Upper St. Johns River cut out from the existing local sponsor and they had
no, as far as the State is concerned, further responsibility for that, then
we would have to have some substitute body to serve as a local sponsor
capable of fulfilling these obligations that I have enumerated. Otherwise
I can't spend another nickel up there even in planning or anything else.
if the State is convinced that fund situation will remain static and
can be cut down to where some way or another we can come up with say $100
thousand to run the St. Johns station. That would satisfy your requirement.
The problem the ad valorem tax is a long range thing, but I would think that
the state could work out something with you.
Well, I think there are some legal questions here.
Well, you've got a lawsuit pending right now in St. Johns which involves
the hold and save provision in which a man is suing for damages he claims is
from flooding from that Taylor Creek structure. We don't know what the result
of that will be. Actually the worst burden you have under the local cooperation
is really the hold and save because it's an unknown burden. You don't know
what it'll cost you. That is your biggest problem.
We intend to leave that with you, Bob.
Thanks, but we don't want it.
But we really do have quite a bit of time before any additional monies
will be required for the Upper St. Johns unless somebody sues somebody, and you
aren't doing anything now so the status quo is going to remain. We do have
Speaker of the House and then at that time, I served on the committee that
made Jack Shreve chairman of the committee that developed and passed the bill.
I'm very interested, or else I wouldn't have done what I did in the beginning -
the Governor wanted to fool with the thing. And there was one guy over in the
Senate who was going to fiddle with it and nobody was really grabbing it up
and moving with the program; so I started the program. I don't want anything
for it. Maybe I made a mistake but I just want to let you know that I'm really
interested and I think that it's a really analytical problem. How, if we have
to take the "bull by the horns", we'll move in the direction to do it, but
I need some input, I gotta help solve you people's problems. I'm going to
do the best I can and help you solve your problems. I think all of you generally
agree that we've got a pretty good law here if we could just solve that ad
valorem tax problem, then maybe if we move in that direction we'll solve the
problem. I think that we can do it if we all keep our cool and ride along and
see where we really are. I've only had a chance to be at several meetings -
and we've got the St. Johns Water Management District going and I knew we had
the ad valorem problem even when we started with the bill originally that
that was going to be one of our major factors. So I just think that if we all
sit here and work together we can hopefully solve this problem for everybody
in the state and I think that's the way to look at it. We can't be jealous in
certain areas that we have, regardless of what happened in the other part of the
state we're going to have to look at it that way --which is what's best -
I might be jealous of certain things but I've got to overlook that and do
what's best for the people.
Thank you very much. I think we've gotten out on the table now maybe
not all the problems we're facing, but a nucleus of them. Now, I'd like to see
difference as to whether we should have ad valorem taxes to support the
activities or not. Now, we use our ad valorem taxes for a great deal more
things than the Four River Basins Project. And a substantial portion is used
in regulatory activities and the gathering of data and well drilling permits
and various other things. And we suggested at that time, that maybe the thing
to do would be propose a Constitutional amendment that would authorize a levy
of ad valorem taxes up to one mill for water management purposes state-wide.
Now, it seemed on the fact of it that this is kind of stupid, to suggest a Con-
stitutional amendment to authorize the levy of tax. But on the other hand, if
it is not increasing the tax in Southwest and Central and Southern, you've got
a very large segment of people that hopefully would support this. We made the
statement at the time that if we'd pass this, or start promoting this, that we
would at least want the support of the three new districts, their boards, where
they couldn't certainly speak for their voters, but at least their boards, who were
enthusiastically in favor of this even though they never levied a dime, but to
have the authority to levy such ad valorem taxes they felt would be appropriate.
This has not been pursued because it has not been embraced with a great deal of
enthusiasm on the part of the three new boards and it's, as far as the two existing
boards, they have no real purpose in doing this because they already have such an
ad valorem tax. But I would also hope that if anything is changed, that it would
coincide with the fiscal year from the ad valorem taxing standpoint, the Octo-
ber 1, date rather than July 1, because this transfer on July 1, gives us another
hiatus as far as support from the taxing standpoint. And another thing that we
put into law this last year (year before last) recommended that the legislature
put it in.that it was a proper expenditure of funds of both Department of Natural
Resources and existing districts and the new districts to use what funds are
available in actually putting on the ad valorem tax referendum election, so we've
got the authority to do that. I don't know of anyone who has initiated many efforts
toward an educational program to bring any of this to a vote at any point.
I have a copy of our Resolution #33 that was passed April of 1963 to the
assurances of the Corps and Colonel. Our next step, of course, is to ask you
immediately to set the wheels in motion so that as of July 1, we will be released
of any of the responsibilities insofar as it relates to the Eastern tip of the
levee of the Green Swamp, and to structures in the Oklawaha Basin because with-
out this release, we are placed in a very peculiar position of having a legal
obligation and still being precluded from spending the ad valorem taxes funds
in that area because it is no longer a proper expenditure for public funds.
I think that those documents will have to be revised for several reasons-
the federal government is changing its fiscal year; in FY '76, so there will be
five quarters in FY '76. So in September, will be the end of the fiscal year.
I think there is little verbiage in there having to do with the fiscal year and
so forth. A lot of policing up will have to be done on these documents contingent
upon what course the State takes in regards to these areas.
I think that before we leave the question, of in what form the liability is
assumed, you must recognize the fact that with the proof of financial responsibil-
ity demonstrated by the local sponsor, it then remains the discretion of the
local sponsor as to how they would appropriately plan for the exigency of having
to meet this liability. In our case, we have reserved funds and we also have
What if you lost a structure or something?
Let's cite a couple of specific examples, and our counsel, Bob Grafton,
is here. He can answer any questions about those. We've had some lawsuits filed
against the federal government and we've had to hold and save the federal govern-
by the millage that goes for all the district and so it's going to make a certain
amount of difference to the areas being transferred and certainly they are going
to have some responsibility that they have not had before. Quite frankly, I was
surprised that there was that much tax revenue coming from that area that was
to be transferred out, and this is going to be picked up somewhere. Up'until last
year, we (Southwest and Central and Southern) never received a penny from the state
for regulatory activities for any of these functions and this past year, of course,
there was the $500,000 that was authorized for each of the five districts. This
is the first time; we don't know what the legislature's inclination will be this
next year, but it certainly is inadequate to carry on the regulatory functions
that are imposed on us all that were passed and as Jack has expressed, our board
is concerned; they've been levying taxes now and on the firing line for some
thirteen years and would not like to see this transferred unless it's done respon-
sibly and unless these interests are protected. We're yet to devise a means of
sure funding we'd hope that the legislature has a crystal ball that they could
come up with or some idea how these transfers should be responsibly made.
One thing, on the behalf of our board, Buddy, how do you feel in reference
to this suit? What is your timing? What would you expect to get in the way of
answers from the court?
Well, we filed this suit and it was difficult at first to find a defendant
because people aren't interested in litigating for the exercise of litigating.
We also are aware that some of the opponents of the water management districts,
ment and we go into court and defend the federal government and our taxpayers
are liable to the extent that that court case is settled and any type of monetary
rewards that are paid and over the 25 years that we've been in business, we paid
several. So we actually budget and carry, in our reserve accounts, specific
reserve accounts, monies for these purposes, which are raised from ad valorem
taxes and it is a considerable amount of money. We feel, we also have reserve
accounts for emergencies such as any project expenditures. .. Suppose we lose a
pump station. We have a half million dollars in reserve. This is in special
accounts. This question about liability is broader than simply to say that we
have a resolution on file. The taxpayers and the governing-board members them-
selves as representatives of the taxpayers, are liable. In the case that we
have a court settlement and we have to come up with the money to settle it or
in the case that there is some damage or emergency, we have to meet these re-
quirements of the local sponsor and you must recognize that we budget and levy
a village only once a year and the operations of an entire fiscal year...
and you don't go back to the taxpayers in the middle of the year to raise money.
So there is some fiscal planning that has to go into this to assure the responsi-
bility. And as the district gets bigger, and the works become more valuable,
monetarily, the responsibility increases monetarily, so you have to increase
these funds. What we've done is fiscal planning; be sure that we keep pace with
the increased potential monetary impact of this responsibility on our part and
use the tax funds to do that.
Well, to what Jack said, back up we paid one judgement of $150,000
dollars, against the United States, and there is presently pending one in the
federal district court; the judge has assessed $480,000. that's on appeal
right now, but that gives you an idea to what you are up against on this hold
I think that we are in the process of doing that, Buddy, we've had one recent
turn of events that I think is a little more optimistic and not so pessimistic;
our board in general feels that to undertake such an enterprise, district-wide,
would be an expenditure of funds that wouldn't pay off in time and energies. And
that's a very genuine feeling on the part of them and they won't be very encouraged
to do that even if it is reasonably correct. Looking maybe at a new view, that
we must have in regards to these large public works projects, in the future,
where are we. .. where are we going. .. that sort of thing, we have been
meeting on a number of occasions with representatives of the City of Jacksonville,
specifically, Bio-Environmental Services, a Division their Health Department
and that's not the exact name of it; but it appears that at our next board
meeting, that the City Council of Jacksonville will have provided funds from its
own revenues to enable us to jointly begin efforts in learning some of the things
"that we need to learn and spoke about earlier; enable us to establish regulations,
and to learn where we are in regards to wells and what's happening to water
levels and intrusion of salt and that sort of thing and directly lead to us being
in the position of being able to contribute parts of the State Water Use Plan
which we all have the obligation ultimately to do. This would be in a thing that
the figures are in order of fifty of sixty thousand from them and the same from
us. This may be one door that may be opening alternative avenues to the ad valorem
tax device, but it does very clearly indicate that I'm having to be thinking :'
about projects at very much less cost than what we've been accustomed to. I be-
lieve that by the next board meeting, we will have a complete package on this
between the City of Jacksonville and our board. Maybe that is a little door
that is opening a little bit.
