hearing, we never, we
6 did suggest that. I was the guilty party. That was
7 more as a matter of having the farmers say, "I'll have
8 to put these pumps in or that pump," addressing the
9 issue in the SWIM plan, but not coming in and saying,
10 "And I won't be able to farm," and we don't intend
11 to do that now, frankly.
12 So I guess in conclusion we stand by your
13 position it's not ripe in this proceeding, except
14 as practicability is raised by the SWIM Act itself,
15 and that if it is relevant, however, the information
16 specifically requested in the United States' production
17 of documents request is not material, is irrelevant,
18 and is, should be not procured under any circumstances,
19 that the type of information is what would be used,
20 what is being used and what should be used. That's
21 our presentation.
22 HEARING OFFICER: Okay. Mr. Nettleton?
23 MR. NETTLETON: Mr. Hearing Officer, if I could
24 go first, and then if I could be excused to change
25 my flight. I'll be very brief.
138
1 Everyone talks about the United States request.
2 I'd like to clear up for the record the District has
3 joined in the request, and it's our request as well.
4 We also as far as I know, I have still not
5 received the League's papers they served on Friday,
6 so I don't know what they said in there.
7 What Ms. Kavanaugh has represented today is
8 they have amended their petition, and what you have
9 indicated is to withdraw anything regarding the
10 economic issues.
11 I intend to agree essentially to the bottom line,
12 that the economic impact of the SWIM plan is irrelevant
13 to this procedure overall. Nevertheless, it has been
14 alleged in the petitions, and I have some trouble
15 with the fact that the petitioners come in here, and
16 whenever they come into a discovery bind that they
17 don't like they want to somehow amend their petition
18 to work around the discovery.
19 It's okay if they want to dismiss a particular
20 allegation, but I'm not aware as the League has
21 represented in its new, amended petition there is a
22 standing order they can amend to restate their
23 claims whenever they want to.
24 I further disagree, and I have only had a
25 chance, I just got the amended petition yesterday,
139
1 but it appears, and I think Mr. Saxe will go into
2 more detail, that there are some issues relating to
3 the economic impact.
4 As far as then what we're planning to do with the
5 Hazen and Sawyer report in this proceeding, I don't
6 think it has any direct relevancy, except to the
7 fact they have raised the economic issues.
8 In that sense as we stated on our witness list
9 we have named Grace Johns of Hazen and Sawyer as
10 our economic expert to deal with the issues they
11 have raised in their petition. She is also the one
12 who is head of the group that prepared that report,
13 so it's likely that her opinions relating to the
14 economic impact will be somewhat consistent with that
15 report.
16 Nevertheless, she did not have access to all
17 the specific information relating to the farm
18 information which we think would render either
19 support or as they say undercut the assumptions that
20 have been assumed.
21 If I could just...
22 HEARING OFFICER: Well, given the nature of the
23 testimony that the petitioners have indicated here
24 today they intend to offer, why are the employment
25 records and compensation records and loan
140
1 documentation, why is that sort of information
2 relevant?
3 MR. NETTLETON: Mr. Hearing Officer, first of
4 all it is somewhat difficult to pin down exactly what
5 the issues are. We know they have a shadow issue
6 about what the economic issue is going to be, and they
7 keep changing every time a discovery request or
8 argument is made.
9 This is not carved in stone, and maybe next time
10 we'll hear some different testimony from Dr. Luke.
11 I mean, there are five other experts listed. We
12 only heard one version today of what one petitioner
13 is planning to present.
14 I just think it's clearly relevant to the
15 overall, the individual economic or financial
16 materials that have been requested all relate to the
17 underlying assumptions that have been made regarding
18 the impact on these particular petitioners as well as
19 the region in general, and assuming it's relevant to
20 the proceeding, which again I'm not conceding, but
21 at this point it is the issue, then we should be
22 able to do discovery and get into those areas.
23 One other thing. Ms. Kavanaugh mentioned
24 Mr. Rhodes' comments. My understanding of his
25 comments did not have to do with the present SWIM plan,
141
1 which is what is at issue here, but with alternatives
2 to STAs and various things that are being proposed by
3 SAGE or the petitioners or whoever comes in and
4 makes proposals.
5 The SWIM plan is an ongoing process, as it
6 recognizes in the document itself, and the research is
7 ongoing as things are developed and science and new
8 alternatives come in. Obviously there will be
9 re-evaluations.
10 That has nothing to do with, you know, it's going
11 to take nine more months to do an economic impact
12 analysis on some other proposal, which has nothing to
13 do with the validity of the present SWIM plan and
14 the proposals that are in the SWIM plan and the
15 economic estimates of the impact that are set forth
16 in the SWIM plan.
17 So whatever he said is irrelevant to what's at
18 issue here, if anything is at issue regarding the
19 economic impact of the SWIM plan itself.
20 Could I be excused?
21 HEARING OFFICER: Sure.
22 (WHEREUPON, MR. NETTLETON LEFT THE HEARING ROOM.)
23 MR. SAXE: I'm not sure how helpful any of
24 this has been today. Dr. Luke's testimony seemed to
25 be a long opinion about Dr. Luke's opinion on the
142
1 Hazen and Sawyer work. I don't hear any of the
2 petitioners really stipulating that their case on
3 economic impacts will be limited to the Hazen and
4 Sawyer work, and in reviewing the petitions, including
5 the second amended petition filed by the League late
6 last week, I find a number of paragraphs of allegations
7 of disputes that at least leave open the possibility
8 that any or all of these petitions will challenge the
9 SWIM plan or the restoration program provided in the
10 SWIM plan, based on allegations of economic impact
11 found in the implementation of that program.
12 I have heard three different stories from
13 Mr. Hoffman and Mr. Green and Ms. Kavanaugh about
14 whether or not and to what extent economic impact
15 is or may be an issue and at what point, it is ripe,
16 it is not ripe, it's only going to be generic, it
17 won't be individual.
18 I think the ultimate goal is correctly stated
19 as identifying just what may be potentially an issue
20 in this proceeding, because that has to form the
21 basis for determining whether or not the United
22 States has a right to discover this material as
23 relevant, non-privileged material.
24 But until we define that we are left to some
25 extent at a disadvantage in rebutting a host of
143
1 different and not particularly clear statements
2 about what those issues are going to firm up to be.
3 I just...
4 HEARING OFFICER: I do think the whole process
5 today has been helpful, because at least it has in my
6 mind more clearly delineated the nature of some of
7 the proceedings that are going to be involved, and
8 certainly if you, if this issue never comes up again
9 and we never have to address it, if I was to conclude
10 as a result of what's gone on today that this
11 information need not be discoverable at this point in
12 time, then I will hold the petitioners to that at
13 the hearing if they suddenly come up with information
14 from the individual farms or information to refute
15 the Hazen and Sawyer report based on actual
16 farm data that contravenes assumptions that were in
17 here. I'm going to hold them to the early
18 representation that I had today.
19 (WHEREUPON, MR. NETTLETON ENTERED THE HEARING
20 ROOM.)
21 To that extent I think it has been very useful.
22 MR. SAXE: With all due respect, Mr. Hearing
23 Officer, I agree in theory, but the problem is
24 there are slippery semantics involved here, and
25 it's quite likely that a limiting construction now
144
1 that seems to be unambiguous on its face will not
2 serve to resolve whether or not specific niches of
3 issues were somehow left intact for future purposes
4 for adjudication.
5 HEARING OFFICER: Kind of like the August 21st
6 hearing.
7 MR. SAXE: The point is in the meantime we're
8 proceeding on an expedited schedule, and it's
9 necessary to undertake discovery with dispatch and
10 with zeal in order to prepare this case.
11 Mr. Hearing Officer, you stated the question at
12 one point as do petitioners intend to challenge the
13 Hazen and Sawyer assumptions as not reflective of
14 the EAA. I thought that was a very useful way of
15 framing one aspect of the issues, but it occurred to
16 me as you were framing the question and receiving
17 responses that sounded somewhat reassuring in
18 different ways and to different degrees to the
19 petitioners that it does not exclude the possibility
20 that the petitioners are going to launch their own
21 arguments concerning economic impact in an enormous
22 sense, burdens that somehow are actionable under
23 law and render the SWIM plan or the restoration
24 program defective because of those economic
25 burdens. It does not leave us any closer to
145
1 understanding whether or not any such claim
2 independent of the Hazen and Sawyer analysis might
3 be made.
4 HEARING OFFICER: Again I can see a situation
5 where those arguments could be made, but without being
6 or being made in a more generic sense in terms of,
7 you know the SWIM plan argues that the best
8 management practiced are going to cost, you know $50
9 per farm, and in actuality they are going to cost
10 $50,000 per farm, and that could very well be a
11 relevant area of inquiry without the need to have to
12 go to each individual farm and find out what their
13 income tax statement shows, what their compensation
14 to various employees, etcetera, are.
15 MR. SAXE: But again with all due respect is it
16 not the case that if the further claim is made that
17 given the level of cost, absolute value, absolute
18 level of cost associated with the given aspects of
19 the restoration program that the program is
20 defective because that cost will entail certain
21 impacts in the community, economic impacts in the
22 community, lost jobs, lost earnings?
