Walton County buys Dune Allen beachfront property despite lawsuit  


PROPERTY AT Dune Allen with approximately 220 feet of beachfront.


WALTON COUNTY –   In spite of a legal challenge, Walton County officials voted to go ahead and purchase property at Dune Allen with approximately 220 feet of beachfront.
The decision took place at the Sept. 12 Walton County Board of County Commissioners (BCC) meeting at the South Walton Annex, after several citizens came forward to encourage the commissioners to move forward with acquiring the property. The property, located south of Stinky’s Fish Camp restaurant, is envisioned as a regional beach access.
“We need this beach access,” Celeste Cobena, resident and business owner, one of the speakers, told the commissioners.
“Keep your conviction on this,” Dave Rauschkolb, south Walton restaurateur and resident, urged.
Mark Davis, Walton County attorney, provided a due diligence report on the property and also discussed the fact that a lawsuit challenging the county’s ability to use Tourist Development Tax (TDT) funds to purchase the property as planned had been filed since the time the BCC voted to sign a purchase contract on the property (Aug. 23).
The contract had provided for a 20-day due diligence period.
Davis reported that the property is 1.51 acres in size. Included in his report was the land use classification of the property, Neighborhood Infill, and a determination by the Walton County Planning Department that the land use classification would allow for its intended use with approval as a major development. However, the planning department recommended that the county pursue a land use change for the property to the Parks and Recreation category, which is reserved for property owned or operated by the county as park and recreational facilities.
Davis reported no title issues with the property.
Walton County property owner Lisa Boushy asked Davis where the funding for the property would come from if the court ruled that TDT funds could not be used.
This was addressed in Davis’ report, which indicated that, in this instance, the county would have to reimburse the Walton County Tourist Development Council (TDC) from general operating funds or reserves—or that, alternatively, the county could borrow the funds, reimburse the TDC, and then pay off the loan over a number of years.
Davis expressed confidence in his office’s interpretation and opinion that the county would be able to use TDT funds to buy the property.
Following the report, the commissioners voted unanimously to approve and authorize BCC Chair Sara Comander to sign closing documents for the property purchase on Sept. 15.
On Sept. 14, Walton County’s legal counsel was present at the Walton County Courthouse for a hearing on the lawsuit filed in connection with the Dune Allen property, with Judge Thomas R. Santurri presiding.
Filed by homeowners in the Dune I condominium just east of the Dune Allen property, the lawsuit complaint had been served to the BCC chair on Sept. 9, along with a motion for temporary injunction aimed at barring the county from closing on the Dune Allen property.
The Sept. 14 hearing was in connection with the request for temporary injunction.
Attorney Will Dunaway represented plaintiffs at the hearing. Among witnesses called by Dunaway was Bruce O’Krepki, owner of two Dune Allen condominium units, one on either side of the property that the county intended to purchase.
O’Krepki said his family spends more than 100 days a year at one of the units, which they do not rent, and leases the other unit on a short term basis. He testified that he has both a personal and financial stake in what would happen with the property between his two units.
O’Krepki said the beach is very quiet in the vicinity of his units. “I’m about to lose my tranquil oasis,” he complained.
In cross-examination, attorney Davis referenced the basis of the legal challenge, the use of TDT funds. He questioned whether O’Krepki’s objection was to the use of TDT funds for the purchase or the use of the property to be purchased.
O’Krepki acknowledged that his interest in the use of TDT funds was no different from that of someone living in another part of the county, Paxton or DeFuniak Springs, for example.
However, when questioned by the plaintiffs’ legal counsel, O’Krepki confirmed that his understanding was that the county’s use of the property was tied to TDT funds and that he was interested in seeing that the laws of the state were followed.
Davis made the argument that in Florida “standing” is very limited in challenging government actions. It is limited, he explained, to instances in which the party experiences a “special injury” over and above others, or challenges are possible on a Constitutional basis, although courts have rejected challenges on the latter basis.
These limitations are essentially set up to allow legislative bodies to move forward without interference from the courts, he noted.