We have another area that is involved in transfer that is not as demanding
from the funding standpoint as the two we've been discussing but. the
if we can come up with some recommendations to put out of here for us to con-
sider to make a report to you in the legislature of things we'd like to see
Mr. Sanders, maybe you'd like to hear from the people in Manasota ..
Yes, Sir, one of them just walked in one of the Director's down there.
I don't want to put her on the spot. I tell you, Mary, I just told them that
your budget request for next year was in the neighborhood of $100,000 and we
did have a problem of you being financed by general revenue across the line
and other counties are paying taxes and this is some of the difficulties that
we're facing at the present time.
Let me ask a question; there were some very fine activities in the area
of water management prior to the formation of the Manasota Basin in Manatee
and Sarasota Counties in limited areas, there have been activities at various
times. These were funded in the past by the county. Has any attempt been
made or effort or have you had any contact with the county in an effort to
continue to support any of your activities and what has been the response.
The problem right now is that the board is so new that it's a political
situation of everyone trying to figure what's going on. The, I think that the
counties, well, Sarasota County, is, I think, probably more receptive than
Manatee County to this general kind of problem, but they have been sort of
waiting for us to come to them and ask for money, but we have not gone as a
board with a proposal to them for something just because we've been, I would
say, only within the last meeting, or two that we have felt like a functioning
time to work with the problem as it exists today without additional requirements
on the ad valorem.
We're spending a lot of engineering money and federal money.
Yes, but that's in Jacksonville and you've got the people, anyway.
Mr. DuBose, do you have anything you'd like to suggest at this time?
Mr. Helton? Anyone else have any comment they'd like to make?
I know that this meeting wasn't called specifically to talk about the
wide range but more to focus in on the problems with the federal government
but I think my overriding concern in this whole thing is that the original
intent of the Water Resources Act not be lost in the arguments about the
transfer. I think it's critical to the state that the water management districts
be funded to continue and progress in their planning and regulatory activities
without regard to these public works projects and I hope that so much emphasis
is not placed on this transfer problem that the larger problem is going to be
overlooked. It's critical that the water management districts, now.that
they've got a start, with all the indications we get from the Chairman of the
House Appropriations subcommittee who is deliberating water management requests,
there's not going to be much money available this session. I don't think
anybody argues with that and I hope that the issue doesn't become so clouded
that as a result of an inability to solve this problem, we lose the larger
problem which is to continue to fund these new districts so they can move
ahead in the other thirty-five counties of the State of Florida that really
have not had an opportunity to have a regional approach to water resources.
and there are those sitting on the sideline waiting utnil July 1, to go in
and challenge the taxing authority, and once it's lost, it can't be re-constituted
because of the constitutional provisions. So we finally prevailed upon Hernando
County to defend. Hernando County is a logical county to defend because there
are three different basins within Hernando County -portions of them, not all of
them. No area will be added to Hernando County and none will be taken from it,
but the amount of taxes that Hernando County is paying will be changed from an
equitable figure as far as transfer out of territory and they are currently paying
in Hernando County a relatively small county, about $138,000 in taxes for the
water management district. Now, we don't know how quickly this'll move. Their
attorney is going to be defending it and there probably will be others involved
in the suit. We hope that we will have a decision very early from the Circuit
Court by then we think that it will not be sufficiently binding if we did not
take it on up; and hope to get a certified question to the Supreme Court, and
then move it with haste and give Sanction to the decision that was given by the
Circuit Court. We think that we'll be successful, but we're not sure.
Is this something that you anticipate having prior to the legislature meeting?
I would hope that by the time the legislature meets that we would have a
decision from the Circuit Court.
From the Circuit Court, you wouldn't anticipate that you could get it certi-
fied by this time?
I've got a question, now we also are having our pleading being reviewed by
the Attorney General's Office who will come in on this, to participate in this
suit as well as the State Attorney for that area and he will be participating on
I assume that the date we're hitting for is January, July 1, 1975, as the
date established by the legislature. Is that correct?
It appears to be, that while we are all here today, that we have a major
problem on this fiscal situation. I know, if I were a tax payer and paid sub-
stantial amounts of money in the Central and Southern Florida Flood Control
District, and saw because of a switch in the line we'd drawn, it all go up to
St. Johns, and we turn over a whole lot of assets, be it whatever portions we
paid in, I might look askance at it. Unless, the Upper St. Johns was of a mind
to tax themselves and I know that there is that, but I'd just like to ask Dr.
Marshall and it may be too early to tell, but are'the people in the Upper St.
Johns willing to impose a tax on themselves to carry out what is necessary?
I think the answer to that question, Senator, is very few pressed areas,
in counties, let's say, there might be a slim possibility; but in the greater
number of counties, this is highly unlikely.
So then, in fact, your tax basin in the Upper St. Johns would probably not.
pull through unless the legislature decided to pick them up and carry them on
ART MARSHALL :
Maybe out of all of it, the way I think about is, Senator, is that we all
know the well is drying up and the State is having losses in revenue. The fed-
eral government apparently is about to cut back on its income; individual citi-
zens are finding the sae thing and yet we are continuing to face the fires of
Waccasassa Basin is scheduled to go with the Suwannee and we have Mr. Woodard
who is the Executive Director of that Suwannee District, and I'd like to hear
anything that he'd like to say at this moment.
Fortunately, we don't have the public works projects and what-have-you
in existence in the Suwannee. We can envision no particular financial problem
with this transfer. We've been in touch with Southwest and we envision no par-
ticular problem of magnitude involved with the Upper St. Johns and the Oklawaha.
Quite frankly, if the problems are resolved there, they will resolve themselves
in the Waccasassa Basin. We have the basin difficulty that Mr. Blain mentioned
and the preservation of the ad valorem taxing authority with the Southwest
District, should they transfer, that the suit in an attempt to resolve this
problem. If Southwest can be assured of their integrity, that transfer can
take place without any particular difficulties. As I say, Mr. Sanders, I don't
envision any problems of any magnitude in the Waccasassa Basin.
Mr. Feaster, was the Waccasassa Area the area we discussed the hydrological
aspects of whether or not the lines split a watershed there?
Something along that line. That's not exactly it, Mr. Vaughn, but I
believe that this has been in a Hydroscope or coming out. We're getting ready
to do some studies with the U.S. Geological Survey to determine how much water
can be taken to coastal springs from the Withlacoochee River and our staff has
been working on it. In this study, it has been determined that a major flow into
the Withlacoochee River's Rainbow Springs. this has always been known. But
the water coming out of Rainbow Springs, almost 70% of the flow of the.Withla-
coochee River which will remain in our district originates in this part of the
district, which will be transferred. This is a major concern to us. One of the
Now, are they continuing to regulate, for instance, well drilling?
Is that a county activity still?
And that has not yet become one of your functions.
So you've got county activities that are ultimately, I would assume,
would be taken over by this basin, or by the district and the basin becomes
a part of and there are some other activities. They've had some flood plain
studies that the Corps did in Manatee Co., for instance, that are very good.
So they've had activities in these two counties and they, I'm sure, are less
than enthusiastic about becoming a part of another district because they hydro-
logically are it's a fairly good unit, as it is today, and they look at it
with a certain amount of success and look at it and say why should we go any
further, we can do it right here at home.
I don't think that that is totally fair to say. I think that there are
many people who feel that we belong under Southwest.
Oh, I think so too, but I think that there is a logic to those who are
less than enthusiastic about change or apprehensive.
That is their argument, yes, for those who are apprehensive. But there
are many others who feel that we logically belong under Southwest.
I think that's critical. I hope these two things don't become so intertwined
that we lose that larger picture because I think it's important to us now that
we've got the law in the book to go ahead and implement it, with the total
state's problems always as the overriding consideration. The small problems
of the subbasins being transferred they're problems and need solutions -
no questions about that but by the same token we need to move ahead in the
other counties of Florida where we haven't had experience and involvement
in the water resources area.
Mr. Pridgeon, do you have any comments?
I'm just listening.
I think the problems have been thrown out real good this morning and as
I look at it all the solutions are going to take much longer than the couple
of months or so yet to work with. Where do we go from here? What more can
the water management districts be doing right now except carry out the intent
of the Legislature? What can we do?
You notice I'm not answering your questions.
Let me ask Colonel Lee a question. Colonel, we've got a law that's
going to transfer part of the district out on July 1, 1975; we've got an
agreement with you and we want to know how we get released under this agreement
on July 1 when we go ahead and transfer.
I didn't bring my counsel with me, but I think it is kind of a sticky
Certainly the intent of our board and others is not to circumvent the legis-
lative intent, but I think, but that as you've used it, is to do it in a respon-
sible manner as you said.
Now that money has to come from somewhere. The second thing that I have,
Charlie, is to Colonel Lee; you said that a local sponsor can be in a position to
make a cash contribution to hold the federal government harmless to operate and
maintain and enter in the relocation contracts and this type of thing. What
proof of a responsible nature are you going to require as a representative of
the federal government?
Well, in terms of financial responsibility, we want a financial statement
that we could analyze.
