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Item L1 * 1:30 p.m. Closed Session BOARD OF COUNTY COMMISSIONERS AGENDA ITEM SUMMARY Meeting Date: 3/19/14—MAR Division: County Attorney Bob Shillinger/ Bulk Item: Yes No XX Staff Contact Person: Derek Howard, 292-3470 AGENDA ITEM WORDING: An Attorney-Client Closed Session in the matter of Salvador Gutierrez, Jr. vs. Monroe County, Sixteenth Judicial Circuit Case No. CA-P-12-674. ITEM BACKGROUND: Per F.S. 286.011(8), the subject matter of the meeting shall be confined to settlement negotiations or strategy sessions related to litigation expenditures. Present at the meeting will be the Commissioners, County Administrator Roman Gastesi, County Attorney Bob Shillinger, Assistant County Attorneys Derek Howard, Steve Williams and Susan Grimsley, special outside counsel Michael Burke and a certified court reporter. PREVIOUS RELEVANT BOCC ACTION: 2/19/14 BOCC scheduled Closed Session for 3/19/2014 in Marathon, FL at 1:30 p.m. or as soon thereafter as may be heard. CONTRACT/AGREEMENT CHANGES: N/A STAFF RECOMMENDATIONS: N/A TOTAL COST: Court Reporter costs INDIRECT COST: BUDGETED: Yes No DIFFERENTIAL OF LOCAL PREFERENCE: COST TO COUNTY: Court Reporter costs SOURCE OF FUNDS: REVENUE PRODUCING: Yes No xx AMOUNT PER MONTH Year APPROVED BY: County Atty X OMB/Purchasing Risk Management DOCUMENTATION: Included Not Required X DISPOSITION: AGENDA ITEM# Revised 2/05 County of Monroe The Florida Keys Robert B. Shillinger, County Attorney" Pedro J. Mercado, Assistant County Attorney ** Cynthia L. Hall, Assistant County Attorney ** Christine Li mbert- Barrows, Assistant County Attorney ** Derek V. Howard, Assistant County Attorney ** Steven T. Williams, Assistant County Attorney ** Peter H. Morris, Assistant County Attorney Patricia Eables, Assistant County Attorney Chris Ambrosio, Assistant County Attorney ** Board Certified in City, County & Local Govt. Law June 6, 2017 Kevin Madok, Clerk of the Circuit Court Sixteenth Judicial Circuit, State of Florida Monroe County Courthouse 500 Whitehead Street Key West, FL 33040 BOARD OF COUNTY COMMISSIONERS Mayor George Neugent, District 2 Mayor Pro Tem David Rice, District 4 Danny L. Kolhage, District I Heather Carruthers, District 3 Sylvia J. Murphy, District 5 Office of the County Attorney 11 1 t 12` Street, Suite 408 Key West, FL 33040 (305) 292 -3470 — Phone (305) 292 -3516 — Fax In Re: Salvador Gutierrez, Jr. v. Monroe County, Case No.: CA -P -12 -674 Dear Mr. Madok: Please find enclosed herewith the transcript of the March 19, 2014 closed attorney /client session of the Monroe County Board of County Commissioners regarding the above - referenced matter. Under F.S. 286.011(8), the transcript may be part of the public record because the litigation has concluded. Thank you for your assistance with this matter. Please contact me should you have any questions. Sincerely, Robert B. Shillinger Monroe County Attorney Enclosure I BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY ATTORNEY - CLIENT CLOSED SESSION WEDNESDAY, MARCH 19, 2014 2:05 - 2:45 P.M. Re: Salvador Guttierez, Jr. vs. Monroe County Case No. CA -P -12 -674 A ORIGIN rY. COUNTY COMMISSIONERS: Sylvia J. Murphy, Mayor Danny Kolhage, County Commissioner Heather Carruthers, County Commissioner David P. Rice, County Commissioner George Neugent, County Commissioner STAFF: Robert B. Shillinger, County Attorney Derek Howard, Assistant County Attorney Steve Williams, Assistant County Attorney Susan Grimsley, Assistant County Attorney Roman Gastesi, County Administrator TRANSCRIPT OF PROCEEDINGS Proceedings of the Board of County Commissioners of Monroe County Attorney- Client Closed Session, at the Marathon Government Center, Marathon, Monroe County, Florida, on the 19th day of March 2014, commencing at approximately 2:05 p.m. and concluding at approximately 2:45 p.m., as reported by Susan L. McTaggart, Court Reporter and Notary Public, State of Florida at Large. All Keys Reporting Olde Town Centre 600 Whitehead Street Ln 9701 Overseas Highway Suite 207 Marathon Key West 305 - 289 -1201 305 - 294 -2601 All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 P R O C E E D I N G S MR. SHILLINGER: We're back on the record with Item L -1, an attorney- client closed session in the matter of Salvador Gutierrez vs. Monroe County, Case No. CA -P -12 -674. An attorney - client closed session pursuant to Florida Statute Section 286.011(8) will now be held. It is estimated this meeting will take approximately thirty minutes. The persons attending this meeting will be the County Commissioners, County Administrator Roman Gastesi, myself, Bob Shillinger, the County Attorney, Assistant County Attorneys Derek Howard, Steve Williams, and Susan Grimsley, and a certified court reporter. Since the law prohibits any other persons from being present in the closed session besides the Commissioners, the Administrator, the attorneys, and the court reporter, those folks will remain in the room, and everyone else will be required to leave the room. When the session is over, we will reconvene and reopen the public meeting. Madam Mayor, are you closing the open session? MAYOR MURPHY: Open session is now closed. MR. SHILLINGER: Closed session called to order? MAYOR MURPHY: Closed session is called to order. All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West [ ■ 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. SHILLINGER: For the record, this meeting is being held at my request. I announced at a prior BOCC meeting held on February 