23 Should those claims remain intact in this
24 proceeding, the United States needs to be able to
25 defend against them.
146
1 Right now the discussion has focused on the
2 Hazen and Sawyer work, because that is an avenue
3 through which the District gratuitously undertook to
4 assess the economic impact question, but that does
5 not necessarily exhaust the universe of how those
6 issues can come up, and...
7 HEARING OFFICER: Well, but even if it's broken
8 down, as Dr. Luke suggested, from beyond just a
9 county-wide level to a community-wide level, does
10 that necessarily require an examination of individual
11 businesses within the community in order to make
12 that determination? Why should it just be limited to
13 farms? Why not go out and look at the hotel industry
14 and the restaurant industry?
15 MR. SAXE: In fact everything is looked at
16 through the means that Dr. Luke alluded to and the
17 District and the Hazen and Sawyer project addressed.
18 There are three species of impact, direct,
19 indirect, and induced. The direct is on farm.
20 The United States discovery is directly relevant to
21 the direct impact question on farms to the extent,
22 and the United States does not concede the legal
23 relevance of such matters, or let me restate that,
24 does not concede that any claims petitioners might
25 be making based on direct impacts are legally
147
1 cognizable.
2 To the extent they're putting an issue in the
3 petition and bringing those claims though, the
4 discovery we seek is relevant to the direct
5 impacts, but the economic impact assessment process
6 builds a picture of indirect and induced impacts
7 community-wide, based on direct impacts. That's
8 the predicate from which everything states.
9 To make I think an important point, Mr. Green
10 made the point that economic impact assessment is
11 region-wide, not based on individual impacts. In fact,
12 were we to have the ability to develop that factual
13 question, because it is a factual question of
14 economic impact assessment, we would show that
15 economic impact assessment community-wide is a function
16 of the aggregate of individual impacts, and the tools
17 and the means by which those community-wide numbers
18 are generated ultimately do reduce to the questions
19 of individual impacts.
20 Now the reference to secondary source information,
21 why do we need discovery of real, live data, on-arm
22 data, if in fact there is a source of secondary
23 aggregate information that's publicly available is
24 highly problematic and in one sense misses the point.
25 I think the petitioners want to clearly make
148
1 general statements about economic impacts which will
2 as they know of necessity be extrapolated as
3 applying on an individual level to the farms and
4 agricultural enterprises and stores and hotels
5 that are at issue in the community, but if we
6 limit the critique to a method of analysis
7 only we're faced with a situation where by excluding
8 the discovery of individual information we lose our
9 ability to show that even if the League or the
10 Coop or Fruit and Vegetable can prove up a technical
11 error in one generic assumption underlying the Hazen
12 and Sawyer work, for instance, perhaps it's harmless
13 error. Perhaps inspection of the actual source data
14 from which those generic assumption come would reveal,
15 although the assumption seem discordant with
16 certain other generic factors that might be induced,
17 in fact it is an accurate reflection of the real
18 debt structure on the farms in the EAA.
19 I don't think that Occan's razor will successfully
20 separate the generic from the specific when it comes
21 to challenges based on economic impacts if and to the
22 extent those challenges are still a potential issue
23 in this case, and I agree that's got to be the
24 question that has to be determined to find if the
25 U. S. should have the discovery it seeks in the motion.
149
1 I just would like to take a brief opportunity to
2 go through the petitions briefly, including the
33 League's most recent second amended petition, and
4 show where and to what extent it appears they are
5 at least leaving open the possibility that challenges
6 will be made to the restoration program based on
7 economic impact or practicability.
8 (WHEREUPON, DR. DAVIS LEFT THE HEARING ROOM.)
9 All three petitioners, including Fruit and
10 Vegetable, have challenged cost-benefit justification.
11 Fruit and Vegetable makes the allegation in
12 paragraph 19, 16(b), to its petition, the Coop makes
13 the allegation in paragraph 13(c) of its petition,
14 and the League in Paragraphs 67(a)(j), 67(r), and
15 69(h).
16 In addition...
17 HEARING OFFICER: Isn't that cost-benefit analysis,
18 as Mr. Hoffman pointed out a minute ago, isn't that
19 at least, I guess it could be more specific than he
20 described it, but the way he just described it and the
21 way that I would hold him to if they are going to
22 refuse to produce that information would be that the
23 cost-benefit analysis that he's talking about is
24 whether to spend the money that it takes to do
25 the condemnation to establish the STAs is worth it.
150
1 basically, not necessarily, you know, from an
2 individual farm perspective, but from an overall
3 perspective.
4 MR. SAXE: Assuming for a moment that that is
5 a cognizable claim in this proceeding, as counsel for
6 the District has indicated, the respondents,
7 respondent/intervenors don't concede that, but
8 assuming it is relevant or it's cognizable, it
9 seems to me that you can't talk about cost-benefit
10 justification without basically putting a price tag
11 on both sides of the ledger sheet.
12 Now that is to some extent something at least
13 with respect to the cost side that the District has
14 endeavored to do through the Hazen and Sawyer report.
15 That process is based on assumptions.
16 If the petitioners are going to challenge those
17 bottom line numbers and says, "Your numbers are
18 incorrect, your costs are underblown, your benefits
19 are overblown," there's a question what the United
20 States needs to be able to rehabilitate the conclusions
21 that the District has drawn, and my point is that
22 the case law establishes where cost impacts are put
23 in issue, and I note that the Cooper case cited along
24 with the Tennant case in support of that proposition
25 earlier is not a punitive damage case at all.
151
1 The law establishes that where those matters are
2 put in issue, the United States is not relegated to
3 foregoing a whole realm of potentially relevant material
4 to show that assumptions are correct, even if there
5 appear to be discrepancies at a generic level. That's
6 the key problem with that particular cost benefit,
7 Pandora's box.
8 HEARING OFFICER: What assumption are you saying,
9 are you referring to within the context of this case?
10 I'm not quite sure how your comments fit.
11 MR. SAXE: The assumptions that underlie the
12 District's conclusions about what the costs of the
13 restoration program are, number one, what the benefits
14 of that program are, and number two, whether the
15 benefits outweigh the costs.
16 HEARING OFFICER: But again I don't see how that
17 at that macro level, how that necessarily requires
18 an examination of the individual farmers at the micro
19 level.
20 MR. SAXE: I'll give you an example, and it's a
21 very problematic enterprise, because we're dealing
22 with very complex factual questions without the
23 assistance of well developed testimony and evidence
24 on a hypothetical basis.
25 HEARING OFFICER: That's a good point.
152
1 MR. SAXE: I can give you one example, The
2 Hazen and Sawyer report makes assumptions about
3 debt. It was a subject of some colloquy with
4 Dr. Luke. The assumption was based on assumed low
5 or low level of long-term debt for particular kinds of
6 farm enterprises.
7 The assumption was based on a lack of primary
8 data showing otherwise, number one, because that's
9 alluded to earlier, and the petitioners rejected in
10 treaties to provide data concerning the debt,
11 number one, and number two, the returns to land
12 are so high for sugar farming, for example, that
13 it was deemed a reasonable assumption to assume
14 zero long-term debt with respect to those operations.
15 Now to the extent the petitioners would challenge
16 that assumption and show that other generic sources
17 of data which ultimately drive their source from
18 the first-person reports, not under oath, of the
19 individual farmers in the EAA and seek to show, for
20 instance, a question in a methodological sense or
21 a generic sense about that assumption, we believe
22 that a showing of specific live, actual discovery
23 concerning the debt or absent of debt on those
24 farms would serve, would certainly be relevant to
25 the question of whether the assumption ultimately was
153
1 correct.
2 MR. NETTLETON: Mr. Hearing Officer, I don't
3 want to break the point, but if I could make two
4 points.
5 HEARING OFFICER: Please do.
6 MR. NETTLETON: One is with regard to what
7 Mr. Saxe is saying, on page eight of the report that
8 Dr. Luke identified today under number five, treatment
9 of debt, he said, "The economic impacts report,"
10 talking about the Hazen and Sawyer report, "notes
11 that information was not available on specific farms
12 and mills in the EAA from public or private sources.
13 This led to the adoption of a model farm technique
14 to approximate impacts by class of farm. However,
15 Hazen and Sawyer then assume none of these models
16 had any debt."
17 Then he goes on, "These assumptions are incorrect
18 and unnecessary."
19 So he's in essence criticizing the fact that we
20 have used a model because we couldn't get to the
21 specific farms and mills in the EAA for the private
22 data, which is true, because when you're doing an
23 economic impact study, as he mentioned, normally you
24 don't have access to discovery in litigation, but
25 now there's litigation going on, and they've brought
154
1 the issues up, and there is now a direct route to
2 the specific data that could support or even undercut,
3 depending on what the data is, what Hazen and
4 Sawyer have said.
5 The second point I'd like to say is, and it was
6 Mr. Saxe's threshold argument before Dr. Luke started
7 reading from one of the Supreme Court cases, and I
8 can't recall which one it was, but it expressly
9 stated that where the financial information is at issue
10 that were not relegated to the, and I went through
11 with Dr. Luke, the whole reason I went through all
12 this material and where the sources were was and
13 what he's criticizing for not using what we should
14 have used and all that, all of that is based upon
15 secondary compilation of core data that comes from
16 the farms, and the case that Mr. Saxe cited and
17 read from specifically holds that in discovery we
18 are not relegated to secondary compilations of data,
19 and we can go directly to the source to test the
20 accuracy of that data.