I understand. So you get a financial statement of a water management dis-
trict and the new district, for instance, this time, if I understand correctly,
had a large sum of $500,000 for operating and setting up their new district and
regulatory authority. They had little or no funds for operating or contracting -
no allocations for construction. How are you going to look upon this what
are you going to use as a "yard stick" for judging? At what point are they
financially responsible to accept the responsibilities that you speak of?
I think, other than what I've mentioned here, a statement of financial
responsibility which you can tie to some figures; on the other factors-there,
I think it is a judgmental factor. These contracts that we enter into as a
local sponsor there, are going all the way until they're approved at the Secre-
inflation, which I am totally satisfied are going to worsen not improve, and
perhaps out of this experience, we will have massive change in the way we're
doing things, and thinking about things. It's not something that I'm advocating,
I'm merely convinced that it is happening. I don't foresee much opportunity
in the long future for us to repeat the circumstance which puts us in the
strength that this one has. To put that in plain English, I don't think that
we're able to afford either financially or energetically, the construction and
operation. the kind of thing that is giving us problems now.
This is something that we have to face in the next few weeks; it is right
on us. Excuse me, Dennis, Mr. Vaughn was ahead of you.
What occurred as I was listening to this, what I want to say to Representative
Craig. I realize that several years back, the date of July 1, 1975 was set as
legislative intent to change; what do you think the reaction would be to a re-
wording of that that might say that in essence that as the problems that we dis-
cussed this morning were solved and by mutual agreement transfer; the transfer
would then take place rather than having a rigid lop-off date-type thing. Once
you get an answer to the suit and once you've established financial responsibility
to the satisfaction of the Corps, that these things the intent that occurs.
I kind of question the necessity in a way, in viewing these problems, by saying
"Barn", you're going do it this date. I don't know what that accomplishes.
Senator, let me say this. I'm not in mind to let the water management
districts determine when they are going to do it. To start with, however, I
might not have a lot of objections to extending the time another year.. I'm not
quite as pessimistic as you are, Dr. Marshall, but I think that if we put a lot
of time and effort and study into what you brought up and I realize that those
major rivers of the district, again that will stay in the district. The actual
water that gets into that system from the part of the Waccasassa Basin that will
be transferred. So we.do have major concerns hydrologically.
In other words, they've got the source, we've got the problem.
In addressing that particular question, we acknowledge underflow there,
and appreciate what we're getting out of the St. Johns, up at the other boundary.
Again, the Statute indicated basin divides on surface parameters and that was it.
We have not addressed seriously the groundwater underflow problem in the Withla-
coochee but we will admit that we contributed generously to Southwest.
We've got some hydrological problems along with some legal problems and
Mr. Blain's financial problems. I'm just trying to get out to you so you can
see where things are.
While Representative Craig is here, I thought I might take the opportunity
to make some clarifying remarks since myself and Don Morgan are probably the
only two people in the room who served on the panel that drafted the legislation.
And you've got to remember that when we were drafting this legislation, this was
part of the package which was pointed in the direction of giving Florida and a, .
leadership role in establishing a coordinated State-wide land and water use plan.
I:e did not pass the Water Resources Act of 1972 to determine who would cooperate
in a public works project. We passed the Water Resources Act of 1972 to give the
authority to the State to enter into the regulatory procedure to control the
destiny of its water resources. And secondly, to give the responsibility to
Well, would you feel that this is a feeling of your Board or are you
prepared to say?
We have never voted on it, never had a general discussion. So all I can
say that it's my feeling that the majority of the Board would want to go under
Southwest, but there has never been anything; that is just knowing personalities
and individual feelings. That is not to say that there have been some very
vocal people against it, but I think that if we took a head count, we would
come out for it.
I think that's true. I know that Mr. Blain has given particular thought
to some suggestions ways we might move. I want to ask him if, he would, he
told me yesterday he wasn't going to tell me but I'm going to put him on the
spot and ask him. Of course, he said that jokingly.
To sit up here and talk glibly and as long as I go around in circles and
don't say anything specific, I'm doing my job; but now when I start committing
my Board, and Board members are staring me in the face across there.
One would like to say something.
Mr. Hill is a Board member of the Oklawaha Basin and has been very active
participant on our Governing Board.
We have an Oklawaha Basin Board which I am chairman of and I'm also a member
of Southwest Florida's Board. Colonel Lee and I have been working on projects
here together for a while my area is, I agree, it should be.in the St. Johns
Basin there is no doubt about it. Our only concern is that the transfer occur
at the proper time with the proper funding. Nobody in my basin that I know of is
legal question because the project was authorized as a whole by Congress,
with your district set up as the sponsor; with part of it split off we're
looking for some local sponsor and without one forthcoming, I don't know what
the application will be.
Colonel, are you saying that the changes sponsored would have to go back
to the Congress?
0. K. I didn't think so.
No, the legislation just says that local sponsors will do this and there's
no particular hang-up on having two local sponsors if the project breaks out
that way so.. that's no problem. It's having a local sponsor.
I think there is one other thing, certainly our board within the constraints
of the law, be happy that the territory that's coming into our district,
if you all have any need for regulatory assistance, if we can help in any way:
in assessing any of the problems or questions that come up through our programs,
I'm sure Mr. Feaster can assist you. I know you're having certain demands
put on you for answers and whether or not we can dig up the hydrological data,
it might be a borderline thing whether in fact we're legal if we're digging up
data that's physically outside of the district. Certainly the intent of the law
is such that we would be in that and helped you with that data, we'd certainly
be glad at your request.
tary of the Army's level. When we forward that contract up for finalization by
the Department of the Army, it must be accompanied by our, you might say, some
supporting judgment as the capability to enter into and fulfill the responsibili-
ties of the contract. It is a judgment of matter on our part and has to do with
what type of staff the water management districts have, or if they have-no par-
ticular in-house capability in terms of real estate, have they acquired from out-
side sources; do they have a legal staff in-house or have they acquired the
services of a legal counsel for the water management districts things of this
nature, Jim. Would you like to comment on that?
I think that also in this agreement you are talking about that has to go for-
ward, this is the 221 agreement. Now that agreement would detail your authoriza-
tions the acts that have been passed by Congress, the Laws. I think thatyou
have the basic act plus about fifteen different acts. We have used 20% as being
generally contribution. In most of those acts, there is some variation of that
percentage comes about 20%. That 221 would require that any new district should
have taxing authority; you must have the capability of raising funds. It's a
legal document. If ..
Jim, let me interrupt here for just a second to see if I understand what you
are saying. You're saying that before you'd accept a new district, as a sponsor,
that they would have to have taxing authority?
You'd have to have some authority or some way of raising money.
Other than being at the pleasure of the Legislature?
That's exactly right. What it really says is that 221 agreement and the
people in the other two water management districts at the present time are
conscious of the fact that they don't want to lose what they've been doing and
I understand that. However, we did spend several years putting this thing to-
gether with a lot of you people who are sitting here today. We felt like we had
done a good job in setting up the five water management districts for the State
of Florida, which I personally believe we did. I probably consider going a little
bit further down the road before we say "Bar, you're going to do it this year",
but I say that when we do go down the road, that we say "Bam, you're going to
do it this particular year' and because you know, as I do, that there's never any
agreement on anything until the legislature decides that we are going to move in
that direction and among people in the field and I feel that we should speak to
that ourselves and not leave it to them. Of course, this suit you have in court
is something that's very interesting. I wasn't aware of that. A lot of things
sometimes that we do that we're not too happy with at the time that you do it,
Department of Pollution Control for one, I was very unhappy, and still am to some
extent; and yet, on the other hand, I think that they've done a terrific job in
solving a lot of problems, even though they created some. So I think that even
though the five water management districts are going to create some problems,
I think that the legislature in their wisdom, can hopefully solve them. make
another year down the turnpike. We don't have no crystal ball, I assure you of
that. to determine these answers that you mentioned earlied.
Don't admit that.
I found out a long time ago, Senator, but I think in working with people, we
can solve our problems, and at the time that we passed the legislation, although
there was some feeling that maybe it wasn't the greatest in the world,'people
generally felt it was a pretty good piece of legislation; so I might not object
to going down the road another year or whatever we feel is reasonable, but I.
the five water management districts, to do a coordinated water use plan for all
sixty-seven counties in the State of Florida. We recognized at the time we wrote
the legislation that there would be problems that would come up with the existing
regional water resources programs, that had existed in Florida since you name it,
1923. .. I suppose, when we had the hurricane on Lake Okeechobee; and they
always been approached on a regional basis as a reaction to some kind of a crisis.
And Florida Law, since the Everglades Drainage District went defunk in the 1920's
had looked to the federal government for help to solve its water resources prob-
lems. We didn't draft this bill not did the legislature pass it, to deal with
Central and Southern's projects or the projects of Southwest. So when we talk
about the inclusion of the sub-district clause in the legislature, that was simply
a recognition of the two existing special purpose taxing districts which we had
to recognize in this legislation and as to how they would be treated as we went
down the road. Now in the matter of sub-districts, our board recognizes that it
was potentially a way to effectuate an orderly transfer, held a hearing in
Brevard County, may be some two years ago to explore the possibility and probab-
ility and feasibility of having a referendum in that sub-district area which
was taken in to be transferred but it became immediately apparent to those in
attendance, since our special tax is a uniform tax throughout all of our eighteen
counties and based upon an assumed evaluation at this point in time of forty-two
million dollars, seventy-five to eighty percent of which comes from Dade, Broward,
and Palm Beach Counties, that those electors who live in Brevard County and had.1
been contributing tax revenues to our district for some twenty-five years would
be quite foolish to take upon themselves the entire burden to raise the taxes
to pay the local share of the required monies, when they had the opportunity to
use the potential of those urban counties to the south to help. And this project
has been developed on that kind of philosophy. It's been a uniform ad valorem
tax base over the entire eighteen counties so that although the people in Dade
Cc.inty pay forty-five percent of the total amount of monies which exceed three
arguing at all that we should stay in Southwest. We'd be ready to transfer
tomorrow if the funding and if the new board was up to the old in regulation
and the ongoing projects we have going on. So when the time comes, I'll be
glad to give up my seat on the Southwest Board and get back to work. That's the
only thing I have.