19, 2014, that I needed your advice in the matter of Gutierrez vs. Monroe County, Case No. CA - P - 12 - 674. At the meeting the board approved holding a closed session, and public notice was given through the public announcement of the meeting on February 19 and through the publication of today's agenda, the mid -March 19, 2014 agenda, on the County's website. For the record and benefit of the court reporter, each of us will state our name and position, starting with the commission. COMMISSIONER CARRUTHERS: Commissioner Heather Carruthers, District 3. COMMISSIONER KOLHAGE: Commissioner Danny Kolhage, District 1. MAYOR MURPHY: Sylvia Murphy, District 5. COMMISSIONER RICE: David Rice, District 4. COMMISSIONER NEUGENT: George Neugent, District 2. MR. GASTESI: Roman Gastesi, County Administrator. MR. SHILLINGER: Bob Shillinger, County Attorney. MR. HOWARD: Derek Howard, Assistant County All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Attorney. MR. WILLIAMS: Steve Williams, Assistant County Attorney. MS. GRIMSLEY: Susan Grimsley, Assistant County Attorney. MR. SHILLINGER: Just as a reminder, we will be only discussing settlement negotiations and strategy relating to the litigation expenditures. We cannot take any decisive action at today's meeting. We can only provide information and direction to the attorneys. Any decisions that this board makes concerning this case must be done in a meeting open to the public. And I want to set the context of the, a couple of reasons we're meeting today, Derek will provide you with an update on this case, and then we'll have some further discussion on some strategy related to how we want to go forward. This is one of our takings cases. Everybody is familiar with Mr. Gutierrez. This is a case where we potentially could name the State as a third party, and so we want to talk about the strategy of doing that, we want to talk about how the State has expressed an interest in handling these types of cases and our strategy for dealing with that in going forward. But All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 we'll do that after Derek's given us a primer and some background on this case and where we are specifically in the litigation. So I'll turn it over to Derek. MR. HOWARD: Good afternoon. I'll be brief. This is a case that Mr. Gutierrez filed in 2012. It's based on the County's red flag wetlands. Specifically what the lawsuit alleges is that the County has denied Mr. Gutierrez use of his property as a result of a 2004 determination that was rendered by Mr. Ralph Gouldy, then acting as a senior biologist with the Growth Management Division, a determination by Mr. Gouldy that the subject property was, in fact, a red flag wetland. Mr. Gouldy's determination was pursuant to a request for a letter of current site conditions that was filed by Mr. Gutierrez. Interestingly, Mr. Guttierez actually never filed any applications for development approval. It was simply a request for a letter of current site conditions. Mr. Gutierrez essentially went away for a period of about eight years, came back to the County in 2012 when we had a new senior biologist, requested a new letter of current site conditions, and in that letter of current site conditions Mr. Mike Roberts had determined that the property was not, in fact, as he All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 reviewed it at that time, a red flag wetland. So what Mr. Gutierrez is alleging is that the 2004 determination was erroneous and that as a result of that determination the County basically said, you know, you can't do anything with this property. COMMISSIONER CARRUTHERS: Can I -- MR. HOWARD: Yeah. COMMISSIONER CARRUTHERS: Was there any material change in the condition of the property between 2004 and 2012? MR. HOWARD: Not that, not that anyone can discern, just based on the information that's part of the file. There is a very complicated scoring system called KeyWep that the biologists employ to determine the wetland score of a property, and just depending on what the conditions could be at that time, you know, it might score high enough to actually be deemed a wetland, but then years later, because conditions do, in fact, change, you know, it might not be a high functional wetland and therefore would not be subject to our red flag wetland regulations. The problem is there was nothing, really, other than this current letter of site conditions in 2004 that caused the Department to look at this property any further because there was just, you know, simply no All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 development effort on Mr. Gutierrez's part. Relative to the other regulatory takings cases that we have, in fact, litigated, including those that we've prevailed in, this should be an easily defensible case. The County's basic position is that the 2004 letter of current site conditions cannot be a final decision upon which a ripe regulatory takings claim can be based. So the crux of the County's argument is that you didn't actually try to do anything with this property. That letter is merely for informational purposes. It does not assign any rights. And furthermore, if you feel that it did, you, in fact, had an opportunity to appeal that administrative decision, but none of that, of course, was done. We are before you today because we are kind of in the preliminary stages of the litigation. Discovery is ongoing. We are teeing up a motion for summary judgment in this case. But this case has not been set for trial, and it