21 HEARING OFFICER: Yes, but the secondary
22 information in this particular case was, it's not
23 something the petitioners themselves are relying on.
24 They're not the ones who have brought this into the
25 case. Now if they're going to, you know, they may,
155
1 you know, attach the use of it by Dr. Luke if in fact
2 it does come in, but they're not ones who have put
3 the secondary information before you.
4 MR. NETTLETON: I certainly haven't put it
5 before anybody.
6 MR. GREEN: If I could clarify a point, I think
7 Dr. Luke's testimony if you'll look at the transcript
8 says that information he considers to be primary
9 information. It is collected through the United
10 States Department of Agriculture audits, pursuant to
11 federal law. It is relied upon by people in his
12 profession to do these type regional analysis, and
13 the interesting thing is the FLIPSIM model was
14 developed by Congress, by the U. S. D. A. grants
15 to Texas A&M, and the model statistic is using
16 federal data, and now the government is sort of
17 saying, "Well, we don't trust our own data," and using
18 that as a guise to get individual model information,
19 which is really irrelevant to the regional analysis
20 we're talking about.
21 MR. NETTLETON: We're not saying that at all.
22 HEARING OFFICER: We're going on and on, and we
23 have another big issue we need to deal with. Let me
24 just say at this point I think the first question we
25 need to deal with is what is the role of all of these
156
1 economic issues in this case, including the Hazen
2 and Sawyer report, and then secondly I think the
3 allegations at least as I have heard them verbally
4 presented by the petitioners today have been narrowed
5 significantly from the broad based allegations that
6 were contained in the initial pleadings, and
7 certainly I would intend to hold them to that if we go
8 to hearing and the financial data has not been
9 produced.
10 But I'm not going to order production of the
11 financial data at this time. At some point down the
12 line if it becomes relevant either as a result of
13 additional discovery or other matters that come to
14 light, we can revisit that question, but I think at
15 this particular time it has not been a showing that that
16 information which I think is certainly sensitive, if
17 not privileged, deserves to be closely guarded, and
18 I don't think that the allegation s of this case as
19 I currently understand them require production of
20 those documents.
21 I think, you know, I've head a lot today, and
22 we can go on and on and argue about this forever and
23 ever, but I don't think at this point in time it's
24 necessary to compel the production of the data.
25 As I indicated, if discovery reveals some
157
1 additional information, bring it to light, and
2 we'll take it up if we have to.
3 So that leaves us with the one other issue,
4 which is the access issue, and I didn't mean to cut
5 everybody off, but it seems we could go on about
6 this forever. If you want to state something on the
7 record, I'll give you an opportunity.
8 Ms. Ponzoli, you're about ready to jump out of
9 your chair.
10 MS. PONZOLI: I guess I would like to see them
11 enter written stipulations as to the limitations of
12 their economic presentations. I think that would
13 offer an enormous level of comfort to the
14 respondents.
15 HEARING OFFICER: Well, I think there's two
16 issues there. The first is to determine what is the
17 economic case that is going to be at issue in the
18 proceeding, so maybe the first thing we need to do is
19 to address the role of the Hazen and Sawyer study
20 and what its role is in this case. Do we address it?
21 I mean, I have looked at the portion of the SWIM
22 plan that Mr. Green gave me earlier, and I noticed
23 before the references to the Hazen and Sawyer report
24 and the economic study that was going to come, and
25 to be honest with you I haven't sat down and really
158
1 thought through where the evidence, if it directly
2 challenges it is pertinent to the order that I'm
3 going to have to write at the conclusion of this
4 case, and as I understand what the League is saying
5 in their petition that they filed Friday that you got
6 yesterday, they're saying that it's not, and Mr. Green
7 I think is not quite saying that it is but is
8 addressing it more in terms of the water quality
9 issues.
10 To be honest with you, I haven't looked at it
11 and haven't really thought about it to make a final
12 determination, so as much for that reason as anything
13 I think it's premature to order the production of
14 sensitive financial records.
15 So maybe what we need to do first is for each
16 party to confer and see if you can reach agreement.
17 MS. PONZOLI: We can't even talk about this
18 one, Mr. Hearing Officer. I have to tell you...
19 HEARING OFFICER: Well, why don't we just say
20 we can maybe set this down for hearing at some time
21 as the burden of proof case and have both of the
22 parties address that and specifically lay out
23 their positions on that, and then we'll take it from
24 there.
25 In terms of the stipulation regarding the, now
159
1 that we have talked about, let's first resolve that
2 as we go through this discovery.
3 I have heard today and have embedded in my mind
4 the position that the petitioners have advanced, and
5 if the financial information on the individual
6 farms is never produced during the course of this
7 proceeding, I'm going to certainly keep that in mind
8 as testimony is offered at the final hearing, and
9 I'll tell you up front I will exclude any testimony
10 that I feel is based on the financial data of
11 individual farmers that has not been produced in
12 the United States. Everybody is on notice of hat
13 right up front, and I think that's the best I can do
14 right now.
15 After we deal with the economic issue and
16 determine what the nature of that is, then we will
17 have to do some discovery, and I think during that
18 discovery we may be able to fully understand what
19 testimony is going to be offered, and if there's
20 any problem to try to address that.
21 MS. PONZOLI: That seems fair.
22 MR. GREEN: Your Honor, just for clarification,
23 Ms. Ponzoli has filed a notice of taking deposition
24 duces tecum which I believe you would agree, I assume,
25 now would not be appropriate in light of this. It
160
1 asks for financial information.
2 MS. PONZOLI: Only as to those portions,
3 Mr. Hearing Officer, that duplicated our request
4 for production from Wedgworth Farms.
5 The entire notice duces tecum does not go to
6 those same issues.
7 As to financial issues, Mr. Green, presently
8 I think the Hearing Officer has indicated that we are
9 not entitled to those documents. I don't think that
10 precludes me from asking Mr. Edgeworth questions
11 about the type of case or the type of testimony he
12 would anticipate at trial on the financial issues.
13 That might actually open up the opportunity for me
14 to reapproach the Hearing Officer with a request
15 for further documentation.
16 MR. GREEN: That's fine. I understand. I
17 just wanted to clarify.
18 MS. PONZOLI: Thank you.
19 MR. NETTLETON: With all due respect to what's
20 embedded in our mind from the hearing, it would seem
21 in order to avoid putting the cart before the horse
22 that if we got something along the lines of
23 Ms. Ponzoli's suggestion, some kind of indication
24 from them of precisely what the economic issues
25 are that they're planning to raise, that would permit
161
1 us then to go through this discovery on the precise
2 issues instead of kind of shooting in the dark on what
3 they mean by practicable and all that sort of stuff.
4 This would allow us to do the direct discovery,
5 and we can deal with the relevancy of that at the
6 next hearing, as you suggested, as opposed to, I mean,
7 to me this is all sort of shadow issues as to what
8 they're going to present.
9 MS. PONZOLI: That is our feeling. I'll be
10 very honest with you. I can see from your perspective
11 you're sitting us there thinking, "They have honed
12 this right down to the bone," and you understand what
13 they're going to do.
14 We're all sitting over here, as you said, looking
15 like we're going to fall off our chairs or jump out
16 of our chairs, because we hear all these ambiguities
17 and all these things that are not clear to us.
18 If they would brief the case that they anticipate
19 putting on, then we could say, "Well, that's fine,
20 but we're entitled to something specific on this,"
21 or, "All right, fine, we'll all do some regional
22 data modeling, and we'll all put on a modeler at the
23 final hearing, and you'll pick the one you like best."
24 MR. GREEN: May I try an alternative to
25 Ms. Ponzoli's suggestion? Could we submit to you
162
1 within a reasonable time, 10 days or two weeks, a
2 proposed order which deals with these issues from
3 our perspective, and then have the parties react
4 to that in a timely way to assist you in ruling?
5 HEARING OFFICER: Why don't we do that. Again
6 we're getting back to the cart before the horse
7 issue. It seems to me though the first and fundamental
8 question is what is the role of the economic issues
9 in this SWIM plan challenge. To me that's the fist
10 think you have to address. If we determine that the
11 Hazen and Sawyer report is not part of this case,
12 then certainly it eliminates a broad range of
13 potential areas that we need to get into.
14 MR. NETTLETON: If they tell us that up front,
15 then we don't have to deal with it.
16 MS. PONZOLI: If they would commit in writing,
17 not some words, but in writing, if they'll say,
18 "We're not doing this," then fine. It's okay.
19 MR. GREEN: That's not what he said.
20 MS. KAVANAUGH: We stand on our motion for
21 protective order and what we think are the issues
22 in the case, and I don't intend to submit anything
23 else that I can think of, unless somebody tells me we
24 need to. Those are what we think are the economic
25
163
1 issues.
2 HEARING OFFICER: I think again you have not
3 had an opportunity to fully review...