The first thing that I think we should consider, the Constitution; but
once again, if the three basins, the new basins, their governing boards did not
support this, then there is very little chance that this also receiving any kind
of enthusiastic support from the other basins water management districts. I
think that that is an answer to one of our problems and, secondly, I recall the
tedious steps that were taken by Department of Natural Resources, and I think
that it was a tedious procedure, going around having hearings on drawing the
boundary lines and they had a series of five or six public hearings around the
State. They drew the boundary the lines, as best as could be done following
generally topographic lines surface and water divides, surface water divides,
and I think that we know a great deal more today than we did even that short
period ago, how the inter-relationship between your surface and ground water
and this may no longer be all that important surface areas can be altered and
changed more than the groundwater flows actually; and so I don't think that there
is anything sacred about the particular bounds that were drawn. They are good
boundaries, but they would be good if they were moved over here and there. I
think that we almost have got to have an extension of time for a transfer. If
the transfer is to take place, we simply have got to get a handle on the funding.
Last legislative session it was hoped that that would be done; at the last minute,
rather than a more precise formula, or treatment, there was a lump sum, one half
million dollars a piece, for each one of the big districts. This really didn't
answer any of the questions. If we can know that we have to rely on the State
for an equal share for each of the districts. Well, then, I'm sure that some
No, we will, of course, discuss this at the next board meeting.
Representative Craig, do you have any words of wisdom?
I've got no words of wisdom, but I did want to ask, the gentleman right
there, Jack Woodard, somebody mentioned the possibility of working out a problem
in yours where those two districts could work out. You mentioned in your state-
ment then somebody said, well, there's hydrological problems and some other problem,
but we can kick these around all day long. But is it a possibility, with you
people here sitting in the room, and I don't know who all of you are, as far as
those two districts are concerned, that we could tie in those two and then we
would speak to the fact that funding has solved the problem in the Upper St. Johns
and your area, and at the same time yours too, but start to implement, at least
get your program moving? Now, that might not be the way. It's just something
in my mind that came up when you made that statement. Could we really do that
and then speak .to the others and come to a funding program; that the main problem
is over here, it looks like to me. Probably, if we could get the other three
together and leave these two hanging fire, until we can speak to it, from an
ad valorem tax standpoint; I don't know how much money we're talking about,
half a million bucks. Maybe we'll get that much this time. Is that a possibility,
that's all I ask?
From the standpoint of the Suwannee Board, it is very definitely a possibility
for implementing this transfer. We can explore with the Department changes in
boundaries if need be, but I don't believe we're going to have a significant
problem with this.
law passed by Congress is a legal document. If the federal government puts in
80% of the construction cost, and you decide you do not want to complete that
project, after you sign that "221" the federal government can complete those
projects and they could turn around take action against any sponsor who did not
elect to contribute those funds.
So the person that you are contacting with, you're saying, must have taxing
power. Is that what you are trying to tell us?
I don't know how you'd be able to raise funds other than, say in the
legislature, without taxing authority. Unless you have some other way .
I don't know how you can do it. Both of the two sponsors we have on the flood
control projects. .. the 221's you have the authority to levy a millage, I think
you can .
We do have taxing authority.
Excuse me a minute, did you ask him if St. Johns has taxing power?
Only as a referendum.
Oh, with the referendum
Is St. Johns going into referendum?
No, not until we've seen the letter from the legislature
don't think we'll go for the fact other than that when they say they're going.
to do it, they're going to do it. And then, if we have to have referendums to
tax the districts to do it, like the St. Johns area, I think that whatever we
decide to do from the legislative standpoint, then we can do it. If we must
make some change in the Constitutional amendment to solve your problem, in case
you get a bad answer on your program .I think that we should speak to it
to do that. I think that in years to come is what we are talking about with the
five water management districts.
I don't see how anyone could disagree with that approach. I mean, I just
listening here, I see some problems just as you do, the Colonel raises
that Buddy Blain raises; one little experience I've had with the courts is a
suit filed earlier this month in getting an answer by the time ya'll are com-
pleting your section, I can see some real problems there. I can see problems
the Colonel has in looking at new districts, and having to recommend to the Sec-
retary of the Army that they are responsible to take over these at this time.
A year, two years, yeah, great, but that's a real problem, and I don't see the
One of the things that bothers me is, Representative Craig, and I cer-
tainly agree with what you said and I agree with the act, I helped rather
lengthily in preparation of that act, but I keep thinking that we have a
problem now financing, and that's essentially what it is, and if the fact,
there is a material delay of whatever length that may be, wouldn't the problem
be greater; now it is a half million a year; as more works are constructed, as
the Colonel says, it is incompleted affairs of no use to anyone and it may be
one million or five million or what it will be if the whole project .
hundred million dollars, to this point in time, over our twenty-five years of
existence, they have not particularly received forty-five percent of the total
benefits and it is not done on that basis. So our board, as a result and comments
of the hearings and comments received as a result of discussions of the hearing,
recognize that it was not in the people's interest in the area to hold a referen-
dum at this time. In addition to that, as we have gone down the road since the
Act has become law, and when the Department of Natural Resources made its recom-
mendations to the 1972 session, on boundaries, it was clearly spelled out at that
point in time that there were funding problems and that those funding problems
were not imaginary. I can recall discussions of this type before the 1973 session
and at that point in time, we took the position whether or not it is appropriate
remains to be seen, but it was apparent that the legislature would have to, in its
wisdom, make a determination as to how these funding problems could best be
handled. Quite frankly, we are still at that same point and I don't think that
it's a reticence on anyone's part to attempt to defer the orderly implementation
of the law and most of us who have been in the water resources business up until
the point where the law was passed were responsible for making these very recom-
mendations, that the logical way to plan (End of Tape). economics for
one. I think this is the point that we find ourselves in. I guess what makes this
so binding is that we are looking at a date that is just a few months away and
we've got a hell of a lot more questions than we've got answers for at this point
That's very true, Mr. Maloy. The gentleman back there; Would you identify
I'm Tom Lawton from Brevard County. The legal question on the ad valorem
tax is, I gather, the main thing that's got us hung up and may defer for a
of the districts would be saying we don't want quite so much area for this
kind of responsibility. But the legislature in passing the law, and quite
frankly, there were many who did not think that it would pass, when we first
took that hill, but it is far more comprehensive than we hoped, but it is a
good law; its got its rough edges in financing that we simply haven't got -
we've got to answer those questions before we disrupt financing that has been
in existence for this period of time unless we're disrupting it and recognize
that we intend to disrupt it and I think that philosophically, the question
needs to be answered by the legislature they are the only ones who have the
prerogative, whether they want the Water Management Districts to continue to
have ad valorem taxes for one of their sources of funding or whether they don't.
If the transfer is to take place, as it is right now, as of July 1, I believe it
will effectively destroy the ad valorem taxing because it puts us in a very
inequitable position. For instance, what do we do after we gain Manatee and
Sarasota Counties? We obviously could not extend ad valorem taxes in these
areas unless they voted for it and if they voted against it, then we'd be in
State funds to take care of them and ad valorem tax funds to take of the re-
mainder. So then the next thing would be subject to a challenge to our ad
valorem taxing and someone would come in and get that knocked down or curtailed
so that we couldn't raise the volume of money that we could necessary to do
the studies and do the proper preparation of our share of the State Water Use
Plan, the regulatory activities. As far as the projects within the various
districts, and the Four River Basin Project, that is not as serious a concern
for us because we've been broked up in basins from the beginning. The legisla-
ture provided that we have different basins and we should tax at different rates
in those basins and we do in order to participate in the project as it benefits
a particular area. So that's not a bad problem as far as an equitable situation.
Representative Craig, I think to answer you though, we've got to get
another opinion, if I understood the lawsuit, Mr. Blain filed. It was a question
of whether or not this land left the district as well as if it came into a district;
if it affected the entire taxing authority of that district, and even though we
might transfer a little bit into the Suwannee or a little bit into the St. Johns,
the question before the court is still unanswered.
We think that we'll be successful in this suit, to say that it does not re-
constitute and we do have the authority.
I think that I understand that.
That is particularly why I prefaced it from the Suwannee District's stand-
point. We appreciate their integrity problem.
From a legislative standpoint I think that Buddy, what you're talking about
might be the wise move. It might be that we need to jog the other water manage-
ment districts into this taxing program, which they haven't seen fit to do as of
the present time, used to get into it too young and they'd not be ready, that from
a constitutional standpoint, have that set up so that it could be done and make it
so that they would know that it was available to them, and then people would be
voting on a constitutional amendment that spoke to water management; and they
know how crucial that is today in the State of Florida with our continued growth
naturally. Probably at that time, we could move on and get it done, hopefully.
I'm amiable to possibly going another year down the road 'til we get that done.