probably won't be for, for a little bit of time. The question that we have before you today is what to do about the State's role in this litigation. There is a, a very viable claim that we could make against the State in a third party complaint. The wetland regulations at issue are, in All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 fact, ones that were required for the most part by the State for the County to adopt. But furthermore, the Complaint itself acknowledges that, you know, they tried to obtain a fill permit from the Department of Environmental Protection and they failed in, they failed to obtain that permit. They were turned down by both DEP and the Army Corps of Engineers. We can't, we could elect a third party, the federal government in, as well, but we can't do that. COMMISSIONER KOLHAGE: Well, let me stop you there, please. Were they turned down by those other agencies based on how a determination (inaudible). THE COURT REPORTER: I'm having a hard time hearing. COMMISSIONER KOLHAGE: I'm sorry. My question was, did those agencies turn down his request for a fill permit based on our analysis and review which said it was a red flag wetland? MR. HOWARD: There's some questions to exactly what, whether the State conducted their own analysis, because the KeyWep is a joint scoring program. It was a program that we jointly devised in terms of you getting the scores. There, we're conducting discovery because I think there's some question as to whether All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West i A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the State actually conducted their own review, and that's something that we haven't gotten to. But that is certainly an allegation in the Complaint, is that, you know, based on only Ralph Gouldy's determination and site visit, that the Department of Environmental Protection, as it's statutorily required to do, coordinated with or consulted the Department of Community Affairs and it was the Department of Community Affairs that objected to the issuance of the permit. However, what is very clear is that in this process Monroe County was completely out of the loop. We had no, we made no comments on that application for a fill permit whatsoever. I don't think at the time we were even aware that Mr. Gutierrez was seeking a permit. So it's a State permit application, and it was a State decision. What they based the decision on is still unclear, but the County didn't have anything to do with that decision - making process. COMMISSIONER KOLHAGE: Well, if it's not clear, then you don't know whether the County had anything -- MR. HOWARD: No. It's clear that we didn't have anything to do with the actual review of the permit application and that we did not comment on the permit application. The question that I have is whether the All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 State actually at some point went out and conducted their own site visit and, you know, agreed or disagreed with the wetland score. That's discovery that we haven't been able to get at. The State's not yet a party. And kind of, I think, the decision that we'll reach today will help me, inform me on how I go about doing that. But that's the, you know, the allegation is just that Mr. Gouldy, you know, that the County applied the joint scoring program and it was based on that determination that the State agencies rendered their own independent decision. COMMISSIONER NEUGENT: Well, do they have an obligation to make their own determination based upon their own information? Because I'm kind of like Commissioner Kolhage, that if they use our criteria in a determination, then I don't know if that implicates us in the -- MR. HOWARD: What, you know, as I understand the process, if you are applying to DEP for a fill permit they generally do conduct their own field investigation and they do not just rely on an investigation that's, you know, done pursuant to a landowner's request for the County to render, you know, this sort of advisory letter on what the site All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 conditions are. They can, in fact, whether they always do their own investigation, they don't always do their own investigation, but certainly statutorily they are, it's their decision. They are entitled to go and conduct their own investigation. They can certainly say, well, you know, according to, you know, our review we do not consider this a red flag wetland although the County may. It's, you know, perfectly acceptable to have two different, you know, opinions of, you know, what type of wetland exists. COMMISSIONER KOLHAGE: Can I ask a question? If you determine during discovery that our review and designation of that as a red flag wetland which we reversed later on was part of their consideration for denying the permit, where do we stand? MR. HOWARD: For, for purposes of the issue that would be before the court, it's really, that issue is kind of a sideshow. The resolution at issue would not dictate the outcome of this litigation. Because our position remains the same. You merely asked for the County to give you an advisory opinion of what the habitat type was. You received only a letter of current site conditions, which plainly states that this is for informational purposes only. It does not assign, you know, any rights, you know, for the All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 12 A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 property. And that's what Mr. Gutierrez got. He