4 MR. NETTLETON: I haven't seen it.
5 HEARING OFFICER: ...the motion that they filed.
6 Mr. Green, why don't you take a stab at whatever
7 you want to do and submit that in 10 days, and then
8 we can, you know, as I indicated, I think the
9 parties should both brief the economic issues as
10 part of, within the time frame we have talked about,
11 the burden of proof, and hopefully that will simplify
12 and slowly whittle this down piece by piece.
13 MR. WATTS-FITZGERALD: Mr. Hearing Officer,
14 you'd be anticipating addressing that at the hearing
15 on the 30th of October then?
16 HEARING OFFICER: Now there was some discussion
17 about the burden of proof as a result of the
18 hurricane, whether that was being pushed back.
19 MR. WATTS-FITZGERALD: The briefing schedule
20 was pushed, so we could not have made the hearing
21 date. It would have been today. The replies are
22 not yet due, so...
23 MR. HOFFMAN: October 5th is the burden of
24 proof memo.
25 MS. KAVANAUGH: You all intended to hear it
164
1 at the public hearing in October. Just the briefing
2 was moved.
3 MR. HOFFMAN: Could somebody explain what happens
4 now so far as what we're supposed to be briefing on,
5 you said in addition to the burden of proof, which would
6 be only five or six days from now, you wanted some
7 comments on what are the economic issues?
8 HEARING OFFICER: Well, I guess there has been
9 some questions raised today as to the Hazen and Sawyer
10 report and the economic impact issues as to whether
11 they are in fact within the scope of this proceeding.
12 The SWIM plan as it was adopted and sent to me
13 did not include the Hazen and Sawyer report. I have
14 not to this day, I saw a little copy floating around
15 here.
16 But I haven't seen the Hazen and Sawyer report.
17 It's not to my knowledge in the files of the
18 Division of Administrative Hearings.
19 But obviously there is a contemplation in the
20 SWIM plan that an economic impact assessment was going
21 to be prepared, and I think there is even a reference
22 in the SWIM plan that it will be incorporated into the
23 SWIM plan.
24 Now I don't remember the exact language. Now I
25 don't know if that means that that places it at issue
165
1 to be challenged and whether I'm going to be
2 required to make findings of fact and conclusions of
3 law regarding the Hazen and Sawyer report, you know.
4 That's the issue that I'm looking for some input
5 from the parties on, as to what their position is on
6 that.
7 As I understand it from the reviewing of the
8 League's motion, their position is it's not part of
9 what I should be considering at this point, and if
10 it's not part of what I should be considering now
11 I don't know when it's to be considered, by whom,
12 or where, you know. I mean, that's not addressed.
13 MS. KAVANAUGH: And you don't care.
14 HEARING OFFICER: Well, I do care, though.
15 MS. KAVANAUGH: Yes.
16 HEARING OFFICER: And I think it's something,
17 you know, I'm not going to send off into the night to
18 be addressed by nobody.
19 MS. KAVANAUGH: We'd like to address that in
20 further briefing, as well as the whole question on
21 the data base, if you assume it is brought in, if
22 we're not correct, whether or not the specificity
23 that's currently being sought is the appropriate
24 data base, so we would offer to do that.
25 HEARING OFFICER: You lost me on that one.
166
1 MR. GREEN: We passed that issue.
2 MS. KAVANAUGH: As I said, we'll stand by what
3 we said. We'll offer more briefing on the issue.
4 MR. HOFFMAN: The issue is that Hazen and Sawyer
5 report, not the world. We are down to the Hazen and
6 Sawyer report...
7 HEARING OFFICER: Right, yes. I think we ought
8 to limit it to the issue of the Hazen and Sawyer
9 report.
10 If it's, the Hazen and Sawyer report is not part
11 of this case, if for example the conclusion is that
12 Hazen and Sawyer is not part of the SWIM plan, then
13 it's not to be considered in this challenge, then I
14 think it really removes a lot of the economic
15 impact issues from the whole proceeding, at least as
16 I have reviewed the plan.
17 There are really no, I think that's the most
18 specific reference to economic impact. Obviously
19 there are other conclusions in terms of the BMPs,
20 but in terms of a regional macro sense, that's where
21 the assessment is.
22 MR. NETTLETON: Mr. Hearing Officer, just to
23 clarify, my understanding is what they're challenging
24 is the economic impact. The Hazen and Sawyer report
25 just happens to be a report that the District
167
1 requested an expert to prepare relating to that
2 issue. It's not obviously in and of itself the
3 issue. It's not, it's the economic impact that's the
4 issue.
5 MR. SAXE: Cost benefit, practicability,
6 feasibility, reasonableness, but no where does it
7 say Hazen and Sawyer.
8 HEARING OFFICER: Hazen and Sawyer wasn't part
9 of the plan at the time that it was adopted by the
10 Water Management District.
11 MR. NETTLETON: I'd just like to verify on
12 the briefing we're going to be doing, it's
13 essentially our position and I believe it will be in
14 our briefs that the entire issue of economic impact,
15 whether you want to deal with the Hazen and Sawyer or
16 anybody else's testimony concerning the economic
17 impact is not relevant to a SWIM challenge, because
18 it's not legally relevant or required under the SWIM
19 Act.
20 HEARING OFFICER: The question, then you may be
21 in agreement with Ms. Kavanaugh then.
22 MR. NETTLETON: I may be.
23 HEARING OFFICER: We may have a first here.
24 MR. GREEN: I think I understand what you're
25 directing me to do, and I will attempt to do that within
168
1 10 days. In the proposed order I will also cover
2 the role of economic issues in the SWIM plan as we
3 see it and whether the Hazen and Sawyer report is
4 part of that plan.
5 (WHEREUPON, MR. BURGESS LEFT THE HEARING ROOM.)
6 MS. PONZOLI: And may we respond to that?
7 HEARING OFFICER: Yes.
8 MR. HOFFMAN: We would like not just to respond,
9 we would like the federal government and the state
10 government's position on these things flat out. I
11 mean, we're always being told that these hearings,
12 and it's interesting, that everybody else is being
13 vague, but they're not, and yet they're demanding,
14 they have demanded from us if we have ever supported
15 a commodity support price program, and we have to
16 find out how that has to do with whether the STAs work
17 or not. We are always being told, "I'll be
18 perfectly honest with you. I'll be very honest with
19 you. Let me speak frankly."
20 I speak perfectly frankly and candidly every
21 time I talk, not only on those occasions when it
22 seems to benefit my argument, and I'd like right now,
23 I'd like to have their position on their economics.
24 I have never seen any response to my objections as
25 to why this is relevant to ask for these commodity
169
1 support price programs, even if we had any.
2 So I'd like to get it all right together the
3 same day, and then we can all respond.
4 MR. NETTLETON: Well, I believe I just gave my
5 position.
6 HEARING OFFICER: I thought Mr. Hoffman kind of
7 explained his position, and I have understood this
8 whole argument today, the initial discovery request
9 of this financial information was predicated upon
10 the allegations that were made in the petitions
11 challenging the SWIM plan, because it wasn't
12 practicable or economically feasible, etcetera.
13 So...
14 MR. NETTLETON: It was also raised, I believe,
15 Mr. Hearing Officer, in our motion to strike
16 originally from the petitioners, if I'm not mistaken,
17 which was denied without prejudice to re-raise,
18 along with various other allegations in the
19 petitions.
20 HEARING OFFICER: Right. So let's do this. I
21 think we have reached the general consensus that,
22 what have we reached? Mr. Green is going to take
23 10 days then and prepare a proposed order which he
24 will circulate to everybody setting forth his
25 position I guess on the economic issues and also a
170
1 summary of your presentation today as to the nature
2 of the economic testimony you will be presenting.
3 MR. GREEN: Right.
4 HEARING OFFICER: You will have an opportunity
5 to respond to that before the hearing on October 30th.
6 We'll see where we are on October 30th.
7 In the meantime, and I guess since your
8 proposed order will address the nature of these
9 economic issues it will also talk about Hazen and
10 Sawyer, so each party will have an opportunity under
11 the proposed order of Mr. Green to address that
12 issue.
13 MS. PONZOLI: Will all parties be including
14 other petitioners responding to the other issues,
15 or will they be joined with Mr. Green in his proposed
16 order?
17 HEARING OFFICER: I think we've got a difference
18 over here between the League and the Coop in terms
19 of what the role of the economic study will be, so...
20 MS. KAVANAUGH: We will try to develop a
21 unified position, but at this time we do not
22 concur.
23 HEARING OFFICER: Right, and I think the League
24 has set forth its potion in the motion that you
25 have yet to review, so they can respond to Mr. Green's
171
1 order as well before, Mr. Green will have 10 days to
2 do it, so why don't you take 10 days to file your
3 responses?
4 MS. PONZOLI: Fine. Thank you.
5 MR. NETTLETON: Mr. Hearing Officer, before you
6 move to the next hard issue, I haven't discussed this
7 with anybody here, but I would like to suggest if it
8 doesn't create any problems that we have agreed to
9 put off the legal briefing on the burden of proof
10 thing for two weeks, which makes it due this Monday.
11 I'd like to request an additional week within which
12 to file those briefs, which would also extend the
13 response time a week. It would still be briefed
14 before the next hearing, however.