And then hopefully, until you can get that decision from the circuit court and
maybe we could have the three of them tied in and working in the meantime, and then
speak to that constitutional amendment in November. I'm not a lawyer, so I'm
probably saying things that are not true but from a layman point of view, maybe
Now this is what we understand. Everything is in the state of flux. Well,
I think that this is one problem you begin seeing the relationship with the
federal contracts. and secondly, the suit taxing problem that Buddy raises,
the third question I'd like to ask is "how many people would be involved, locked
under, people that now work in these areas, are there?" District employees?
Forty-two to forty-four in Central and Southern Florida Flood Control
District. I don't know what it is in your area.
So we're talking about fifty people. Not a large number, but by the same
token, what has been done as far as these people's jobs, providing for their
wages, income, fringe benefits, etc., have any plans or discussions been made
along these lines?
Yes, in the last board meeting, the request is actually in Central and
Southern Florida Flood Control District. Mr. Jim Stokes down there brought
to our attention the questions that these employees very properly raised.
Questions such as: will they be retained on the payroll actually picked up
by St. Johns District; what would happen to pay scales; to situations of annual
and sick leave; insurance, if the transfer is effected? Our board acted on
this and advised both districts because we intend to aim to move in this matter,
Senator, at least, which have commonality, advised both of the districts to
inform the employees of these two areas. We acted on the assumption that a
transfer will in fact, take place, and that by whatever means, the legislature
or other sorts of funding, we will be able to do that, and obviously it is con-
tingent on this issue. but. ..
But that you would take these people at their seniority level.
Craig, I'm very pleased to say what you've just stated in your comments,
because I firmly believe in the Water Resources Act. I think that it is a
magnificent piece of legislation; I believe that it holds the only success for
water management approach, to be on the basin wide approach in the State of
Florida. I would like to point out that this piece of legislation was passed
in 1972; we are currently in 1974, and we still haven't gotten off the ground
in the three new water management districts. The original transfer date was
July 1, 1974, and we've already put off the decision to make the transfer a
year, giving the two previously existing water management districts another
twelve month period to respond to the very serious questions involved. And
I don't in any way mean to negate that. there are real problems involved,
but unfortunately, in Chapter 373, the legislature gave the responsibility for
moving the transfer forward to meet that date, primarily in the two existing
districts. They were given the impetus and the power to implement the transfer
and they chose not to do it and there are still serious resolutions of board
members themselves that the transfer is ever a responsible thing to do. For
that reason, I am primarily referring to fact that as I read 373, the primary
legislative intent to implement the transfer lay in the fact that the two pre-
viously existing districts would establish a sub-district one in the Upper
St. Johns associated with Central and Southern Florida Flood Control and another
district in the Oklawaha, associated with Southwest; and that a referendum would
then be held by the two previously existing districts in the sub-district to once
and for all determine that those sub-districts wish to continue to pay ad valorem
tax in support of these congressionally authorized projects. If those are the
areas that are benefiting from the work of those projects, 373 provides that ad
valorem taxes generated in those areas will pay for the 0 and M cost of the
projects. So if those eventualities had taken place between 1972 and 1974, we
:.;uld have had a resolution of that ad valorem tax issue. We would know right
nw that the Upper St. Johns will not support continuing to pay ad valorem taxes
period of time, but could we not consider the thing in two parts one the 373
regulatory part, and make the transfer if we have to, because of the ad valorem
tax, of some 0. and M. requirements, why could not the 373 regulatory part be
transferred on data on that? Everybody stands at the same pot for this State
money which is going to run into 373. It's only those counties, those projects,
that have the Corps of Engineer Projects with continuing problems.
One of the problems is that, for instance, in our district, approximately
oh I'd say, less that 20% of our regulatory efforts is supported and funded
by the state. One year, the half million dollars which is not being cut and
sliced and chopped, and we're not sure what its going to be by the end of the
cutting time, but ad valorem taxes is paying the large share of our regulatory
activities in Southwest.
Maybe they couldn't transfer you but they could transfer the St. Johns
because of that one field station there that is 450,000 dollars a year, that
was designed for a major project and consequently it could be reduced signi-
ficantly. Now that could stay with the Flood Control District if they wish
it and get the St. Johns to take over the River under 373 management basis.
In response to your question,
Charlie, may I say something on that? It would not be feasible, I don't
think, in our estimation, to separate those activities, certainly not until you
determine what is going to happen with regard to the federal project. You
cannot have somebody making regulatory decisions about what you are doing with
water and somebody else trying to build the project to do something with water.
We can continue to do that, but it's our overall district taxes that are
.03 of a mill that concerns us. I think that we need to extend the time. I
think that we need to get a better handle on the financing. I think that we
need to pursue the constitutional amendment if the other three governing boards
support it. If they don't, then I don't think has much chance of being successful.
I'm inclined to believe that there are enough people interested state-wide in
water management, and especially in areas where it is already being done, where
it would not be an increase to the taxes, so a constitutional amendment, could,
if properly approved, at least attempted, and eliminate that one problem as far
as a transfer is concerned.
Mr. Blain, let's say that the legislature did go for the ad valorem tax
for water management purposes state-wide, with a change in the constitution,
when would the earliest time this could be anticipated that this would go
before a vote?
Well, in November, well this then would be a decision of strategy, as to
when it would the possibility of a vote. But I would think that probably
November; that this would then be an appropriate time to have such a thing.
Mr. Grafton, do you have any comments or thought that you care to share
No, I don't think that we've arrived very far in the basic reason that
we are here, and that is the federal aspect, at all, Charlie. I don't think our
year delay, unless the constitutional situation goes forward, will help at all
with the federal situation; and as Jack stated earlier, we want, when the St.
Johns is removed from our districts, we cannot have the responsibility (federal
responsibility) because we'd be unable to fund it with our ad valorem tax so
we could look at it in that light. And then to look to you people from the two
water management districts that have been in existence to help the new ones get
going; and prod them along the line 'cause I know we've got a problem with ad
valorem taxes and I know it's got to be solved and I know the State probably
can't fund the whole five yards of the thing for the five districts. But we
can maybe get funding to them in lump sums of the same amount and I think that we
also in speaking of State funding and all five water management districts that the
need in the five water management districts might be different and so you would
be funding heavily in some water management districts and very lightly in others,
which seems to me would be an unfair situation to ask people to do that, state-
wide, even though, water is a statewide problem so it seems like to me that the
equitability in the thing really dissolves down to the fact that each water
management district have its own ad valorem tax structure to solve its own prob-
lems and work with the Corps and whatever part you play in the others. I know
you play a part in the others, too. Maybe it wouldn't be too much in the other,
but does that sound like a reasonable way to approach this thing?
I think it is the only thing that remains unless we take a very serious
chance jeopardizing what we have done so far.
We don't want to jeopardize anybody's water management districts at all, but
we do want to move expeditiously and in the proper direction. Like the gentleman
over there said from Central and Southern, I agree with that; but I would like to
have, Mr. Chairman, from you, sent to my office, ideas that you folks will talk
about after I leave. I've gotta go back and meet with the Spanish Ambassador in
just a few minutes in St. Augustine. But I think it's good that we had the meeting.
It's brought to light a lot of the problems that I didn't know we had, other than
this ad valorem taxing problem. But I know the Legislature will look at it in
Everyone of them. One of our board members and our director visited the
group at Upper St. Johns and had a lengthy discussion and it is our complete
understanding that we are dealing with difficult human questions and that these
people are genuinely and properly concerned; it is a very difficult time for
everyone and so we made it abundantly clear that if in fact that we are able to
affect this transfer, that each and everyone of them would be transferred; that
their salaries would remain at current levels and until such time that they are
either reclassified, because some of them, in the case of Central and Southern,
at least, are under the State classification system, and if they-come to St.
Johns, they will have to get under the State classification system and that,
all the the positions, classifications, salaries, etc., will be reviewed after
the original date of transfer within one year's time and any such adjustments
that would have to be made would, to make them in accord, in fact be made.
Mr. Marshall, may I ask you a question? Have you and your staff arrived
at what this dollar cost would be? That you would be assuming?
The amount of money? I wanted to talk to the Colonel about this, Charles,
because I think that we are all very clearly aware that in our rather stringent
times, we're thinking about "bare bones" budgets and if we can't think of any
other matters, there's the matter of ad valorem taxation and rights that we
would have if we succeeded in an effective referendum vote. But no matter where
funds come from, it ultimately is coming from tax payers whether it comes
from general revenue or some ad valorem thing. Obviously, there is a large
question of equity. I have difficulty understanding of why people in one dis-
trict should be paying ad valorem taxes to maintain some project works; and
citizens in another community not have to. But that's not very proper. But
for a St. Johns River Project built by the Corps. I really think that we'd be
an awful lot further. As it is now, we are letting two Congressionally authorized
projects, one in the Upper St. Johns River, that's been attempted to be built
for the last twenty-five years and it has been in limbo since 1973; really,
the construction, I guess, stopped in 1972. It's a $35,000,000 investment that's
maybe a tenth or twentieth built and only ten percent of what is built is functional
and we're letting those two authorized projects deny the citizens of these areas
the Water Resources Act which has a completely different function, to solve
problems. So I want to make that point that I agree completely with my chairman.
It's not going to be any easier next year to do this if we don't establish a
responsible course of action, and go ahead with it and get it done.
Mr. Auth, I want to say that you are completely out of order, but we're
not here to criticize what has been done, we are trying to find out what we can
do to move these things forward. So let's keep that in mind.
Mr. Chairman, will you excuse me? I have another meeting to attend. I'1l
ask John to stay here and finish up what is going. Gus, I'll be glad to meet
with you anytime on this very uncomplicated problem.