“He has no special injury” with regard to the expenditure of TDT funds, Davis said of the homeowner. “He does have access to the courts,” Davis added.
He pointed out that the county would be required to go through the public approval process to obtain a development order for the property, during which citizens would be able to challenge the proposed use of the property, if their objection is what will be built on the property.
The admission by the homeowner that his interest in use of TDT funds did not differ from that of other county residents, Davis argued, showed that he does not have standing to challenge the use of these funds. He asked the court to deny the motion for temporary injunction on that basis.
Dunaway countered that the county had authorized the purchase as a “nature park,” which, he alleged, was “not one of the ennumerated uses” for TDT funds in Florida Statutes.
If it is deemed that TDT funds cannot be used, there will be a reimbursement with county general funds and therefore “the public has an interest,” he continued.
The use of the TDT funds cannot be separated from the use of the property, which impacts the plaintiffs directly, causing them injury, Dunaway maintained.
Davis countered that the latter had not been the testimony of Dunaway’s client.
Dunaway referenced the “four prongs” required to be met to justify the granting of a temporary injunction: that the plaintiff will suffer irreparable harm; that the plaintiff has no adequate remedy at law; that the plaintiff has a substantial likelihood of success on the merits of the case; and that the temporary injunction will serve the public interest.
He argued that allowing the county to expend the funds for this “unauthorized use” would cause irreparable harm. Once the property is purchased, the county would presumably move forward with the use, he observed. An accounting remedy, Dunaway continued, would not be a remedy at all.”We would never be able to divest that sale,” he asserted.
“That is not irreparable,” Davis disagreed, saying that the simple remedy in the event it was deemed that TDT funds could be used would be to reimburse with sales tax or ad valorem funds. He added that the plaintiffs would have remedies in the ability to challenge the use of the property at the public review/development order stage. There are a number of attorney general’s opinions on the allowable use of TDT funds, and obviously the county disagrees with the contention that the expenditure is not allowed by statute, he noted.
Davis also asserted that the county moving forward with the purchase without interference rather than the injunction would serve the public interest due to plans for public beach use being provided on the property.
The county does not often have the opportunity to purchase property for public use, and when it is there, the county tries to act as quickly as possible, Davis said. The granting of the injunction would result in the county not being able to close on the property as scheduled the following day, probably losing out on the property and certainly losing $500,000 in earnest money deposit funds, he noted.
Clay Adkinson, TDC attorney, added that the county’s decision to purchase the property had been accompanied by a legislative finding that he believed was subject to the doctrine of sovereign immunity. Attorney generals have repeatedly deferred decisions on uses of TDT funds to local governments as legislative findings, he continued.
Dunaway argued that without the injunction, “the status quo cannot be maintained.”
“We would ask that the injunction be granted,” he said to Judge Santurri.
Observing that this was a “very complicated subject,” Judge Santurri agreed with the county’s argument that the use of the funds could not result in irreparable harm— and that a remedy would be available in the form of replacing the TDT funds with general funds if necessary.
“There is a likelihood that this case could go either way,” Santurri observed in reference to the “prong” of substantial likelihood of success on the merits of the case.
He said he did not believe that the plaintiffs had demonstrated that the requirements for a temporary injunction were met.
“So I am going to deny the temporary injunction at this point,” Judge Santurri ruled.
In the representative form of government, courts are required to give deference to legislative findings of governmental bodies, he continued.
Judge Santurri said he did not doubt O’Krepki’s concerns, but added that the mere fact that the county purchases the property does not mean that it will be used in the manner that is the subject of the homeowner’s concern.
A “real question” about standing exists in connection with the case, the judge commented, which can be addressed at a later date.
Dunaway then requested a stay of the county purchase pending appellate review of the judge’s denial of the injunction.
Judge Santurri responded that, while he would welcome the appellate review, granting the stay would be “akin” to approving the temporary injunction. He denied the request for a stay.
Walton County finalized the purchase of the property at a Sept. 15 closing as scheduled, with the legal challenge concerning the property purchase to continue in Walton County Circuit Court.