didn't ask to do anything with the property. There was no further -- this didn't go beyond Mr. Gouldy. He was the only staff member by virtue of the request that weighed in on what the habitat type was. But Mr. Gouldy is a biologist, and he made a determination of biology. He did not determine the overall development potential of that site. MR. SHILLINGER: So one of our defenses is you haven't done enough, Mr. Gutierrez, to perfect your claim. You haven't put in a building permit application. COMMISSIONER KOLHAGE: Okay. And he may not have satisfied all of his administrative remedies, as well. But if we get down to the point where the DEP or whomever at the State level says that we made a determination about this denial in coordination with Monroe County and it was based on that determination you made, I don't see how we can say we weren't a part of it. It just doesn't seem logical to me. COMMISSIONER CARRUTHERS: But he didn't even apply to us for a permit, right? COMMISSIONER KOLHAGE: That's not the point. MR. SHILLINGER: Well, understand that we're the only defendant here at this point, so we're claiming, All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 one of our defenses is they haven't named the State, which is an appropriate player in this decision. COMMISSIONER KOLHAGE: Okay. And that's another matter. MR. SHILLINGER: Right. So, and the regulations, the KeyWep was, the regulation that was being applied was developed in conjunction with the State, so it is, there should be some shared ownership of that. COMMISSIONER KOLHAGE: Well, I agree with that. MR. HOWARD: Yeah. I mean, you don't normally, liability doesn't normally attach to what information or what was considered in arriving at the decision. It usually attaches to the final decision, the governmental entity making that decision. It's very clear that the State was the decisional authority on that application for a fill permit and the County had, made no comment or had nothing to do, didn't even know that the application was being filed. Now, I would argue that even if the State stated in defense to an action, well, you know, we just relied on, you know, the County's, you know, determination that we are aware of that this was a red flag wetland, I would argue that that's not enough to, you know, get them out of, out of liability. COMMISSIONER KOLHAGE: To get the State out of All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West 14 A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 liability? MR. HOWARD: To get the State out of liability. Correct. I mean, they still, you know, they decided to use the County information based on a scoring system that they approved. So I don't think it really changes the game much. COMMISSIONER CARRUTHERS: It's hard for me to really see our liability here when he didn't even apply to us for a permit. I mean, so there's, it's like, it's just like an opinion. MR. HOWARD: Which the Department issues all the time. COMMISSIONER KOLHAGE: But it doesn't help that we issued an opinion at one point in time and then we issued a different one later. That doesn't help. MR. HOWARD: No, it's not, it's not giving us an ideal situation. But again, I think what Mr. Roberts would tell you is that, you know, whenever you go out and you do these field visits, I mean, in the letter that Mr. Roberts issued clearly it states that this is based on a site visit today, that conditions may change. And they do. We are, in fact, aware of occasions where, you know, a property is one thing one day and another another day. And that's just the nature of biology. So yes. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 COMMISSIONER NEUGENT: I'm not hearing that Gutierrez did any follow -up after the ruling by Gouldy. MR. HOWARD: Mr., what he did, in fact, this is where it gets interesting, he did file for a beneficial use determination, but what happened and according to his Complaint, that application was essentially abandoned because Mr. Mattson, who represented him at the time, did not diligently see the application through the system. And Mr. Gutierrez was an applicant. This was kind of like a class action application for a beneficial use determination, so to speak. COMMISSIONER NEUGENT: So he did not complete the beneficial use request? Either himself or through his attorney? MR. HOWARD: Correct. And, in fact, he filed a bar complaint against Mr. Mattson for what he, for what he claimed to be incompetence in Mr. Mattson's representation of him in the BUD process. But what matters is, for purposes of ripeness is that he did not complete the BUD process. COMMISSIONER KOLHAGE: What are you asking us to .. MR. SHILLINGER: Well, the strategy issue here is All Keys Reporting - Court Reporters - ( 305) 289 -1201 Locations in Key Largo, Marathon & Key West 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 we have not yet named the State as a potential third party. We have told them, communicated that to DEO, that we think that there is some joint exposure here, and that's what has prompted the discussion back and forth with this joint defense agreement that the State has proffered on these cases. I've spoken a little bit to each one of you about this, and essentially what a joint defense agreement is, is a written document that says we're going to jointly defend the disputes that have been brought against us collectively and then we're going to leave for a later date on the, how we're going to resolve the liability between us. And the devil is always in the