15 MS. PONZOLI: No objection.
6 HEARING OFFICER: Will I have an opportunity to
17 read it before the next hearing?
18 MR. WATTS-FITZGERALD: The initial briefs are
19 due on the 13th and the response 10 days thereafter.
20 MS. PONZOLI: Right.
21 MR. NETTLETON: That will be the 23rd and the
22 30th.
23 MR. WATTS-FITZGERALD: That gives us a week.
24 HEARING OFFICER: That's plenty of time.
25 MS. KAVANAUGH: Are you suggesting we just move
172
1 the whole thing forward a week? We would give you
2 our a week later than we would, or are we all to
3 submit our briefs, joint briefs, a week later and then
4 our reply briefs?
5 MR. NETTLETON: Right. October 13th for the
6 initial briefs, and the reply briefs 10 days after,
7 the 23rd.
8 MS. PONZOLI: Sure. No problems.
9 MR. NETTLETON: Thank you.
10 HEARING OFFICER: Okay. Why don't we take a
11 couple of minutes break to gather our thoughts before we
12 move on to the next issue?
13 (WHEREUPON, THE HEARING WAS RECESSED FROM
14 5:08 P.M. TO 5:18 P.M., AT WHICH TIME MR. HOFFMAN WAS
15 ABSENT FROM THE HEARING ROOM, AND MR. DAVIS AND MR. BURGESS
16 WERE PRESENT IN THE HEARING ROOM.)
17 HEARING OFFICER: Okay. We are down to one last
18 issue.
19 MS. PONZOLI: Mr. Hearing Officer, I'd like to
20 say that this has been a day full of surprises. The
21 last few days have been filled with several surprises.
22 I would like to have an opportunity to respond
23 to the second amended petition and what it raises in
24 regard to the entry issue, because it was clearly
25 paired with my entry issue in mind, and it was
173
1 submitted to the United States on the Friday
2 following when I submitted my briefs on Wednesday,
3 and I would like that opportunity to respond to what
4 now is a new petition with new issues.
5 So you have a hearing set aside on the 16th. May
6 I file my briefs in some limited period of time, and
7 let's argue my entry at that time?
8 MS. KAVANAUGH: I think at the last hearing it
9 was contemplated, in fact it was specifically came up
10 if any individual did not wish to limit the issues they
11 could amend, and we did, and I believe we
12 indicated in our response to the amended, anyway
13 one of our experts believed we did in fact intend to
14 amend to ensure there was no ambiguity about those
15 extra parameters at least.
16 (WHEREUPON, MR. HOFFMAN ENTERED THE HEARING ROOM.)
17 So I don't understand what kind of a response,
18 a motion in response to the petition or recasting
19 their emphasis?
20 HEARING OFFICER: Okay, let's start out by
21 saying I do recall you mentioning there was a
22 potential amendment, and I think throughout the
23 course of this proceeding we've been working under
24 the assumption through discovery and these hearings
25 we would be able to narrow the scope of the issues
174
1 further and further, and obviously I hopefully
2 believe we're making some progress in that regard,
3 and then I think the progress will continue as
4 time goes on.
5 I think the appropriate way to do that is to file
6 a motion to amend, and then we'll, you know, get any
7 objections if need be at that time.
8 I guess, Ms. Ponzoli, I'm not sure what you're
9 saying. You're saying because of this amended
10 complaint that's been filed but which has not yet been
11 granted...
12 MS. KAVANAUGH: We moved ore tenus following the
13 last hearing. I believe, we can review the
14 transcript, but I believe you said yes, and that was
15 our understanding, but I'll be happy to file a
16 motion.
17 HEARING OFFICER: Well, probably the best way to
18 do it is to file a motion, and we'll grant it, so the
19 record is clear.
20 Now, but let's work under the assumption that
21 it's going to be granted.
22 MS. PONZOLI: Right.
23 HEARING OFFICER: Because I don't think there's
24 really going to be objections.
25 MS. PONZOLI: That's my assumption, but I think
175
1 what I'm troubled by is that I wrote my brief
2 just days before they filed it, and I think the
3 timing is fairly clear. I wrote my brief based upon
4 a petition that was worded very, very differently,
5 and I have laid out some very, very different
6 provisions, and now they're going to make arguments
7 based upon a wholly different document, a docket I
8 have not had the benefit of reviewing more than a
9 few hours.
10 HEARING OFFICER: Sure, and I'll give you an
11 opportunity to do that if we need to.
12 Let me make some preliminary comments and see
13 if we can get to the heart of some of the issues in
14 this, and maybe through this discussion we'll see
15 what needs to be filed later.
16 MS. PONZOLI: Sure.
17 HEARING OFFICER: As I think I indicated at the
18 last hearing after reviewing all the various pleadings
19 and stuff filed now, I notice that the League and the
20 Cooperative have objected to the access and have
21 argued a number of general grounds as to why the
22 U. S. Government should not be granted access to the
23 property, and we get into all these issues about
24
mercury and how all that relates.
25 I'm going to start with the general assumption
176
1 that the U. S. Government is entitled to access to the
2 petitioners' property, because I think by filing the
3 petition they have raised a number of issues, and
4 perhaps the most fundamental of which is the source of
5 the phosphorus that's making its way into the Park
6 and into the Refuge.
7 By challenging the assumptions that are inherent
8 in the SWIM plan that is coming to the agricultural
9 area I think the U. S. Government, the Water
10 Management District, and the various people in
11 support of the plan have the right to access the
12 property to determine whether that in fact is true.
13 So I'm working from that assumption to begin with,
14 so everybody knows. I have not seen anything in
15 any of those motions in opposition to the request for
16 access that has convinced me otherwise.
17 So then we get down, assuming that's the case,
18 then we get down to the two other issues as to what
19 should be permitted when they get access to the
20 property, and then what should be done with the
21 results of whatever that access takes place.
22 I think those are the two issues that we have to
23 deal with.
24 I guess the fundamental question that I have in
25 my mind is assuming there will be access, what is my
177
1 authority to direct how the U. S. Government or
2 what they do with the samples that they take? I
3 don't know that, you know, if there has to be some
4 sampling, some soil taken out of the ground or some
5 water taken out of the ground from a canal or
6 whatever, why is it necessary for me to get into the
7 minutia of what happens to it once it's taken off the
8 property.
9 I don't, I think it's reasonable to assume that
10 some soil will have to be taken, some water is going
11 to have to be taken, and once it's taken that
12 intrusion as long as it's not done in a manner that
13 destroys the property or is unnecessarily abusive
14 to the land, I don't know why it's particularly
15 relevant for me to worry about what happens once it's
16 taken off the property.
17 In that regard I guess I have a difficult time
18 understanding what the protected interest that the
19 petitioners are seeking me to protect.
20 It's not a privacy, well, I guess to some
21 degree maybe it is a privacy issue, but it's not like a
22 bodily intrusion, it's not financial data, it's not
23 something that immediately strikes me as necessary or
24 warranting a great deal of scrutiny from my standpoint.
25 So having said that I guess perhaps what I should
178
1 do is turn it over to the petitioners and let them
2 give me an explanation of why they think I should
3 take some steps in limiting or trying to control what
4 the U. S. Government does with the samples, and of
5 course you are free to argue the issue as to whether
6 there should be access at all.
7 I'm just giving you my preliminary statement
8 based on what I have read in the pleadings from both
9 parties, the review of the cases that I was able to
10 review and that I have been out of town quite a bit
11 and have not been able to pull any federal cases
12 that were cited, but I have reviewed the state cases
13 cited, and I'll be happy to reconsider that argument
14 if you can convince me otherwise.
15 But at least from a preliminary standpoint I
16 did not find a convincing argument as to why access
17 should be denied outright. Who wants to start?
18 MS. KAVANAUGH: I guess I need to start. We
19 obviously disagree on the access issues, and it's the
20 same sort of disagreement we had with the financial
21 information, and that is the SWIM plan data base
22 doesn't go onto private farms, does not assess
23 information from the private farms, and is based on
24 information taken in state waters, which is of course
25 the only place water quality violations can occur, and
179
1 certainly I guess our position is the testing in the
2 state canals and the state waters in the EAA would
3 give you the information we need.
4 In this point as I understand it the District's,
5 Dr. Davis is with me, but at this point the, we are
6 not disputing there's phosphorus in the waters coming
7 from the EAA. We never have intended to dispute
8 there is.
9 But what's at issue in the SWIM plan is what
10 it's doing in the EPA, the Everglades Protection
11 Area, and therefore has to be reduced a certain amount
12 in order to prevent that damage.
13 HEARING OFFICER: Let me just interrupt you for a
14 second.
15 MS. KAVANAUGH: Yes.
16 HEARING OFFICER: As I read the allegations
17 thought it seems to me from looking at the petitions
18 from the various parties, and I don't know I have
19 gone back and looked at the second amended petition
20 very specifically, but at least your first amended
21 petition very clearly challenged the assumption that
22 was set forth in the SWIM plan that phosphorus has
23 shown up in the Park from the...
24 MS. KAVANAUGH: If that's what it said, it was
25 not our intent. What we do dispute is how much, what
180
1 the impacts are and also how much can be attributable
2 to other sources, such as rainfall on the EPA.
