       DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                            FOURTH DISTRICT

                     CITY OF WEST PALM BEACH,
                              Appellant,

                                    v.

       PALM BEACH COUNTY, FLORIDA DEPARTMENT OF
  TRANSPORTATION and SOUTH FLORIDA WATER MANAGEMENT
                       DISTRICT,
                        Appellees.

                             No. 4D17-1412

                            [August 8, 2018]


  Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Administrative Hearing, SFWMD # 2017-034-FOF-ERP.

   Jane Kreusler-Walsh and Stephanie L. Serafin of Law Office of
Kreusler-Walsh, Vargas & Serafin, P.A., West Palm Beach, and Kimberly
L. Rothenburg of City of West Palm Beach, West Palm Beach, for appellant.

   Helene C. Hvizd, Senior Assistant County Attorney, West Palm Beach,
and Marc Peoples, Assistant General Counsel of Department of
Transportation, Tallahassee, for appellees Palm Beach County and Florida
Department of Transportation.

  Susan Roeder Martin, West Palm Beach, for appellee South Florida
Water Management District.

  Jason Totoiu, Lisa Interlandi, and S. Ansley Samson of Everglades Law
Center, Inc., Winter Haven, for Amici Curiae-Florida Wildlife Federation,
Audubon Society of the Everglades, Sierra Club, Conservancy of
Southwest Florida, and National Wildlife Federation.

FORST, J.

   Appellant City of West Palm Beach (“the City”) challenged the South
Florida Water Management District’s (“the District”) 2016 notice of intent
to issue an environmental resource permit to the Florida Department of
Transportation (“FDOT”) and its co-applicant, Palm Beach County (“the
County”) for a road extension project and related surface water
management system. The basis of the City’s challenge was that the project
would have adverse impacts on Grassy Waters Preserve (“Grassy Waters”),
a nature preserve and water catchment area owned by the City. Accepting
the recommendation of a Department of Administrative Hearings
Administrative Law Judge (“ALJ”), the District’s final order approved the
permit.

   The City makes two arguments on appeal. The first is that the City was
denied due process based on procedural errors which prevented the City
from fully addressing the final permit application. The second is that the
ALJ erroneously interpreted the governing water quality standards,
resulting in materially flawed findings approved by the District.
Concluding that the cumulative effect of the errors materially prejudiced
the City, we reverse the final order and remand for a new hearing on the
City’s petition.

                                Background

   In 1989, the District issued the original permit conceptually
authorizing the construction of a storm water management system known
as the Ibis System. The Ibis System was designed to receive and treat
water to serve a nearby residential golf community. The original permit
has been amended several times over the years.

   The Ibis System has two components—Ibis Lakes and Ibis Preserve.
When Ibis Lakes reaches a certain water level, the water is pumped into
Ibis Preserve. Water from Ibis Preserve then flows into Grassy Waters.
Grassy Waters is an oligotrophic wetland and is adversely affected by low
levels of nutrients, particularly phosphorus. Grassy Waters is home to
numerous species of plants and animals, including threatened and
endangered wildlife, which depend on a low phosphorus environment.
Grassy Waters is also part of the City’s drinking water supply system.

   In March 2016, the City filed a petition (amended in June 2016)
challenging FDOT and the County’s permit application, arguing that the
project will have a series of adverse impacts on Grassy Waters.
Specifically, the City argued that FDOT and the County failed to provide
reasonable assurances that the project would not: 1) adversely impact
water quality, and fish and wildlife; 2) cause secondary or cumulative
impacts; or 3) fail the public interest test. The City’s petition was set for a
formal administrative hearing.



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   About a week before the scheduled start of the final hearing on the
permit modification, FDOT and the County amended their application to
address the City’s concerns about adverse impacts to Grassy Waters. The
amended application included revised construction plans, a redesigned
storm water management system, a nutrient loading analysis, a
compensatory mitigation plan addendum, and a new cumulative impact
assessment. One of the main features of the amendment was to increase
the width of the proposed swale along the roadway by ten feet and raise
the outfall, resulting in the swale retaining more storm water.

   The amended application included an assertion that these changes
would result in a net improvement to the water quality discharged from
the project site. The assertion of a net improvement was not part of the
original permit application. Because of the amended application, the City
moved to continue the hearing, arguing that the City’s expert, Dr. Harper,
needed additional time to analyze the amended application and that the
City needed more time to depose FDOT and County experts on this issue.
The continuance motion was denied by the ALJ.

   The final hearings took place on August 23-26 and November 29-30,
2016. The night before the first day of the final hearing, counsel for FDOT
received an email from the City with a forty-five page attachment of
PowerPoint slides prepared by Dr. Harper which contained his updated
opinion as to the project’s amended discharge plan. Dr. Harper’s updated
opinion included an analysis of groundwater seepage from the swale.