details. Four of the last ten years the State has agreed to, assented to, allowed itself to be named as a third party defendant in these cases when they weren't named directly and then jointly defended with us. The current administration at DEO wanted to propose a different course of action where the County would defend it, DEO and the State would join in if they felt inclined -- COMMISSIONER KOLHAGE: They felt like it? MR. SHILLINGER: And then we would resolve our disputes at a later date through arbitration. We've All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 17 L+ 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 had some discussions with the governor's office. Our lobbyist, Dean Cannon, has met with the governor's general counsel specifically to say is this really the governor's position or is this the Department's position going off and is this the conversation you want to have at this stage of the game or do you want to try and find a more cooperative solution that continues the partnership that we've had for the last ten years? As of yesterday I talked to Mr. Cannon, and the word he got from the governor's general counsel was I know the DEO had said they wanted an answer by the middle of March as to whether we were going to have a JDA or not, but I'm calling off that deadline, we're going to look for some more creative solutions on how we can work together, so don't, tell your board that they are not under the gun to make a decision on the JDA as it was originally proposed, as it's been most recently proposed by the Department of Economic Opportunity. So the big picture question we need to look at is we obviously want the State with us defending these cases. How do we want to approach them in terms of what tone and tenor do we want to take? Do we want to continue the cooperative agreement that has produced All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 some, for the most part, pretty good results, certainly in Collins, Galleon Bay, the facts were dealt to us, we had an adverse decision in the appellate court, we're going to have to deal with that at trial, but for the most part we've had a cooperative relationship for the last ten years, or if, or do we want to take a more adversarial approach? COMMISSIONER KOLHAGE: Why would we change what we're doing now? MR. SHILLINGER: That's been my argument in the last several months as we've been doing this, is we've worked together so well, why, DEO, do you want to go in a different direction? And the answer I get is, well, they want to nail down the relationship and there is an interest in State government in avoiding litigation if they can avoid, you know, being dragged into litigation. You've dragged us into, you've made us the Area of Critical State Concern, you've helped us adopt these regulations, you have twisted our arm to adopt these regulations, and yet now you don't want to stand at us with the -- COMMISSIONER KOLHAGE: Well, not only that, but they have the authority, the governor and the cabinet have the authority to adopt the rules without our participation. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. SHILLINGER: Absolutely. Because of the critical state concern issue. COMMISSIONER KOLHAGE: Because of the critical state concern. MR. SHILLINGER: Right. COMMISSIONER KOLHAGE: I mean, I can understand they want to limit their liability, but why in the world would we want to agree to that? COMMISSIONER NEUGENT: Do we have a choice? MR. SHILLINGER: Well, the choice that was posited before the most recent news was to tell us whether we're going to enter into this JDA or not, and if we didn't, the State was going to instruct its lawyers to just defend the State only and not work cooperatively with us to jointly defend these cases. COMMISSIONER NEUGENT: Bob, it's pretty clear the philosophical difference between previous administrations and DCA and DEO and this administration is about as clear as clear can be. They're property rights, they're pro development, and the governor didn't even know what an area of critical state concern was when he took office, and they distributed a hundred, from out of the air, transient units for the City of Marathon. We're dealing with different people, and there's, if you've been paying All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 attention, indicators every day that they're not going to involve themselves in situations like this. That's my opinion. MR. SHILLINGER: Right. I would just remind everyone that the partnership agreement that started in 2004 with Secretary Castille and was approved by the governor and cabinet in a meeting was under Governor Bush. So it's not, you know, it wasn't a Governor Crist, who is now running for reelection, type of situation. It preceded that. So acknowledging your read on the administration is correct. It's just it's a long- standing -- COMMISSIONER NEUGENT: Not only the administration, but under Jeb Bush, and you knew Jeb's philosophy as well as I do, and it was trending in that direction, and the legislature completely, you can even shoot a gun in your backyard based upon legislative actions. So it's property rights. And this administration and the legislature is, I can see them continuing to drift away from involving themselves in situations like this. COMMISSIONER KOLHAGE: Yeah. And, by the way, Mr. Cannon was instrumental in the change that took place between DCA and DEO. MR. SHILLINGER: Yes. But what he does bring to All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the