We appreciate your coming very much, Senator.
Excuse'me, I'm concerned myself with what you said before I made my state-
ment about the additional costs in years to come; and I understand, Mr. Auth,
what you just said. Sometimes, I wonder why we came down to the point where we
are now when we weren't there last year or the year before; if you say that you
are sloughing off on somebody else, but that is normally the course for these
kind of things that take anyway. You get to the crisis point and you start to
rove. Until you get to that time, you lolly-dolly around and that's I guess,
Now that I think... is very simply it.
Thank you Mr. Grafton, what I was fixing to say is that the law as it's
now stated, if I understand it correctly, we cannot do this thing; either it
moves in toto or it doesn't move at all.
373 gives you leeway to do anything you want to do if you really want to
get at it.
I would agree with Jim that 373 gives you a tremendous amount of leeway,
but funding is a terrible problem. And the 373 if you are going to continue
to rely on ad valorem taxes as a substantial source of your funding. If you
abandon that and say that you are going to have all the funds in the state or
all the funds provided by local government or wherever, then there is no longer
a problem. Also, if you pass the constitutional amendment, would authorize
a levy of ad valorem taxes statewide or within districts or basins that would
eliminate the problem as far as the transfer is concerned, from that standpoint,
but I'd certainly agree with Mr. Grafton, that we have been wearing two hats.
Southwest created a regulatory district plus its regular districts and we had
a separate agenda for each, and then we would merge and then we'd pass this
motion as a regulation as a regulatory authority and this motion as a water
management district because under the old Chapter 373 we had certain powers and
under Chapter 378 we had other powers and it is very difficult and sometimes
we passed authority the regulatory authority because under the new 373, we've
got a two year phase in period that we can't short-cut.
That's what I say, you may have to deal these things individually "different
because the St. Johns problem is different from yours. But he could make the
that has to go hand in hand. There is a possibility that the State could
assume the local cooperation. I'm sure that the federal government would be
very happy to have the State do that. Now that's a possibility; and something
we discussed, but other than what Buddy has said, the problems are there the
one with the federal government. Of course, 373 addresses itself to many more
things than just the federal aspects of it that are important things and I don't
think that we ought to lose sight of those other important things. I don't
know if the other districts the three new districts, have progressed at all
in the regulatory activities. I don't know if St. Johns has done anything in
the regulatory activities; that is to adopt rules and really get into the business
in the part that they presently have in the Districts. So we've got to look at
all of these things.
I'd like to ask you one question, Bob, one thing you said pertains to .
a thought that has been in my mind since Jack mentioned about you hold and save
obligations that you have of insurance policies and so forth. This may be not
a large item, I don't know, but is it reasonable that. are you suggesting
that the State might consider funding the ongoing obligations; might they also
do that for the hold and save, the insurance and that sort of thing?
Oh, that's part of it. When you say "ongoing" federal obligations, that is
part of it.
So you are including that in the concept?
Oh, it would have to be. It is only one concept as far as the federal gov-
ernment is concerned. You have to agree to the local cooperation specifics and
that's one of them.
wisdom of doing a better job for the people of the State of Florida. So, if
you can get those things, I think we'll be moving in the right direction. I'm
here to cooperate and not just say that we mandatorily do this on July 1; that
we're flexible and we want to look at in in the overall picture. So if you'll
give me that information .
At the time that each of these changes were made, some of these problems were
not fully recognized; but as we go into looking at all the constitutional transfer,
things keep popping up. Hopefully we've got them all identified.
That is called hindsight. Twenty-twenty vision.
I hate to excuse myself 'cause I have gotta go; I appreciate the invitation
to be with you certainly, let's move to solving our problems during this legisla-
We really appreciate you taking your time. ..
ultimately, in trying to think this thing through, I think that the pot is not
full anymore (no pot is full anymore), and we have to think in terms of what I
call a "bare bones" budget and I was interested to hear your comments, Colonel,
about what the State obligation would be. I had been thinking of it in a very
different light, that the obligation, in terms of the contract "is one to oper-
ate and maintain", in other words, if we could in fact, operate and maintain the
works, we would be meeting the requirements of the federal government. I cer-
tainly hadn't thought of it in terms of whether we had a legal staff or whether
we have taxing authority or not. And so maybe I've been thinking of it in a
different light than is proper. That will certainly have to be checked up on
some more. But if we were in fact, responsible merely for operating and maintain-
ing the physical operation and maintenance of the works, then we get the immedi-
ate question, "what does the federal government consider as a minimum operation
and maintenance accomplishment in the bare bones budget"? That is one question.
Are we doing more now, for instance, is Central and Southern doing more than
the federal government would actually require to meet the minimum obligation for
operation and maintenance? The second question is, this may sound frivolous,
and I certainly don't intend it to be that way. I'm conscious of the funding
difficulties; what would happen if the State of Florida failed to operate and
maintain? Have there ever been any failures of record to your knowledge in the
United States, where in this State, or any other state, had an obligation to
operate and maintain an existing project in a joint session joint, state-
federal project and for financial reasons, failed to do so; what then would
On the first question, I think there, again, is not a great deal of flex-
ibility in regards to the contract requirements that we'd have to enter into
with the local sponsor. This is specified by law. Those points that I've
enumerated on, that provide land easements, and this sort of thing are specified
that's the way government operates. But I'm willing to listen and I'm here to
learn and as most of you know, I'm pretty well dead set on trying to move this
thing. I made this statement several times, not only in Palatka, but the news-
paper and other places. But I'm not unreasonable and I want to hear the whole
story out and that's what we're here for and so with that few remarks that I
made, let's go ahead and just hear you fellows out and hear what you've got to
say and find out where we are.
Yes, Mr. Feaster.
I've been coming along and trying to follow up on Dennis. I don't agree
completely with some the dates on that. As I recall, the Water Resources Act
was 1972; that did not fill any boundaries; it said new districts would be created.
We support and are in agreement with legislation. Department of Natural Resources
the same year, had hearings throughout the State. I have a copy of my state-
ment I presented, on the date of November 1, 1972, and it deals specifically
with the boundaries. I say in the statement and generally, we are agreeing
with the transfer, but no further consideration should be given to the transfer
until electors of the new districts show their interest by approving ad valorem
tax. Our point has been that the people in an area should show their interest
and support by being willing to put some money out of their pocket to match
the State and federal funds. But I don't feel that apparent three-year delay
is here, as Dennis presented it.
How can we demonstrate an interest in an area that we don't control?
We are talking about electors in a new district. The reaction that I had
the new districts aren't even to the point of considering supporting an ad valorem
tax, are the districts themselves.
transfer under 373 on this basis, that I'm talking about.
If the Upper St. Johns had the facility for financing the activity of the
Well, of course, if we had that problem, none of us have a problem, but
v;e do and I still think that we could work something out with the Flood Control
District to retain it for that purpose and let him run his water management
service and whatever he does in 373.
I think that that is highly impractical. You'd have to have the absolute
philosophical agreement in order to do that between the two districts, that is
the boards of the two districts; I think it would be the highly impractical
to try to separate the functions and transfer one part of it and not another -
take it all.
To further the discussion, there is more to this than has been brought out
at the moment. In that we have coming into the Central and Southern district
(South Florida Water Management District) come first of July, we have three
basins that have no means of financing today; we had an appropriation of this
year of 85,000 dollars to finance this sixth interim district. Coming into the
Southwest District we have the one Basin, Manasota Basin, which now their request
for funds for this next year is in the neighborhood of 100,000 dollars and they
have no means of financing other than from the general till -- general revenue.
So this thing doesn't stop just at the boundaries and transfer of the federal
projects involved here we also move into the other across this imaginary line
which we are pushing the funds for all the activities in there as opposed as
Then if that occurred, you might abandon your insurance policies and
abandon your fund you have set aside?
Make better use of it for something else, let's put it that way.
You wouldn't keep it for that purpose?
BOB GRAFTON: ..
No, well, yes, we would still retain the funds for the balance of our
district we still have that responsibility in the balance of our district.
The local cooperation. I wasn't intimating that the State would undertake
local cooperation in the balance of our district. I think the State would find
this a little bit unreasonable. But I was saying, for instance, the St. Johns
part of it.. .
I think that I would like to add something to that when you talk about
state. If you offered the State Legislature (although we think very highly
of the State Legislature) you have a law where you cannot commit an ongoing
government; that would not satisfy the federal government, so I think that in
keeping that in mind, it must be a body and I mean that Department of Natural
Resources probably should be a possibility, but I don't think that is should be
any state agency. You still have got to have something where you can get the
We have our hand outs. (End of tape)
I have to say that this will have to be analyzed. We would certainly be
willing to take a look at that.
Could I ask Colonel Lee what is estimated to be the earliest the project
in the authorization act for the project. And, in case of the Upper St. Johns,
there is a considerable investment in that project now; and it has been in1limbo
for some time now. We've gone through several alliterations of plans to see how
we can line that thing up to a usable facility to serve the public interest and
the State is agreeable to. As it stands now, the project, for all intents and
purposes, serves no one. Several million dollars of both State and federal money
is tied up there which does nothing for anyone. Now, I think in terms of the
Upper St. Johns, we have very little flexibility in entering into a contract
concerning a project which has never been finished. Would have to have a sponsor
who is capable of carrying out the specifics in here in the legislation creating
"it. In terms of your other question, of what has ever been done where a state
or local sponsor has not carried out their responsibilities; I can't give you
any specifics on that; I know of, in South Florida, there were some three canals
which were terminated at the request of the State some years ago and I guess
both federal and State government just backed off from that and there has been
no effort to recoup any federal funds for a federal project which has never been
carried to completion. I just can't give you an example where a federal gov-
ernment has moved against the local sponsor, in a case where they have defaulted
in a contract. I might say that this law that we've quoted here, this Section
221 of Public Law 91-611, is stronger. these binding contracts have not been
a factor in a lot of the old projects which have been going on for years and
years. It's only been recently that this has been enacted in the law where it
has been a requirement.
