Condo No-Go: Florida Cabinet Sides With Flagler County Over Hammock Dunes

Flagler County has prevailed over developer-investor Ginn-Lubert Adler in a showdown before the Florida Cabinet.

It took 30 minutes to resolve a dispute that had stretched over two and a half years as the Florida Cabinet moments ago this morning unanimously approved a judge’s order that blocks Ginn-Lubert Adler’s plan to build an oceanfront condominium and hotel at Hammock Dunes, near the 16th Road public park and beach. The Flagler County Commission repeatedly opposed the plan through repeated amendments by the developer, citing damage to the public beach and vast changes to previously-agreed pledges. (See the story’s background and documents here.)

Flagler County had the judge’s recommended order on its side, but it deployed an array of voices to press the point before the cabinet in a series of pleas compressed in 15 minutes. After Jacksonville attorney Wayne Flowers briefly laid out the county’s case, County Commissioner Milissa Holland spoke longest while appealing to the cabinet’s respect for local control and the law’s respect for written agreements and promises. She drew a long burst of applause from dozens of blue-shirted Hammock and Flagler County residents, most of whom had driven up at 3 this morning to lend their support.

“As the fastest-growing county in the state of Florida, Flagler County understands and embraces the need for responsible growth management,” Holland said, alluding to something Ginn-LA’s lawyer and investor had said moments earlier: that Ginn-LA was being stopped from investing $50 million and creating 300 permanent jobs, and 300 construction jobs.

“It is important to protect the very things that made us attractive to live, work, play, raise a family, or retire, to maintain our quality of life and economic vitality in the future. The commission and the developer crafted a well-reasoned and binding set of development criteria and codified them in the final DRI [Development of Regional Impact] for Hammock Dunes going back to 1984. Lost in the shuffle of all the paperwork and the lawyering is the fact that the only reason this oceanfront resort presently exists is because the county gave 33 acres of its publicly owned beachfront park to Mr. Ginn to develop the Hammock Beach Resort. This was based on his promise to set the condos back from the beach.”

Gov. Scott stopped Holland, asking her to explain how the developers got the property. Holland explained. “Do you all dispute that? Does anybody dispute that?” Scott asked, looking at the Ginn-LA side. There was no dispute. Later, Ken Wright, the attorney representing Ginn-LA, returned to the dais to say that his client had not developed on “entirely donated land,” that there had been extensive land-trading. That, too, had not been in contention: Holland’s point was that a critical part of the development depended on the county’s donation.

Holland noted the 1998 alterations that led to the golf course along the beach and the high rise inland. “Now this developer wants to re-trade this deal,” Holland continued. “They want to create a new residential cluster where one never existed before. That was never part of the project and assert that this is somehow vested under the original development order. Worse, the newly proposed clusters in the golf course area in which limited development is to occur. To allow this to happen would be for the county to go back on its word, to the detriment of all of the residents who purchased there in reliance on the development order, to the detriment of all Flagler County residents who use the park facilities, and to the detriment of Flagler County residents in general who depend on the county commission to live up to its word and commitments across the board.”

Holland then appealed to the cabinet’s own commitment to “local control.”

“At a time when cynicism regarding government seems to be at an all-time high, we should be even more diligent about maintaining the public’s trust,” she concluded. “”Please do not let this case become one of big government telling us at the local level what is best for us.”

Ginn-LA’s side spoke first, with Wright arguing that the administrative law judge’s order was “flawed” and based on facts that didn’t exist. He said the look of the project itself, “what it was to be built as, look like, had not been determined.”

“I stand here before you suggesting that that judge’s opinion is indeed wrong,” Wright said. “And you are the remedy to that wrong. And I know I’ve got a hurdle to overcome. I know what it’s like, whether it’s the cabinet or water management district to be faced with a recommended order against your position, and I know you8’ve been briefed and I know the pressures that are upon you. As most collegial bodies to is go along with the recommended order. But you’re the remedy. You can change this. By granting our petition and upholding our right to the NOPC [notice of proposed change], not one shovel will be turned, no prejudices are going to be born, it simply sends us back to the county with the ability to go through the process of having a site plan review and have someone look at our project based on facts rather than having facts created.”

But the two sides have been going over that “process” since 2009: county staff had, in fact, agreed with Ginn-LA’s proposal, only to be overturned by a unanimous county commission. Wright then change approach, citing Flagler’s high unemployment rate and speaking of the capital his client was willing to invest, creating jobs. “This is how capital is treated badly. You have an opportunity to treat capital well,’ he concluded. The argument was less substantive than rhetorical, claiming that the judge was wrong, and that it is wrong to stop investment.

Wright was followed by Neill Faucett, a principal at Lubert Adler Real Estate Investment Funds, who pressed the point further by going after–if not pandering to–the cabinet members’ instinctive sympathies: “We have two and a half billion dollars in our current fund to invest,” Faucett said. “We are business people. We invest money in areas of the United States that are pro-business. For example, this month, we’re investing $150 million in the state of Texas, where we were welcomed.” He said Ginn-Lubert Adler currently employs 460 people in Flagler County, spending $41 million locally. The new project would increase that to $61 million and employ 300 additional people. The precision of the numbers seemed at odd with Wright’s claim earlier that nothing had been decided yet regarding the size and impact of the new project. “We want to invest this money in Florida, rather than other states, because the benefits of economic development are critically needed here,” he concluded. “Don’t send us away to invest this money in other states until at least we have the opportunity to present a plan.”

Flagler then presented its side.

Holland was followed by Dave Tillis, once a developer of the same property and now an opponent of its latest proposed incarnations, and Sen. John Thrasher, R-Jacksonville, who deployed insider charm and flattery–beginning with birthday wishes for Adam Putnam, the agriculture commissioner who turned 37 on July 31–and recognized the many Flagler County residents in the room. “They actually got up about 3:30 this morning and got on buses and came over here. You know, I’m not involved in the legal aspects of this. I just represent these folks.”

He then countered the developers’ assumption that the developers alone had capital at stake, or that they alone were making investments. He pointed to the Flagler residents in the room and said, referring to Ginn-Lubert Adler: “When this organization came to the state of Florida, the capital that was invested in it was by these very people right here. And they invested their capital based upon an agreement and a deal that they thought they were making at that time. And now these folks want to change that deal. And I understand that. I understand it. I understand why. But frankly I don’t think you can do that, and I think the administrative law judge agreed, I think the county commission has agreed, that you simply can’t go and change a deal you made just because you want to enhance your profitability. These folks invested in this property with reliance on certain conditions and restrictions, and they ought to have a right to continue the good use of their own personal property that they’ve invested in.”

When both sides were done, Scott asked the cabinet’s counsel what its authority was. “Very limited,” Mary Thomas said, given the judge’s order on the table.
“And after review of the record, and pursuant to the law, the ALJ’s finding of facts and conclusions of law we feel cannot be altered in this case.” The ALJ is the administrative law judge. Scott asked if Ginn-LA had a remedy. Yes: they can go before the county commission again and submit a plan in accordance with the county’s land development code and the DRI order, the attorney said.

“Why didn’t they do that before?” Scott asked.

“I don’t know,” the cabinet attorney replied.

“OK. Because that would have been the logical way of doing it,” Scott said.

“I would suspect, yes.”

None of the cabinet members had any questions. Jeff Atwater, the chief financial officer, moved to accept the judge’s order. Pam Bondi, the attorney general, seconded. The motion passed unanimously. The assembly applauded. Scott adjourned the meeting.

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Audio: The Full Hammock Dunes Hearing Before the Florida Cabinet (33 mn)[media id=229 width=500 height=400]