table is access to the governor's office and -- COMMISSIONER NEUGENT: That's what lawyers do. They create problems that they can get paid to clear up. COMMISSIONER KOLHAGE: Well, that's fine, as long as we know what he's doing with that access. That's another issue. MR. SHILLINGER: That's another issue. But in terms of talking to you today, you know, we can't make any definitive decisions today, and I don't actually have a final joint defense agreement to put on the agenda to approve. But what I want to get is some general direction from you as to we still want to maintain a cooperative relationship with the State in defense of these cases, I'm assuming -- COMMISSIONER NEUGENT: At least until this session's over with. MR. SHILLINGER: Well, as long they're willing to jointly cooperate and participate, correct? COMMISSIONER KOLHAGE: My opinion is we ought to continue doing exactly what we're doing right now. MR. HOWARD: The only problem, I got to speak from the litigation end, I'll try not to get into politics, there's this uncertainty with respect to this agreement that we may or may not have with the All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 22 A A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 State, and we can stick with that for a while, but what is moving forward is the litigation, and, you know, normally the status quo would be that we would file this third party complaint that I've drafted, and we aren't filing it, but the litigation is moving forward. So just so we're clear that, you know, litigation isn't being stayed because we're trying to figure this out. It's important to note that. COMMISSIONER KOLHAGE: But the current situation is that you would file that? Right? MR. HOWARD: I wouldn't say the current situation is that we would file it before -- MR. SHILLINGER: In past situations in similar cases we have filed it. COMMISSIONER KOLHAGE: Well, then, we should file it. MR. SHILLINGER: All right. Well -- COMMISSIONER KOLHAGE: That's my opinion. MR. SHILLINGER: That's your opinion. And do we want to take that approach at this critical stage, or do we want to wait a couple of months before, and let the framework for how we're going to go forward be settled before we actually go ahead and inflame the situation by filing a third party action at this point? All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 COMMISSIONER KOLHAGE: I'm not inflamed. Are you inflamed? MR. SHILLINGER: I'm not inflamed. But I can see the receiving end of the third party complaint would be inflamed. COMMISSIONER CARRUTHERS: Well, to me in this particular case, I don't see how -- COMMISSIONER RICE: There's fifty million reasons. COMMISSIONER NEUGENT: Absolutely. COMMISSIONER CARRUTHERS: I don't see how -- COMMISSIONER KOLHAGE: What has that got to do with this issue? Let's tell the public how it works in Tallahassee. COMMISSIONER RICE: Well, you all will run out there and do that, and there goes the fifty million reasons. COMMISSIONER KOLHAGE: I don't believe that for one minute, David. COMMISSIONER RICE: Well, I'm sorry. We disagree. COMMISSIONER CARRUTHERS: So you think that we're being held hostage on the wastewater? COMMISSIONER RICE: Yes. Not only wastewater, but there has been a very strongarm element to this All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 through the last almost year. MR. SHILLINGER: Yeah. It's been about a year. COMMISSIONER RICE: Since we had a first meeting in Tallahassee. COMMISSIONER KOLHAGE: Is anyone saying to you, we will hold up the fifty million dollars if you don't sign this agreement? MR. SHILLINGER: No. MAYOR MURPHY: No. They won't say it, Danny. They'll just do it. COMMISSIONER CARRUTHERS: Well, that certainly erodes any sense of integrity for this administration or Tallahassee. COMMISSIONER RICE: Well, let me ask a question. Bob mentioned two months delay here. In two months the legislative session will be concluded. Can we wait two months without any harm? MR. SHILLINGER: Yeah. The only harm that is, the only potential harm that's being done is we have a third party demand in this case. And we think we have very strong defenses in this case. We may not need them. COMMISSIONER CARRUTHERS: Well, that's what I was going to say. I mean, I understand what you're saying, and people should be, I guess maybe I'm All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 idealistic, but I think you should do the right thing, whether or not this issue impacts another issue. But unfortunately, that's not the way things are happening right now. But regardless, this case, I don't even know if we need to have State involvement, because it seems to me that he's got no leg to stand on. COMMISSIONER RICE: Exactly. MR. HOWARD: I was just going to say that. If there's any case that, you know, this is the one to allow this issue that, you know, sort of remained -- MR. SHILLINGER: This is not Collins. This is not Galleon Bay. MR. HOWARD: Right. MR. SHILLINGER: This is a much smaller, much more narrowly focused single lot owner temporary taking where we think he does not have great arguments to raise, so -- COMMISSIONER KOLHAGE: But you just got finished saying that you think you have a good case but where the State should be a third party? MR. SHILLINGER: Yes. If we're liable, they should be, as well. COMMISSIONER KOLHAGE: Then that's, I think that's how we should proceed. COMMISSIONER CARRUTHERS: If something happens All Keys Reporting — Court Reporters — ( 305) 289 -1201 Locations in Key Largo, Marathon & Key West 