3 HEARING OFFICER: Others are in there as well.
4 MS. KAVANAUGH: But what we are saying is we
5 never intended to present any information that "X"
6 amount of phosphorus is coming off "X" farm. We
7 don't intend to make that case. We intend to make
8 our case on the data collected in the state waters.
9 We may question their sampling methodology or
10 the way they use that data, but it's not our intent
11 to maintain, for example, that Farm A only, there's
12 "X" amount of phosphorus coming off of Farm A or was
13 or whatever.
14 So I guess that's our first, phosphorus is
15 obviously the relevant issue, how much, you know,
16 were there and how many impacts it's causing, but
17 so we really don't understand what use could be,
18 what use the District or the United States, what
19 could they do with the information?
20 HEARING OFFICER: Well, let me throw this out
21 to you. Obviously one of the issues you're
22 challenging is whether the source of the phosphorus
23 appearing in the Park and the Refuge is from
24 somewhere other than the EAA and whether it is
25 coming from, you know, wherever, from the rain or
181
1 wherever, but assuming that that's an issue that you
2 intend to raise wouldn't it be pertinent for the
3 people who are supporting the plan to have access to
4 the property to investigate the assumptions that are
5 inherent in the plan, that it's coming from the EAA?
6 That seems pretty fundamental to me.
7 MS. KAVANAUGH: Right. Again, Mr. Hearing
8 Officer, and I can put Dr. Davis on, if you look at
9 the data to the SWIM plan, what the District has
10 determined to be coming from the EAA is what they
11 are measuring at the major pumps, and four major
12 pumps.
13 We're not planning to up behind those pumps and
14 make a presentation that Farm A, as I say, you know,
15 is only discharging A, B, or C. We're only concerned
16 about what's happening at the pumps.
17 HEARING OFFICER: Well, whether you intend to do
18 that or not I think it's clear to me that those
19 that are supporting the plan should have the
20 opportunity to investigate that if it could support
21 the conclusions in the plan.
22 MS. KAVANAUGH: But we're not disputing the...
23 HEARING OFFICER: Well, you are disputing that
24 inherently when you say it's coming from another
25 source.
182
1 MS. KAVANAUGH: I guess what we are disputing
2 is more the degree it comes from another source,
3 not whether it comes from another source, but setting
4 that aside, you know, for the moment, Dr. Davis is,
5 we're talking about sources other than the EAA that
6 have not been taken into account, for instance
7 rainfall.
8 HEARING OFFICER: I understand. Water.
9 MS. KAVANAUGH: Pasture water from the lake. But
10 we think setting that aside for a minute the other
11 aspect is, and I guess more troubling is we I
12 thought at the last hearing, and we expressed it,
13 we feel this is not really intended, that the request
14 is not designated to develop information that
15 they will be using in this hearing on the SWIM plan,
16 and for that reason, you know, we felt there needed
17 to be some justification for it, since we are not
18 placing issues in dispute, and if they use it only to
19 rebut it should be limited to phosphorus. What it
20 means is open to discussion.
21 The second, what is concerning us is your
22 question is why you should limit what they can do
23 with the samples after they take the, and we, the
24 League, and I speak only for the League, New Hope, and
25 U. S. Sugar, indicate there could be some phosphorus
183
1 related organization, there could no one, and we
2 haven't seen it, but there could be one, and we have
3 said we might be willing to consider it. We don't
4 consider the current request appropriate.
5 So far as what they do with samples, Mr. Hearing
6 Officer, we have asked them to specify what test
7 methods they will use, because that will dictate
8 what they are testing for. They have refused to do
9 that.
10 We feel absolutely that unless we have a clear
11 level of comfort that what they are going in for
12 and something relevant is the potential for abuse
13 of the entry which could prove enormous. We are
14 talking about regulatory agencies going on property
15 they would not have access to if it were not for
16 discovery.
17 So we would want you to ensure the maximum legal
18 of protection.
19 Again getting back to the question of access at
20 all if we're not raising the issue, Mr. Hearing
21 Officer, then why would they have to have evidence to
22 defend something that is not at issue? I guess that's
23 what I'm trying to understand.
24 The SWIM plan only puts at issue data taken
25 at the pumps.
184
1 HEARING OFFICER: Well, it seems to me that if you
2 are challenging the source, contending that the
3 source of the phosphorus is from somewhere other than
4 the EAA, whether it's from the rainfall or the amount
5 that comes from the EAA, I think certainly...
6 MS. KAVANAUGH: I guess that's what we're trying
7 to say. When it comes out the pumps, "X" amount of
8 phosphorus is there, and what we're questioning is
9 whether they have factored in these other sources.
10 We are not planning to present evidence that the
11 amount from the EAA, as we discussed, is wrong. We
12 are just saying that...
13 HEARING OFFICER: And I'm way ahead of myself
14 in presupposing what the experts may be able to
15 decipher, and this is discovery, and it's whether
16 or not the information as sought could lead to evidence
17 that may be admissible...
18 MS. KAVANAUGH: And the other assessment is
19 we're talking about phosphorus in the waters coming
20 of the EAA into the state owned canals and
21 downstream.
22 Clearly we have some major objections to the
23 sampling proposed as completely irrelevant to the
24 particular issues. If that's the issue then perhaps
25 if we could get clarification.
185
1 HEARING OFFICER: Going back to your first point
2 in terms of the water that's coming out of the pumps,
3 if it's your position that the SWIM plan does not
4 adequately account for other sources of the
5 phosphorus that's contained in that water, then it
6 seems to me that an expert would very much want to
7 know what's happening on the petitioner's property
8 to directly test some of the challenges that may be
9 made, that the phosphorus that's contained in the
10 water from the pumps comes from somewhere else.
11 I think that very likely could be an issue.
12 It's fairly straightforward.
13 MS. KAVANAUGH: I'm not understanding it, because
14 as I say maybe it's because I know better what we
15 are contesting than I have been able to express.
16 HEARING OFFICER: That may be. I'm sure you
17 understand better what you're contesting, but as I
18 read the SWIM plan and the challenges that have been
19 filed, and I have not studied your second amended
20 petition, but certainly the initial round of
21 challenges that were filed, your first amended
22 petition seems to, those filed by the vegetable
23 growers and the Cooperative seem very clearly to put
24 at issue the source of the phosphorus that was
25 appearing in the Park, and that in the discharges
186
1 coming out of the pumps, and in that regard to the
2 extent that the SWIM plan assumes that is coming from
3 the EAA I think they are entitled to access to test
4 that.
5 MS. KAVANAUGH: I guess I don't understand. If
6 we are not questioning that assumption, and, you know,
7 I'm getting confused now what we are contesting, but
8 then it wouldn't be an issue. I mean, if we're not
9 questioning their numbers, I guess that's the point,
10 if we're not questioning their numbers.
11 HEARING OFFICER: But you are questioning their
12 numbers of their conclusion that the numbers or the
13 amount of phosphorus contained in the water is
14 coming from the farms. You are contesting that,
15 aren't you?
16 MS. KAVANAUGH: I would say we are. Yes and no.
17 HEARING OFFICER: I guess I probably have thrown
18 you off, because I came in here and articulated...
19 MS. KAVANAUGH: We would like to give you
20 some briefing and tell you what we're contending in
21 more detail.
22 MR. GREEN: Well, I don't want to add any more
23 confusion. I'd just like to make one observation
24 and a suggestion, if I could.
25 One thing about the big pumps that have been
187
1 discussed today, I think there are four or six of
2 them, whatever number, five, they draw in the EAA,
3 pump the waters into the water conservation areas,
4 but there are also pumps that move waters of the farms
5 into canals that feed those pumps.
6 My understanding is all EAA waters have to be
7 moved by pumps in general, for the most part, and
8 where they are not moved by pumps there are overflow
9 waters, and I don't think anyone disagreed that the
10 United States or the District ought to be able to
11 sample what's coming out of those pumps or overflow
12 waters from the farms into the main canals which
13 feed into the big pumps, and we have briefed in our
14 response to the issue and made the point that we
15 think that the information potentially that is being
16 sought could be sought in waters of the state, where
17 the point of discharge is, which is what you would
18 do for a point source, STP or something. I just
19 wanted to make you aware of that.
20 HEARING OFFICER: I understand that point, but
21 I guess maybe what I don't understand is are you
22 contesting that the phosphorus that appears in those
23 waters is not coming from the farms?
24 MR. GREEN: For my clients we are saying it's
25 coming from the farms and from the sky and a lot of
188
1 places.
2 Our main issue is there's a lot of phosphorus
3 coming because of construction of the project, and
4 we have made that point clear that that would be
5 there whether the farms are there or not, and that
6 hasn't been taken into account.
7 I don't think the sampling program would d
8 answer that particularly.
9 But the other suggestion I thought I heard
10 Ms. Ponzoli say that she wanted an opportunity to
11 file something in response to that second amended
12 response, and it might affect what the United States
13 feels it needs to do in the EAA. I might have
14 misunderstood that.
15 If that's what she meant, maybe that would be
16 appropriate within 10 days, and it may narrow the
17 issues, and we could respond to that, since it's
18 so late. If that's not what you meant...