I certainly don't mean to imply that this is my immediate intention, make
that abundantly clear. As far as I'm personally concerned, I'm sure my board and,
I'm certain, the State of Florida feels the obligation very keenly. On the other
What I think Mr. Feaster is saying is that Central and Southern is
raising seventeen million, we are raising eleven million regionally, for the
support of our districts; how in turn, do we say to our taxpayers that you should
pay your own burden? The State as a whole will pay for the other three'districts.
I think that this is another way of what Mr. Feaster is saying.
But that isn't true. You are selling a commodity, namely, the Four River
Just a moment, please. We're trying to keep a record. I'm not being
short, but we're trying to keep a record and we can't do that unless we speak
one at a time. I recognize Mr. Blain, now.
Mr. Chairman, first, about a year ago, when we were discussing this problem,
and this was shortly after the new boards were appointed, and really, we've been
working on a crisis, no doubt about it, but there has been a continual crisis in
getting this law amended and trying to get it workable all the way through and
the new boards were not appointed until September, October, November 1, a little
over a year ago
So we've really come a long way and not without an awful lot of frustration,
a lot of education on the part of everybody. But we mentioned in January, about
a year ago, the thing that really frustrates this is that in 1968, when we revised
the Constitution, we prohibited the legislature from doing what it had in the
past with the two districts that were in existence. So we've got a philosophical
to the other side of it, the people who are paying taxes out of their own
pockets for the same thing as their neighbors, who are being financed by
the state, so I want to get this into the picture now Mr. Vaughn..
You've just brought in my picture I was just curious as to whether
Representative Craig might have had input from legislators from Manasota
and Sarasota. We get mixed commentary out of this area. As to their desire
to join the Southwest District or to remain semi-autonomous. I've heard all
the way from "to hell with 'em-we're not going to join 'em" to "yes, we should
join them" and how do you handle this type of problem?
I think that before the election took place, generally, they were agreeable
to joining Southwest. As to what's going on now, I don't know.
What was, yesterday, they had Manatee County before the County Commission,
I was told by an attorney last night coming up on a plane, they had some heated
words and indicated a strong desire to remain semi-autonomous. I don't think
that we can solve that problem.
Solving the problem really boils down to this: someone has got to take the
bull by the horns to make the answer to this thing and that is just exactly
what we're going to do in the legislature. Now, I'm sitting here trying to '
work with you people, hopefully to solve a problem and I'm not interested in
some little delegation's problem with their county commission, particularly.
I'm interested in statewide problems which I've got to look at in the over-
all picture. Now just to background you a little bit, the whole thing started
with a resolution that I introduced in the Florida Legislature. That's how
come you have the laws you have right now under Dick Pettigrew who was
in the Upper St. Johns would require additional 0. and M. or ad valorem funds
than we are now spending?
Well, there are 0. and M. funds being spent right now. For the time,
having developed some alternatives which were the subject of public hearings and
we're getting some input there, we have our engineering people back doing some
further alterations of planning there, trying to crank in some of these features
that were obviously desirable. I can't really give you; we have a certain
degree of flexibility in the way our money is appropriated by Congress since
it comes toward the Central and Southern Florida Flood Control District Project
which is as far as Congress is concerned, remains the same, whether it's put out
local sponsor-wise part between St. Johns and part between Central and Southern.
But we do have a certain degree of flexibility in that but not a great deal,
when you're talking substantial expenditure. If we could-get an acceptable
plan then we're into the budgeting process, so I would say that . it is a
subject of conjecture; I'd hate to give you a figure, but I'd say in a couple
of years, it'd be, perhaps, when we got an acceptable plan from everybody, say
it's conceivable, there's a lot of construction and come up with something that
would serve a purpose.
We really have then two years before Brevard County, and the others are
faced with an ad valorem tax greater than what the Flood Control is spending
now. I'm just trying to get time because that's what we've got to work against
to solve the ad valorem tax, that's the problem.
Well, my problem is, I think, is simply this: we need a local sponsor
on any federal project and if for one reason or the other the portion in the
hand, when I read in the paper, where I did, that the largest city in the
United States is considering filing for bankruptcy, I think we'd better take a
little longer view than we've been doing. Perhaps, this is an extreme thing, but
I like to go out and explore for alternatives. I guess that I look for extreme
situations. Dennis do you have any comments?
One question that I've wanted to ask Jack Maloy and the Colonel. How does
the actual liability assumption by the local sponsor take form? Is there a bond,
an insurance policy, involved to pledge this liability?
Yes, there is simply a contract and we brought along the contractual docu-
ments that we have in existence between the Central and Southern Florida Flood
Control District and Southwest Florida Water Management District, and if anyone
would like to look at them. .. It is specified in the responsibilities of the
local sponsor and any particulars inherent in the law rising on whatever is under
consideration and the contract is the document without any bonds or that sort of
thing required. Like I say, a good faith document. Again. .. I. when we
draw up a contract, and forward that to the Secretary of the Army for signature,
inherent in that is our recommendation to the Secretary of the Army that we have
assured ourselves that the local sponsor is capable of carrying out the require-
ments of the contract.
Just a moment, please. Mrs. Coleman, would you get us copies of all the
people here so we can get them copies?
I have their names already.
Could we have copies to distribute to everyone?
WATER MANAGEMENT DISTRICTS
CORPS OF ENGINEERS
DEPARTMENT OF NATURAL RESOURCES
PROPERTY TRANSFER MEETING
CROWN BLDG., TALLAHASSEE
January 22, 1975
. Mr. Lewis here, Chairman of Natural Resources in the Senate, and his staff,
Mr. DuBose and others. Thank you for coming. Senator, we are expecting Repre-
sentative Gus Craig, Chairman of Rules of the House Representative Craig will
be here shortly, but we'll go ahead and proceed with the meeting. I have to
apologize to you people for not being able to stay here with you. I have a summons
here from the Governor's Office to be there sharply at 9:30. (Come in, Art). We
are going to talk about collective bargaining among State Employees up there this
morning for about three hours and it's a very important meeting and it's something
I couldn't very well get out of. So, when I leave this morning, I'll ask the
Division Director, Mr. Charlie Sanders, to take chairmanship of the meeting. And
really, the purpose of the meeting here this morning is to find out the problems
that exist in the transfer of certain parts of these water management districts as
it related to the Corps of Engineers and the Federal Projects. But, first, let me
call on the Director of the Division, Charles Sanders, to bring us up to date with
the summary of the proceedings to this date.
Thank you, Mr. Chairman. The sequence of events that have occurred: the
Water Resources Act of 1972, directed the Department to come up with or recom-
n-end to the Legislature exact boundaries for dividing the State into fi-ve water
management districts by specific name. This was also to be done as nearly as
r f .
practical on hydrologic divides, surface water divides. This was done. Then in
1973, the Legislature by Chapter 73-190, Laws of Florida, then set the boundaries
of these districts. With the exception of a 6th district and delaying the date of
implementation until July 1 of 1975. Within the 6th interim district there were
four basins set up in this. One, the Manasota, which is Sarasota and Manatee
Counties. Then there is a little area up between the two present districts, the
Central and Southern part of the Flood Control District and Southwest Florida
Water Management District, was set up as a basin. Then we had the Big Cypress
area, then we had the Keys, these are the four basins that are set up within this
interim district. We have reached, for the last year or more, after we had the
director appointed by the Governor, for the three new districts, we and they have
held with inter-agency or inter-district meetings to look at the problems we're
facing in the transfer of territory, in compliance with the law. .. what is in-
volved we.:have the upper St. Johns which is in Central and Southern Florida
Flood Control District, going to the St. Johns Water Management District. This is
a federally authorized project or part of federally authorized project. We have
the Oklawaha Basin, which is a part of the authorized project in the Four Rivers
Basin, going to the St. Johns. They are in the SWFWMD, now. What we feel that we
must resolve; what the requirements are from the federal people as the minimum
that must be met for guaranteeing the transfer of the territories, the functions,
the responsibilities, so that we can make some recommendations and know where we
are in making our recommendations to the Legislature for meeting the mandate Senator
that we are faced with. Now, we have involved in this financing, we have in both
of the older districts -- they have ad valorem taxing authority; the new districts
do not have that, and will not get that unless they go by referendum by the affected
people. We have maintenance operations that must be carried on, that must be funded
in the guarantee with the federal projects. These are just mentioning some of the
problems that we are faced with, and hopefully this morning we can get these laid
out on the table. Col. Lee, could you give us exactly what we must have for your
guarantee to move forward with this activity. Mr. Shields, without question, I'm
going to rush at that point.
Alright, I am sorry I'm going to have to leave momentarily.