   On the morning of the hearing, FDOT moved to exclude the updated
opinion, arguing that Dr. Harper’s original opinion was based only on the
surface water discharge from the project, and the groundwater seepage
theory should have been argued from the outset because the project had
always called for a swale. The City argued that the ten-foot increase in the
swale was not a minor modification and that additional time was necessary
so that Dr. Harper could analyze the amendment and the City could re-
depose pertinent witnesses.

   The ALJ called Dr. Harper to the stand to present a summary of his
post-amended application opinion to determine whether to allow the
groundwater seepage theory, deny the groundwater seepage theory, or to
grant a continuance to allow for further discovery. Dr. Harper testified
that once he received the amended application he “began to wonder” about
the increase in water, the amount that would be stored in the swale, and
how much would seep into the ground. Dr. Harper acknowledged that he
did not consider groundwater seepage prior to the amended application
despite the fact the project had always called for a swale. The ALJ found

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that because groundwater seepage was not raised in the petition and was
not discussed during depositions, the testimony on the total volume of
seepage from the swale would be excluded.

   During the course of the hearing, both sides presented several
witnesses. After the first phase of the hearing in August, the City renewed
its request to allow Dr. Harper to testify about the total volume of
groundwater seepage. The ALJ treated the request as a motion to amend
the City’s petition, which was ultimately denied.

   In November, towards the end of the final hearing, the City asked to
make a formal proffer of Dr. Harper’s groundwater seepage analysis. The
ALJ denied the proffer as prejudicial but allowed the proffer of the
declaration of Dr. Harper’s analysis.

   The ALJ issued a recommended order supporting the approval of the
permit application as amended. The ALJ concluded that the application
met all permitting criteria and that the project would not cause or
contribute to a water quality violation; instead, it would create a net
improvement in water quality. The ALJ concluded that the evidence did
not support the conclusion that groundwater seepage would cause
additional nutrient loading into Grassy Waters.

   In paragraph 157 of the recommended order, the ALJ held the narrative
nutrient standard requires “a system-wide imbalance in natural
populations of flora and fauna . . . to establish a violation of the narrative
nutrient standard” so “the near-destruction of an ecosystem [is] the line
that must be crossed before the standard is violated.”

   The District and the City filed exceptions to paragraph 157 of the
recommendation. The City argued that the ALJ’s interpretation of the
narrative nutrient standard was erroneous, and the District argued that
the narrative nutrient standard is a Florida Department of Environmental
Protection (“FDEP”) rule and that the District must defer to the FDEP’s
interpretation of the rule.     In its final order adopting the ALJ’s
recommendations, the District held:

      The dispositive issue on the topic of water quality is that the
      Project will result in a net improvement by treating its
      stormwater before it discharges to the Ibis system. . . .
      Therefore, findings of fact and conclusions of law addressing
      the narrative nutrient standard . . . do not affect the outcome
      of this proceeding.


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                                   Analysis

   Section 120.68(7), Florida Statutes (2018), sets forth the standard of
review. An agency action may be remanded or set aside only if we
determine: the action depends on a finding of fact which is not supported
by competent and substantial evidence in the record; the fairness of the
proceeding was impaired by a material error in procedure; the agency
erroneously interpreted the law and a correct interpretation compels a
particular action; or improper discretion. Id.

   A. Florida’s water policy

    The Florida Legislature has taken due care to protect our water because
it is among our most basic resources. § 373.016(1), Fla. Stat. (2016). The
Legislature has declared it the public policy of Florida “[t]o promote the
conservation, replenishment, recapture, enhancement, development, and
proper utilization of surface and groundwater,” “[t]o minimize degradation
of water resources caused by the discharge of stormwater,” and “[t]o
preserve natural resources, fish, and wildlife.” § 373.016(3)(b), (3)(f), (3)(g).
The Legislature delegated to FDEP and the regional water management
districts the responsibility to implement that policy through rulemaking
and district procedures, including certain standards that must be met
before an entity can receive an environmental resource permit that will
impact Florida waters. See §§ 373.016(5), .4131(1), .414, Fla. Stat.