19 MS. PONZOLI: No. Since I'm entitled to entry
20 I think we ought to move to the specifics.
21 MR. GREEN: Okay. Fine.
22 MS. PONZOLI: I have to say this, Mr. Hearing
23 Officer, is we are past whether I can get into the
24 EAA, and if we're going to say this whole plan area
25 is subject to discovery, because basically they have
189
1 said everything downhill, that's now in the water
2 conservation area, three years, and now they are
3 coming in for an extended period of time, and I have
4 tried to charge how much more invasions and entry is
5 mine, and they're saying this is off limits. "You
6 can't find out what's coming from the soil or from the
7 rain or from the water."
8 I understand you to be saying, "No, I think
9 the federal government can do the entry," and I think
10 we are past whether I can enter, and I can say to you
11 some of our allegations from the second amended
12 petition say they had felt the activity in the EAA
13 is causing water quality violations, and whether
14 other water quality violations have resulted form
15 the water or from the EAA and whether the District
16 failed to ascertain it and the extent of it, or
17 the percentage of the various changes we are objecting
18 to based on water, phosphorus, or other factors, and
19 on and on.
20 I mean, on and on they dispute the water
21 quality violations downstream I think the really
22 narrow issue, the truly narrow issue that should be
23 addressed is the pesticides and the trace metals and
24 the toxicity. I think everything else is the same
25 as the type of discovery they are trying to do
190
1 throughout the whole panning area, and we should be
2 allowed the same discovery.
3 So if we can get down to those narrow issues,
4 that's worth doing.
5 HEARING OFFICER: Okay, Ms. Kavanaugh, I know
6 you have a lot of people, I guess five people,
7 whispering in your ears. I guess what I'm having
8 difficulty understanding is as I indicated from reading
9 the petition there seems to be at issue in this case
10 the source of the phosphorus contained in the water from
11 the pumps.
12 If that's the issue, then, and it seems the SWIM
13 plan assumes a good portion of it is coming from the
14 EAA, that conclusion is one of the things being
15 challenged, at lest as I read the pleadings and the
16 plan. If that's the case, then it would seem clear
17 to me that it enables the Water Management District
18 and the United States Government to test the
19 conclusions by going onto the property and taking
20 samples and determining if the conclusion is correct.
21 MS. KAVANAUGH: Mr. Hearing Officer, I'm looking
22 at our water quality allegations, page 25, second
23 amended complaint, and maybe it would be helpful
24 so they don't poke me in the back to confer with
25 Dr. Davis, but the water quality violations we're
191
1 testing are water quality violations in the EAA.
2 Those are the measures. If I can suggest we take
3 three minutes for an understanding from Dr. Davis
4 as to how far we would be testing the levels of
5 phosphorus, and again as we were also intending the
6 project and the alteration of the hydroperiod played
7 a great role, and that's a separate issue.
8 But to what degree we intend to dispute the
9 actual levels of phosphorus as measured by the
10 District and set out in the plan, because I think
11 their position is if we are not going to dispute
12 then there's no reason...
13 HEARING OFFICER: Even if you don't dispute
14 the levels, if you dispute the source it goes
15 directly to the question of where it's coming from.
16 MS. KAVANAUGH: The levels attributable to the
17 EAA, as opposed to other sources.
18 HEARING OFFICER: Okay. Why don't we take
19 about a three-minute break?
20 (WHEREUPON, THE HEARING WAS RECESSED FROM
21 5:44 P.M. TO 5:49 P.M.)
22 HEARING OFFICER: Okay. We have many people I
23 guess trying to catch a 6:45 plane.
24 MS. KAVANAUGH: Including myself. Mr. Hearing
25 Officer, I guess where we are is we still object to
192
1 the sampling on farms. We are not going to be
2 contesting where the phosphorus comes from. We
3 will be contesting how the data was calculated, some
4 of the sampling methods, etcetera.
5 We believe we concur with Mr. Green that
6 the information they wish, how much is coming ut
7 of the EAA as opposed to individual farms, but
8 out of the EAA, which the plan addresses, can be
9 determined at the point where the private systems in
10 the EAA meet the public systems in the EAA. How it's
11 distributed behind those we will contend has no
12 relevance.
13 What is relevant is what comes out, and in fact
14 the District's compliance scheme under their rule is
15 that in a basin-wide determination. Only if the
16 standards are violated will they go back on the farm
17 and try to find out who's causing the problem.
18 HEARING OFFICER: What was that?
19 MS. KAVANAUGH: Under the BMP rules, as I
20 understand the regulatory scheme, which has been
21 partly implemented, that strategy, the compliance
22 determination, we would like also to provide you with
23 documentation, but the compliance determination,
24 which I think is five years after the first round of
25 permits, will be measures at the basin level, where
193
1 the private systems meet there's, what, 25, something
2 like that, meet the state waters, the state system.
3 That's where they're going to measure it for
4 determining compliance.
5 Then they will go on up, if there's a problem,
6 then they would go on up and try to identify each
7 individual farm within the region.
8 So that's basically our contention, that to go
9 on individual farms at this point will not give data
10 that is representative to anything and not that is
11 useful in this proceeding.
12 We'd like to have the opportunity to brief this
13 a little more.
14
14 MR. NETTLETON: Mr. Hearing Officer, to make
15 another point aside from the source argument, which
16 I think is invalid, because it ignores some of their
17 claims of alternative sources, which I think
18 Ms. Ponzoli is going to deal with, I would also point
19 out as they request in their second amended petition
20 that we recognize they seem to recognize this issue,
21 and they want to modify the SWIM plan, want this
22 tribunal to issue a proposed order to modify the
23 SWIM plan.
24 One of the challenges they have made, aside
25 from challenging the source, is it does not comply with
194
1 the SWIM plan.
2 In answers to interrogatories, Interrogatory 6
3 specifically, which asks them to substantiate the
4 assertion it did not comply with the SWIM Act,
5 on page 43 of their answers they state another element
6 is that the SWIM plan must contain a description
7 of land uses within the drainage basin, within
8 the approved SWIM plan area, and those tributaries,
9 point and non-point sources of pollution, and
10 permanent discharge activities.
11 Going on to the next paragraph on page 44 they
12 say the SWIM plan must also include a list of the
13 owners of point and non-point sources of water
14 pollution that adversely affects public interest,
15 listing sources that are operating without a permit,
16 with a temporary permit, and presently violating
17 effluent limits or water quality standards.
18 The SWIM plan must also include recommendations
19 and schedules for bringing sources into compliance
20 with state standards when no contrary to public
21 interest.
22 That's one of the challenges they're making to
23 this SWIM plan, and it does not include now that
24 we're not allowed to go in and check and find out,
25 which if their challenge is correct, and I would not
195
1 concede that at this point, if it is correct that's
2 something that this Division should enter in a
3 proposed order to modify the SWIM plan to identify the
4 point and non-point sources of pollution which they
5 are challenging is not in the plan and need to be
6 in there.
7 So it would be relevant to that issue as well,
8 which they specifically raised and have answered in
9 their sworn interrogatories, that that's something
10 they are challenging here.
11 HEARING OFFICER: Okay, Ms. Ponzoli, you have
12 something you wanted to add?
13 MS. PONZOLI: Well, I wanted to address the
14 concept of the alternatives. I think you have heard
15 some argument by Mr. Green today that you will be,
16 I think it has been Mr. Green, maybe it was somebody
17 else, that you will be looking at the alternatives
18 and the cost of the alternatives in the EAA.
19 The League itself has presented a rather
20 attractive and fancy presentation of the strategy to
21 revitalize the Everglades and preserve farming, and
22 they look at alternatives in the EAA that they think
23 could reduce phosphorus, and they have sugar mills
24 and what you have done at the sugar mills. That's
25 one of the locations where we have asked to go in
196
1 and test the phosphorus, at a sugar mill.
2 It is not accurate that all they are contesting
3 is what's coming out of the pumps. It's far broader
4 than that, and the final hearing will address issues
5 far broader than that, and to close off some huge
6 section of the whole Everglades Protection Area,
7 Everglades Planning Area, to discovery is just, it's
8 unfair. It's an unfair situation that we would be
9 placed in the burden of not having access to any of
10 this.
11 We have limited our access down in a very
12 narrow way, and I don't know, I guess you need to
13 tell me, because you indicate I should be able to
14 have access, so I think I'm arguing against myself if
15 I keep talking.
16 MR. HOFFMAN: Just two minutes, so they don't miss
17 their plane.
18 We are a separate party. We adopted by reference
19 or embraced the memos in this case by the League
20 and the Coop on the issue, because of our own
21 allegations.
22 Just to give an example, and this is the
23 example raised by the federal government in their
24 request for entry, our allegation that they cite as
25 "A", whether there is environmental damage in or
197
1 threatening the Park, EPA or the Refuge as a
2 result of nutrient levels in surface waters going
3 into those areas from the EAA.
4 We all acknowledge there's water flowing in
5 from the pump, and the allegation is whether that
6 water as it flows out, whatever is in there
7 whatever it is, whether it is causing damage to the
8 Park, and those are the allegations we talked about
9 with respect to nutrients flowing from the EAA.