Mr. Shields, before you leave, one of the reasons I'm over here, I want to
hear about this because it obviously will probably come either through govern-
mental operations or Natural Resources, but I know that the FCD has adopted sets
of rules and regulations and on top of being the chairman of Natural Resources, I
am also chairman of the Administrative Procedures Act, that fine new piece of
legislation that everybody is so much in love with. As I understand it, you have
both set up rules and regulations; the other five districts have not, the other
three district have not as yet. One of the things that occurred to me is that,
and I wanted you to be here or I wouldn't have interrupted the meeting at this
point, I just want to make it clear what I hope you all will do. This should be
for the public's best interest: a commonality of rules; you shouldn't have five
separate sets of rules, when you go from one district to another, you can't under-
stand what one district is doing. Now, there are obviously going to be things,
local in nature, to a particular district, but rules of procedure, rules of oper-
ation, rules that are going to effect all the districts should have common ground.
I would suggest that the rest of the districts get those commonalities and the
other two districts that already have them get their common grounds as promptly
as possible. Because we want to look and see what you have done, this falls into
our chore and I don't want to have to see our staff look over five different sets
of rules and find that all five of them are different. Except in those areas that
are germane to a particular area and I want to make that abundantly clear. We'd
like to see that done as promptly as possible. That's so much for the reading
of the Scripture.
HARMON W. SHIELDS:
You are so right.
Let me mention, though, Senator, that one of the problems is that SWFWMD
has had a regulatory authority since 1968 and C&S's development is much more
sophisticated as far as permits for use of works of the district that have not
been into the regulatory aspects of it. We have accumulated and taken a different
approach, so these rules have been developed at different speeds in a particular
area. I think that would give some distinction. Quite frankly, if the new dis-
tricts were to take our rules which we think are quite good, or C&S which we also
think are quite good, and adopt them per se, they wouldn't be applicable or they
wouldn't be able to enforce them because of the lack of basic data to even apply
the yardstick to them. I think there is going to be a period of time before you
can get this kind of uniformity, but certainly from a procedural standpoint, we
ought to try to merge these together. I think the point is well taken, but I
think as far as having uniform set statewide, we are a good long ways down the
road from having that. Unless, there is an awful lot more money coming for basic
studies and gearing up and technicians and so forth.
Well, I think that you better get at it. I think the point is, as I under-
stand it, the other new agencies haven't got any rules. And I think that it should
be for the public's best interest, commonly down the line. Obviously, there is
going to be some questions, for instance, in artesian wells, I don't know what
the differences would be, as germane to that local area. The basic ru-les of
function I think should be established. I think I feel that the biggest problem
is going to be between the two that are already established not the new ones. The
new ones are going to reach up and grab some off the shelf, if they can, but you
ought to get at it.
Thank you Senator. Col. Lee?
Let me preface my remarks on the thing. We're aware of the, of all that is
being considered here in the transfer of these functions and let me preface my
remarks by saying that we have no position of this one way or the other. It is
strictly a state matter, other than the fact that we do look to having a local
sponsor capable of fulfilling the requirements that are imposed by various pieces
Specifically, those requirements are generally as follows: that the local
sponsor can contribute in cash an amount equal to a certain percentage of new
construction projects, that being specified by the Act which brought about the
project. In the Central and Southern project, this is 20%, in the Southwest Florida
Water Management District, projects, these projects are 17% local contribution. We
must have in hand the funds for the local sponsor before we can advertise a con-
tract, for example, in other words a yearly contributed share from a local sponsor.
So this translates into financial responsibility and financial capability. The
legislation requires that the local sponsor furnish to the federal government all
lands, easements and right-of-ways, incident to new construction projects, which
again translates into a capability for real estate, financial capability, a lot
of legal ramification there. The acts require that the local sponsor, furnish
assurances satisfactory to the Secretary to the Army that the local sponsor can
hold and save the federal government harmless or free from damages due to con-
struction and operation of the work. The other major responsibility is the abil-
ity to take over the works once constructed to operate and maintain them, operate
them in accordance with regulations approved by the Secretary of the Army. These
are generally the responsibilities imposed on a local sponsor. Those responsibil-
ities are genesis in the law. There are other subsidiary pieces of legislation
that the local sponsor falls heir to; for example, there is a Public Law 91.646,
having to do with relocation of families from lands which are to be taken over for
federal projects. This falls to the local sponsor and there is some very strict
federal requirements on that. Public Law 91.611 requires, in Section 221, re-
quires that the local sponsor enter into a contract with the federal government.
So, the local sponsor has to have that authority to enter into a binding contract
with the federal government relative to the works to go forward. This, in a nut-
shell, really is the responsibilities of the local sponsor with regard to new
work taking over and operating those works that have been completed. Aside from
those, we do as a matter of course, in our experience with Central and Southern
Florida Flood Control District, and the Southwest Florida Water Management District,
those districts having been established for some years now, we do coordinate
closely with their staff of engineers and their environmental staff in developing
projects in our planning process and in the writing coordination of environmental
impact statements and the like. So, we do like to have a technical staff avail-
able with whom to consult concerning planning operation of the projects that are
under way. Very briefly, these are the responsibilities of the local sponsor;
virtually all of that is set in law and there is not a great deal of flexibility
to waiving these requirements. I think that about sums it up, Charlie.
Thank you, Colonel. I would like now to get a response from the two older
district where the territory is to move out of into the St. Johns, get their
response and then we'll hear from the Chairman or the Executive Director of the
St. Johns, so can get all of this out on the table before us if we can-and then
see if we can arrive somewhere down the line at some specific recommendations that
we might make.
Jack, Mr. Maloy, the Executive Director of the Central and Southern Florida,
would you care to respond at this particular time? Or do you have someone that
you would have rather respond?
Of course, our response Charlie, is naturally a concern and when the trans-
fer takes place, that the liability that presently rests with the taxpayers in our
district is properly assumed somewhere else. And we can't, at this point in time,
see any way that that can be properly assumed unless the legislature itself can
assume it. Because the new district is totally dependent on the legislature for
its payments and that's our only concern, the fact that once this area passed out-
side of our jurisdiction, that since we are presently a signatory in agreement
with the federal government to carry out those various things that Colonel Lee
has enunciated, that when this area is out of our district those liabilities be
properly assumed by the new entity. I assume that that is everybody's concern
in this entire thing. Other than that .that is our only general comment at
Jack, would you answer a question, please? When the Central and Southern
Florida Flood Control District and/or Southwest Florida Water Management District,
both when they were established, did the legislature cough up any money? Or was
it all done by ad valorem taxes?
No, it's all done by both districts are formed by special legislation,
which creates them as special taxing districts. And they each levy in ad valorem
tax in their area of jurisdiction to support their programs. Now, the legislature
did create a special account, the Water Resources Development Account, to pay for
such things as matching funds for construction and for the purchase of storage
lands. In addition to that, the legislature for some time, made monies available
for highway relocation, but in recent years they have eliminated that from the
Water Resources Development Account which has caused some problems and they have
given that to the Department of Transportation that the operations and maintenance
responsibilities and the assumption of liability responsibility have been adminis-
tered through local tax collection; the matching funds for construction and the
purchase of water storage lands have been handled by the Water Resources Develop-
ment Account. Now there are some substantial additional right-of-way require-
ments that do not deal specifically with water storage or reservoir lands. Those
are also assumed by local taxing monies. And to give you some idea of the extent
of the monies that we are talking about, in our district, we are probably talking
about $17,000,000 in this fiscal year we are presently operating under which
has been raised by ad valorem taxes.
Nice size neighborhood. But didn't the State come up with any seed money?
Southwest did not come up with any seed money other than .actually
they borrowed $75,000 which they repaid the first year that taxes were levied,
but this was organizational money that was needed at that time. This was in
1961. The current millage levy yields about $11,000,000 and we did a study re-
cently on what percentage of the total expenditures come from state, federal ari
local and this is, of course. we're on a seventeen percent match with the
federal government on the Four River Basins Project, but it worked out almost
equal thirds that the state put up on water storage lands, federal put up in con-
struction, and we put up in ad valorem taxes that we used for paying for the cost
of acquiring the land (administrative cost, regulatory and others). Our percentage
is going up now because we are more involved in regulatory activities which are
mandated by the 1972 Act. I might mention, and this is one concern of ours,
and we've discussed this with most of the people here, is that in 1968, when the
Constitution was amended, it prohibited creation of other districts with the
same taxing authority that we were given when we were created, and that Central
and Southern was given, but there is a provision in the Constitution that pro-
tected those that were in existence when the Constitution was revised. "Our con-
cern is that if we are re-constituted, which the law says we will be, after
July 1, 1975, that this could in some way jeopardize our ad valorem taxing author-
igy. If it did it would mean that we would have to come to the state for the
entire $11,000,000 or else curtail the activities. One or the other, so we have
filed suit in Hernando County to test this, hoping that the court will render
declaratory judgement to do two things: one, to declare that this change of
boundaries does not re-constitute to such an extent that it terminated the old
district and created a new one and second, that it would in no way jeopardize
our ability to levy taxes both for basin and for district purposes which we
presently have. Then we did a study recently about trying to extract how much
tax revenue would be lost by the transfer, and of course when it is transferred, the
law provides that the taxing authority does not go with the transfer, currently,
based on our current year levy on the area that will be removed, we anticipate
$767,000 in revenue will no longer come in that will have to come form the state
if these activities are to be maintained in the areas that are transferred out.
There is a potential tax if the maximum millage were levied of a million-eight
from this area, and this is relatively a small percentage of our area. I suspect
that Central and Southern's revenue would be even created than that by quite some
amount because of the area being transferred is more extensive. But these are
large questions and another provision is that when our district was created, we
were given the responsibility for providing certain operations and maintenance
services from the district-wide tax of facilities that would be transferred and
that would be lost; that's not paid for entirely by this money. That's paid for