   B. ALJ’s denial of a full opportunity to address the final permit
      application

    An application can be amended even after an agency issues its notice
of intent to approve or deny a permit so long as due process is preserved.
See Hamilton Cty. Bd. of Cty. Comm’rs v. State Dep’t of Envtl. Regulation,
587 So. 2d 1378, 1387 (Fla. 1st DCA 1991) (“Any additional information
necessary to provide reasonable assurance that the proposed [project]
would comply with the applicable . . . standards could be properly provided
at the hearing.”). This same standard applies to a petition to challenge a
permit, which can also be last-minute amended if due process is
preserved. See Fla. Bd. of Med. v. Fla. Acad. of Cosmetic Surgery, Inc., 808
So. 2d 243, 256 (Fla. 1st DCA 2002), superseded by statute, § 120.52(8),
Fla. Stat. (2003)(holding that a party is not precluded from amending its
petition, even during a hearing on it, if there is no showing of prejudice);
Key Biscayne Council v. State, Dep’t of Nat. Res., 579 So. 2d 293, 294-95
(Fla. 3d DCA 1991) (similar).



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    In determining whether the ALJ abused its discretion in denying the
motion for continuance, we look to whether the denial created an injustice
for the movant; whether the cause of the request was unforeseeable by the
movant and not the result of dilatory practices; and whether the opposing
party would suffer any prejudice as a result. See Cargile-Schrage v.
Schrage, 908 So. 2d 528, 529 (Fla. 4th DCA 2005).

    In this case, due process required the City to have an opportunity to
fully address the amended permit application, particularly because the
amended application asserted the net improvement theory for the first
time—a theory which became the foundation for the permit’s approval.
This is particularly true in a case like this, where the subject matter is
highly technical; the proceeding is administrative opposed to a civil trial
before a jury; and the proceeding’s outcome pertains to issues regarding
the future impact to the environment and public water supply. It was not
the litigation strategy of the City, but rather the late-amended permit
application, which caused the need for additional time to fully evaluate
these highly technical changes and its impact to the water quality of
Grassy Waters. See, e.g., Carnival Cruise Lines, Inc. v. Nunez, 646 So. 2d
831, 833-34 (Fla. 3d DCA 1994) (reversing for a new trial where the trial
court improperly denied the defendant’s motion for continuance to address
plaintiff’s complaint, which was amended after the start of trial).

   Moreover, FDOT and the County did not show they would be prejudiced
by a short continuance to allow the City to prepare for their newly asserted
net improvement theory and amended application. It was about a week
before the start of the final hearing that the permit application was
amended; only days after the application was amended, the City moved for
a continuance. The City also renewed its motion at the end of the first
part of the hearing. If granted, there were two months before the second
half of the hearing, and the City could have conducted further discovery
on the amendment during that time.

   Accordingly, it was error to deny the City the opportunity for additional
time to prepare and deliver a response to the permit modifications, to
address the newly asserted net improvement theory and its effects on
Florida’s water resources. See Key Biscayne Council, 579 So. 2d at 294-
95; see also Carnival Cruise Lines, Inc., 646 So. 2d at 833-34.

   C. ALJ’s erroneous interpretation of water quality standards

   In applying for the permit, the FDOT and the County were required to
provide reasonable assurances that all state water quality standards
applicable to Grassy Waters would not be violated by the project. See §

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373.414, Fla. Stat. At issue is the narrative nutrient standard, which
requires that nutrient concentrations shall not “be altered so as to cause
an imbalance in natural populations of aquatic flora or fauna.” Fla.
Admin. Code R. 62-302.530(48)(b). Alternatively, “[i]f the applicant is
unable to meet water quality standards because existing ambient water
quality does not meet standards, the governing board or the department
shall consider mitigation measures proposed by or acceptable to the
applicant that cause net improvement of the water quality in the receiving
body of water for those parameters which do not meet standards.” §
373.414(1)(b)3., Fla. Stat.

   Both the City and the District took exception to paragraph 157 of the
recommendation, which was modified by the final order, stating the
District would defer to the FDEP’s interpretation of the standard.
However, the final order did not include a substituted finding and
conclusion under the narrative nutrient standard. Even without the
FDEP’s interpretation, the plain language of the narrative nutrient
standard does not require the “near-destruction of the ecosystem.” See
Sullivan v. Fla. Dep’t Envtl. Prot., 890 So. 2d 417, 420 (Fla. 1st DCA 2004)
(acknowledging that judicial deference to an agency’s interpretation of a
statute is not required where the reading is contrary to its plain language).
We cannot conclude that the District properly found the application met
the permitting criteria (reasonable assurances of compliance with state
water quality standards), because the ALJ made material factual findings
through the lens of an erroneous interpretation of the applicable standard.

                                Conclusion

    Florida’s policy to protect and conserve our water is a matter of great
public importance and the cumulative effect of the ALJ’s errors materially
prejudiced the City. Accordingly, we reverse the final order and remand
for a new administrative hearing on the City’s petition.

   Reversed and remanded.

WARNER and MAY, JJ., concur.

                            *        *         *

   Not final until disposition of timely filed motion for rehearing.




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