10 So it's not really relevant which farm it comes
11 from in the area above. It's agreed in our
12 allegations that the water is coming from this area.
13 We're questioning whether there is proof that there
14 is damage to the Park or elsewhere.
15 HEARING OFFICER: Let me just ask you, the
16 bottom line is we're dealing with discovery. I'm
17 not talking about relevancy in terms of the final
18 hearing.
19 At this point I haven't heard any of the
20 experts' testimony, and I don't know what the
21 experts may use with this information once it's
22 taken.
23 But it seems pretty obvious to me that an
24 expert who is developing conclusions as to the
25 source of phosphorus, whether it's coming from the
198
1 farms, whether it's coming from the rainfall, whether
2 it's coming from the lake or wherever, that testing
3 in that area would give them some useful information
4 to help them develop conclusions, and to test the
5 assumptions that are set forth in the SWIM plan.
6 Isn't that very clearly relevant, I mean
7 discoverable information?
8 MR. HOFFMAN: I, my problem is I don't see how
9 it's relevant to this case.
10 HEARING OFFICER: I didn't finish my thought.
11 I had stopped and paused, because it's getting late,
12 but the other issue that I have is that I have a
13 little bit difficulty in standing what the discovery
14 necessarily involves, a balance of competing
15 interests between the parties, and I have a little
16 bit of a difficult time understanding what the
17 intrusion that exists, other than having, you know,
18 federal and state investigative agencies on the
19 property taking soil, it's not like they're destroying
20 the land and not like you're doing irreparable harm,
21 so I guess where is the big difficulty in allowing
22 the scientists our to test their assumptions and
23 conclusions?
24 MS. KAVANAUGH: Mr. Hearing Officer, if they
25 are testing their assumptions and conclusions on
199
1 on relevant matters, obviously we don't agree with you
2 on the access issue. We really, at least from out
3 clients' viewpoint, they can find out how much
4 phosphorus is coming out of the farm pipes by sampling
5 where the farms hit, but setting that aside for the
6 moment are these other parameters, Mr. Hearing
7 Officer.
8 I mean, this is not a situation, we are not in
9 an enforcement proceeding. There's no allegation of
10 water quality violations. And to, it seems
11 inherently unfair to allow them to use this proceeding
12 to do things they couldn't do otherwise, where
13 they haven't made a showing of, if they were here to
14 terry and prove water quality violations, then they
15 should tell us that, that "We think there are water
16 quality violations on the land, and we want to come on
17 and see." They have made no such allegations.
18 But if the true goal of the request is to find
19 out how much phosphorus is coming out of the EAA
20 going into the EPA and what the impacts of those are,
21 then we would submit they get that information at the
22 basins where they plan to test compliance, and
23 they should not be allowed to come onto private property
24 to test for any parameters other than possibly
25
200
1 phosphorus, as you have indicated.
2 HEARING OFFICER: Okay. It's almost six o'clock,
3 and I know everybody is ready to go. Perhaps the best
4 way to resolve this is to set up for the 16th as well,
5 and let's deal with it, we can finalize it, submit
6 your briefs. I don't know what time frame was
7 addressed on the other ones. Submit your briefs by
8 the 13th on the issues, simultaneous filings.
9 I guess as I have already indicated I think,
10 you know we are dealing with discovery here. There
11 is a great deal of flexibility in, you know, I have
12 to balance the competing interests, but it seems
13 pretty clear to me that the experts on behalf of those
14 supporting the plan would garner useful information
15 as a result of access to the property and the
16 ability to test our there, so in that regard, as I
17 recall, Ms. Ponzoli, you have submitted something,
18 but I don't know if you specifically delineated in
19 the sites or whatever you proposed, but you have done
20 that already?
21 MS. PONZOLI: I have indicated that I wanted
22 to do in the five yield bands "X" number of sites in
23 the five yield bands. Do you want more detail?
24 HEARING OFFICER: No, no, I guess I just want to
25 make sure that everybody has an understanding as to
201
1 what is proposed, so we can resolve this finally on
2 the 16th, because I think we need to do this, and
3 I know I flipped through some of the documents, and
4 I know I have seen your comparison chart, but I
5 don't know if you have specified, I don't think you
6 looked for the same frequency patters as I recall as
7 shown in the Park and the Refuge by the petitioners.
8 But I want to make sure you have a specific
9 proposal on the table as to at least the frequency and
10 the locations of the testing that are going to be
11 done, so the specific objections to that can be
12 addressed on the 16th.
13 MS. PONZOLI: If you are saying you want me to
14 pinpoint which farm I want to go to, is that what you
15 are asking? Because I have given locations. I have
16 given frequencies. I have given sites. I have
17 given all of that.
18 HEARING OFFICER: You have given locations?
19 MS. PONZOLI: I didn't give farms.
20 MR. WATTS-FITZGERALD: By generic sties, because
21 just as they have a problem saying, "We're going to
22 put a site at each test coordinate," we have to say
23 we're going to test at a ditch, we're going to test
24 at so many sugar mill ponds, but what we did was we
25 circumscribed the sites by giving a maximum area and
202
1 said with that we will take no more than "X"
2 samples, and we have a total of 40 sites max
3 throughout the entire 500,000 acres, and we delineated
4 it by the type of site precisely what we're looking
5 for, whether a field well or whatever.
6 HEARING OFFICER: Well, it sounds to me like you
7 have a firm proposal on the table. If there are
8 specific objections, make them now, and we're going
9 to resolve them on the 16th. We need to get these
10 access issues behind us so the testing can take
11 place.
12 MR. HYDE: Mr. Menton, I don't want to unduly
13 complicate these proceedings, but I do think you
14 need to keep in mind that there are two categories of
15 testing here. There's one, the phosphorus testing,
16 which is arguably more related to the proceeding.
17 HEARING OFFICER: I understand.
18 MR. HYDE: There is another category which
19 includes but is not limited to mercury, and I think
20 it's a whole different set of problems, and in fact
21 a jurisdictional issue as well.
22 HEARING OFFICER: Well, I understand the mercury
23 issue. I have seen it raised in the various matters,
24 and that goes to the matter that I raised in my
25 initial presentation as to I guess, I wonder
203
1 whether if the samples that are necessary in order to
2 test for phosphorus, you know, it's very simple as
3 to what needs to be done. You go out and take a
4 core sample or a water sample, and if they take
5 those samples whatever they do with them after they
6 walk off the property, I just wonder what my
7 jurisdiction is to even control that.
8 Now there is a related issue as to whether I have
9 authority to enter a protective order regarding
10 disclosure of the information, and that's been
11 touched on in some of the briefs, and I think we need
12 to resolve that on the 16th as well, so address that
13 in your proposals.
14 MR. HYDE: One other thing that we did discuss in
15 August was whether the government, the respondents,
16 should identify the tests that they were employing.
17 We still think it's very important and a very salient
18 issue for resolution.
19 HEARING OFFICER: I think that goes to the point
20 that I was just making. There are two ways of dealing
21 with this. Obviously the first would be to say, okay,
22 you can take samples, and all you can do is test for
23 phosphorus or some specific test. That's all you're
24 entitled to do. I don't know how I would ever
25 enforce or, you know, monitor that.
204
1 MS. KAVANAUGH: We'll present you some ideas on
2 that.
3 HEARING OFFICER: But, you know, that's the
4 first issue, and I have some question in my mind
5 whether I even need to get into that.
6 The second is whether through some protective
7 order any of those matters can be alleviated anyway,
8 or you can satisfy yourself it's not going to be
9 disclosed, so it's not a concern. I don't know if
10 I have the authority to do that or not. I haven't
11 really sat down and looked at the cases in that
12 particular area. Some of the parties have touched on
13 it, but it's not been fully briefed.
14 So I think your concern can be addressed in one of
15 two ways, either by a limitation on the tests to
16 be conducted or a protective order, and whether either
17 or both are appropriate I think we need to address it
18 on the 16th.
19 Okay. Anything else we need to take up?
20 All right.
21 (WHEREUPON, THE HEARING WAS CONCLUDED AT
22 6:05 P.M.)
23
* * * * *
24
25
205
1 CERTIFICATE OF REPORTER
_______________________
2
3 STATE OF FLORIDA
4 COUNTY OF LEON
5
6 I, SUE HABERSHAW JOHNSON, Certified Court
7 Reporter, Registered Professional Reporter, and Notary
8 Public in and for the State of Florida at Large:
9 DO HEREBY CERTIFY that the foregoing hearing was
10 taken before me at the time and place therein designated;
11 that my shorthand notes were thereafter reduced to
12 typewriting under my supervision; and the foregoing pages,
13 numbered page 1 through page 202, are a true and correct
14 record of the aforesaid proceedings.
15 I FURTHER CERTIFY that I am not a relative,
16 employee, attorney, or counsel of any of the parties, nor
17 relative or employee of such attorney or counsel.
18 WITNESS MY HAND AND OFFICIAL SEAL THIS 1st DAY OF
19 OCTOBER, A.D., 1992, IN THE CITY OF TALLAHASSEE, COUNTY OF
20 LEON, STATE OF FLORIDA.
21
22
________________________________
22 SUE HABERSHAW JOHNSON
23
24
25