26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 such that we are found liable, can we then engage the State in a damages, in the damages portion? MR. HOWARD: Yes. COMMISSIONER CARRUTHERS: Okay. At the end? MR. HOWARD: Yes. They're, I mean, in the past they have said if we're going to be in, we want to be in in the beginning. Yeah, absolutely. The reason we did the third party complaint is because we all agreed, you know, we appreciated them at the table and they wanted to be at the table. They didn't want us, you know, defending or, you know, mucking up these litigations and then, you know, after the fact saying, oh, we need, you know, ten million dollars. That's why we had the arrangement to third -party them in. That was the procedural vehicle to get them at the table to help us with these cases. But yeah, we could certainly after a judgment, you know, seek contribution from them. COMMISSIONER KOLHAGE: When you say seek contribution from them, you mean outside of the court? MR. HOWARD: Well, I mean, that's always a possibility, sure. But I'm saying in the court we could file an action against them. COMMISSIONER CARRUTHERS: Because there are two parts to this. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. HOWARD: Right. COMMISSIONER CARRUTHERS: There's first the personal liability -- MR. HOWARD: Right. COMMISSIONER CARRUTHERS: -- and then there's the damages. So even if by some, you know, complete miscarriage of justice we are found liable, we can engage them, then, for the second part, which is the damages? COMMISSIONER KOLHAGE: After a final judgment finding that the County is liable? MR. HOWARD: Yes. COMMISSIONER KOLHAGE: That would be court approved? In other words, they would be court ordered? MR. SHILLINGER: Yes. We could file an action for contribution, which is a specific type of claim in court that says I've been ordered to pay money, I shouldn't have to pay all of that money, you should contribute to that, State. That's what an action for contribution is. COMMISSIONER KOLHAGE: Okay. Now, one more question. The agreement that they're asking us to sign, we would get down to the end and then settle our dispute by, not through court order, but through All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 arbitration? MR. SHILLINGER: The document that was last produced by DEO said exactly that, was that we would agree not to file against them but we would toll our claims against them and resolve them by arbitration. I pointed out to -- COMMISSIONER KOLHAGE: That's outside the court? MR. SHILLINGER: That's outside the court. I pointed out to the DEO general counsel that under the current interpretations of the Sunshine Law if all I'm proceeding on is an arbitration claim against the State and there is no pending litigation, I have no ability to talk to you in closed session like we are doing today. We have a pending claim right now. But if there's a final judgment and then -- COMMISSIONER KOLHAGE: We're done. MR. SHILLINGER: Then the closed session goes away, the opportunity, because the statute only allows a closed session for a litigation, and the AG has opined that arbitration does not fall within that section of the statute. COMMISSIONER KOLHAGE: And what I want to point out is, is that the future of this could mean a lot more than fifty million dollars which will fall on the backs of the taxpayers of this county. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. SHILLINGER: Yes. The issue that's bigger than this case, bigger than everything, is how do we deal with the ROGO end game. But we've got to deal with this case, we've got to talk today in the context of this case, because that's what we're here under. COMMISSIONER KOLHAGE: Well, but you're asking about the potential agreement. That's why I made the comment. MR. SHILLINGER: Yes. Right. But I want to at least keep it tied to this one. So am I hearing a willingness to continue to work cooperatively the way we have worked in the past ten years? That means that we would bring them into the case and have them help us defend the cases in the early stages when liability is being contested. COMMISSIONER NEUGENT: How are you bringing them in? MR. SHILLINGER: Well, how we could -- COMMISSIONER NEUGENT: After they've said they don't want to be in it? MR. SHILLINGER: Well, understand, it's a moving target here. The DEO, their last draft said you would stay you claims until the end and then bring us in through arbitration. The governor's office communicated through Mr. Cannon that that is not the All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West a A 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 final word, they're open to other discussions and other ideas, and so you don't have to answer -- COMMISSIONER NEUGENT: So why don't we wait until we get those answers? MR. SHILLINGER: Okay. But in shaping those answers and trying to deal with this case, are you, am I hearing support for a continued approach the way we have done it, where we do bring the State in and they help us defend the cases up front? COMMISSIONER KOLHAGE: That's my approach. MR. SHILLINGER: I'm just getting head nods here. COMMISSIONER RICE: You mean naming them as a third? MR. SHILLINGER: Naming them as a third party and then staying the fight between the State until we had resolved the dispute with the landowner. Because that's how we currently have it, we've been defending these cases, albeit in a unwritten gentlemen's agreement between the County and the State. There are written documents that articulate this in the partnership agreement that says the State will help us defend, but it's not written to a binding contract that we could then enforce on the other. COMMISSIONER NEUGENT: It sounds like you answered your own question. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 31 1 2 you. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 N61 MR. SHILLINGER: I need to get some input from COMMISSIONER NEUGENT: Well, if there's not a binding contract and agreement, it would be like trying to bind future county commissioners. MR. SHILLINGER: Well, that's, I think what I would want to have is at least some written agreement that reduces the process for this, but I want to take your temperature as to how you'd like to see that happen. Do we want to work cooperatively? I'm getting yeses as long as it's not a poke in the eye. COMMISSIONER CARRUTHERS: That's what I was going to ask you. If this is not a poke in the eye, then let's proceed on that. MR. SHILLINGER: All right. I have the general direction that I think -- and obviously I'm going to have to bring something back to you. COMMISSIONER NEUGENT: No poke in the eye. MR. SHILLINGER: No pokes in the eye, but work cooperatively, as long as we can protect ourselves with the, for them participating in the defense of the cases up front. COMMISSIONER KOLHAGE: Let's try to spread the liability of these issues, this issue, this case and the future cases away from the taxpayers of Monroe All Keys Reporting — Court Reporters — ( 305) 289 -1201 Locations in Key Largo, Marathon & Key West 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 County to the State of Florida who required us to be in this position in the first place, and let's do it jointly and cooperatively. COMMISSIONER NEUGENT: And I'd like to add to that the reality of what's taking place here, one of the biggest issues that we have for being in an area of critical state concern was wastewater. I suspect if we're fortunate enough to get this next fifty million dollars that there's going to be, and what's left to do in our work plan, and the legislature could just say on their own, you're out of here, and the cabinet, the governor and the cabinet can say you're out of it, we're cutting our ties with you guys. So where does that leave us at that point in time on the big ticket issue items that are somewhere down the road? MR. SHILLINGER: Right. Current law envisions a post- designation world, de- designation world, where the State will have, I think the language is the same liability it would have while we were designated up to twenty years after the designation is lifted. That language was put in the 2006 or 2007, in the de- designation bill that went in. It's in one of the notations at the end of the Florida Keys Protection Act. So under current law, that's what it says. All Keys Reporting — Court Reporters — (305) 289 -1201 Locations in Key Largo, Marathon & Key West 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Now, as you all know, they're a legislative body. They can change the legislation and take that, at least that statutory basis, out. We could always still have our claims that they're the ones who led to the result, and if we get to that point of where they have de- designated us and they are no longer cooperating, then the gloves are off. COMMISSIONER NEUGENT: But the other side of that coin, if that were to happen, we're in control of our own destiny at that point in time from a decision - making standpoint? MR. SHILLINGER: Yes. I think I have the direction, and I'll recapitulate it just to make sure that I have it, is to look for solutions that are cooperative in nature, not a stick in the eye, but which work on a joint defense of these cases, particularly like this one and others that come up where the liability is appropriately apportioned and attempts to shift as much as possible from the County to the State. COMMISSIONER KOLHAGE: Let me ask you a question about that. Does all of that mean that you will or will not file to bring the State in as a third party in the Gutierrez case? MR. SHILLINGER: What it means is I would like to All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 have the process, get an agreed process with them before I would third -party them in. COMMISSIONER KOLHAGE: And then are you going to come back to the County and tell us what that is? MR. SHILLINGER: Yes. And have you approve -- COMMISSIONER KOLHAGE: Okay. Because everybody's got to bear in mind, once we get outside of the judicial part of this and we agree to something at arbitration, forget it. We're done. MR. SHILLINGER: Okay. I think I have the direction. Madam Mayor, can we close, unless someone else has anything to say to give us direction, can we close the closed session? MAYOR MURPHY: The closed session is now closed. (Proceedings concluded at 2:45 p.m.) All Keys Reporting — Court Reporters — ( 305) 289 -1201 Locations in Key Largo, Marathon & Key West 35 1 2 3 4 5 6 7 8 9 10 11 C E R T I F I C A T E STATE OF FLORIDA ) COUNTY OF MONROE ) I, Susan L. McTaggart, Court Reporter and Notary Public, State of Florida at Large, do hereby certify that I was authorized to and did report by stenotype the proceedings in the above - entitled matter, and that the transcript is a true record of said proceedings. Dated this 31st day of March 2014. Susan L. McTaggart, Court Reporter 12 13 14 15 16 17 18 19 20 21 22 23 24 25 All Keys Reporting - Court Reporters - (305) 289 -1201 Locations in Key Largo, Marathon & Key West