Department of Commerce Issues Preliminary Decision

With yesterday’s preliminary decision by the Florida Department of Commerce, the Captiva Civic Association (“CCA”) and the “Protect Captiva” coalition have now met the two preconditions required to request a hearing before an administrative law judge who will determine if the Land Development Code amendments passed by Lee County to permit increased building heights and density on South Seas and Captiva are inconsistent with the Lee Plan. The Plan requires future development to be consistent with the historic low-density development pattern on Captiva.

Our petition and request for a formal hearing before the Florida Division of Administrative Hearings will be filed no later than May 28. The Administrative Law Judge will swear witnesses, take testimony under oath, issue subpoenas, and effect discovery at the request of any party. The parties in the hearing can include CCA, any intervenor, the state land planning agency, and the County. A formal trial will be held on the issues at stake for our community.

Our initial petition explaining how the Code amendments were inconsistent with the Lee Plan was filed with the County on Jan. 8, 2024 and amended on Feb. 20, 2024 as required by the State Statute. Not surprisingly, the County rejected our claims — contending that we did not have standing and that the Code amendments were consistent with the Plan. We then filed with the Department of Commerce (“DOC”) on March 7, 2024 and March 22, 2024.

The DOC held an informal hearing on April 4, 2024, and issued its 19-page written decision on May 6, 2024, finding that the CCA has standing to sue, but that the Code amendments were arguably consistent with the Plan.

The DOC devoted most of its decision to the standing issue and correctly held that the County was wrong and that CCA “has adequately demonstrated standing as a substantially affected person under section 163.3213(2)(a), Florida Statutes.” The DOC acknowledged that our Petition can now advance to the formal administrative process outlined in section 163.3213(5), Florida Statutes.

The DOC decision on the Code/Plan consistency issue, while disappointing, was not unexpected given the DOC’s view of its role in these cases as reflected in recent rulings. Most importantly, it is a preliminary determination — and under the state legal process, a decision based upon the review of all evidence will now occur in a full administrative hearing. The reasoning employed by the DOC after its one-hour informal hearing is unlikely to hold up to scrutiny in an administrative hearing.

At the outset, the DOC correctly recognized that the development standards set forth in the County’s 2002 Administrative Interpretation identify the maximum density of the South Seas Resort as 912 residential units (304 acres at three units per acre) and five (5) acres of commercial development, that the new ordinance exempts South Seas from the density limitation of three units per acre for hotels and motels on Captiva, and that the new ordinance also exempts South Seas from the maximum height limitation in effect everywhere else on Captiva. The DOC also acknowledged that the new ordinance provides for the possibility of South Seas obtaining an allowance to develop buildings as tall as 75 feet above base flood elevation.

The DOC’s theory as to how these new Code amendments may be consistent with the Lee Plan is difficult to comprehend.

First, the DOC states that “(t)he County considers the 2002 [Administrative] Interpretation as the controlling document that outlines the current standards and development potential of the South Seas Island Resort.” If that were true, 912 residential and hotel units would be the cap, and there would be no need to litigate.

Second, the DOC inexplicably accepted the County’s claim that the 912 units don’t include hotel rooms despite the explicit and repeated County formal interpretations stating otherwise. Even the most cursory reading of the Administrative Interpretation and all the prior and successor zoning documents establish that the 912 units include both residential and hotel units.

Third, the DOC did not question the County’s argument that Captiva’s density limit of 3 units per acre does not apply to hotel or motel units, and that other hotels on Captiva are not subject to the density limitation. However, this is an obvious mistake. Section 33-1628 of the Captiva Code provides that, “no building or development permits will be issued for development on Captiva Island at a density greater than the following: Three units per acre for motels or hotels.”

Fourth, the DOC stated that the County’s 2002 Administrative Interpretation is not clear if hotel or motel units were intended to be included in the 912 unit cap. This is also incorrect. The Administrative Interpretation makes it crystal clear that the 107 hotel units at South Seas were always included in the 912-unit cap. Even the new owners of South Seas concede in their current rezoning application that the existing 912-unit cap includes hotel units.

Fifth, the DOC states that there is no evidence to suggest the increase to the height standard provided by the new ordinance . . . would result in an additional habitable floor or more units on South Seas. This makes no sense. The current application by South Seas – tailored to comply with the very Code change the DOC said would not allow an increase in habitable floors — proposes additional habitable stories and a 286% increase in units on the 120 acres owned by Timbers and its partners – an increase from 247 to 707 units.

In the end, the DOC determined “that there is at least fair debate on whether the challenged provisions of the ordinance are consistent with and further objectives and policies of the Plan.” But the DOC also states that “(w)ithout additional information, it is difficult to determine conclusively whether the Ordinance alters the development pattern of South Seas Island Resort in a manner inconsistent with the Plan.”

CCA believes that the DOC, in its written decision, did its best to confirm our standing to proceed to an administrative hearing, but provided an unpersuasive and flawed decision on the Code/Plan consistency issue. As occurred in a recent challenge by our lead counsel to a similar land development code amendment by Sarasota County to allow a hotel density increase on its barrier islands, we fully expect that in a real trial before an actual administrative law judge, we will successfully prove that the Code amendments that increase building heights and density on South Seas and Captiva are inconsistent with the Lee Plan.

DOC decision is attached here.