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Agenda 10/14/2014 Item # 12B 10/14/2014 12.B. EXECUTIVE SUMMARY Recommendation to approve a stipulated settlement as it relates to OGC File No.: 14-0012, in The Division Of Water Resource Management: Collier County and Collier County Water- Sewer District v. Florida Department of Environmental Protection, and Dan A. Hughes Company, L.P. OBJECTIVE: That the Board of County Commissioners (Board) approves the attached Stipulation and withdraws from current litigation against the Florida Department of Environmental Protection (FDEP) and Dan A. Hughes Company, L.P. CONSIDERATIONS: At its September 9, 2014 regular meeting, the Board heard a presentation by FDEP Secretary Herschel Vinyard concerning the history of Florida's oil program, protections that are in place to ensure the safety of Collier County residents, and additional protections that may be put in place. Secretary Vinyard also updated the Board on the FDEP's actions against the Dan A. Hughes Company (Hughes). Based on the presentation, and certain commitments made by Secretary Vinyard, the Board directed the County Attorney to commence the process of dropping the County's lawsuit against the FDEP so that the County and the FDEP could forma partnership not only in the litigation against Hughes, but also in the development of new legislation regarding oil drilling. The Board's decision to withdraw from the lawsuit, however, was predicated on Secretary Vinyard confirming the commitments made by him during the presentation in writing. During the Board's discussion on September 23rd of Item 12B, in which the County Attorney sought direction as to whether to intervene in FDEP's litigations against Hughes, it was felt that additional clarifications on Secretary Vinyard's letter to the Board of September 12th were necessary. In the proposed Stipulation, FDEP makes certain commitments to the County in exchange for the County dropping its Petition. The agreement incorporates the commitments made to the County in Secretary Vinyard's letter of September 12th, with several clarifications to address concerns that have been raised. I have also included a copy of the transcript of FDEP's presentation. FISCAL IMPACT: None. GROWTH MANAGEMENT IMPACT: None. LEGAL CONSIDERATIONS: The County Attorney has reviewed this item and approved it as to form and legality. Majority support of the Board is required for approval. - JAK RECOMMENDATION: That the Board approves a stipulated settlement as it relates to OGC File No.: 14-0012, in The Division Of Water Resource Management: Collier County and Collier County Water-Sewer District v. Florida Department of Environmental Protection, and Dan A. Hughes Company, L.P. PREPARED BY: Jeffrey A. Klatzko ■. County Attorney Packet Page -621- 10/14/2014 12.B. COLLIER COUNTY Board of County Commissioners Item Number: 12.12.B. Item Summary: Recommendation to approve a stipulated settlement as it relates to OGC File No.: 14-0012, in The Division Of Water Resource Management: Collier County and Collier County Water- Sewer District v. Florida Department of Environmental Protection, and Dan A. Hughes Company, L.P. This item is a companion to Item 12A. Meeting Date: 10/14/2014 Prepared By Name:NeetVirginia Title: Legal Assistant/Paralegal, CAO Office Administration 10/8/2014 11:20:24 AM Approved By Name: KlatzkowJeff Title: County Attorney, Date: 10/8/2014 11:34:46 AM Name: IsacksonMark Title: Director-Corp Financial and Mngmt Svs, Office of Management&Budget Date: 10/8/2014 11:47:48 AM Name: KlatzkowJeff Title: County Attorney, Date: 10/8/2014 1:14:29 PM Name: OchsLeo Title: County Manager, County Managers Office Date: 10/8/2014 2:28:57 PM Packet Page -622- 10/14/2014 12.B. BEFORE THE STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION COLLIER COUNTY and COLLIER IN THE DIVISION OF COUNTY WATER-SEWER DISTRICT, WATER RESOURCE MANAGEMENT Petitioners, OGC File No.: 14-0012 v. FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION, and DAN A. HUGHES COMPANY, L.P., Respondents. STIPULATION This Stipulation is hereby entered by and between Collier County and the Collier County Water-Sewer District, the Petitioners, and the Florida Department of Environmental Protection, a Respondent, as of this day of October, 2014. In consideration of Petitioners withdrawing their Petition (June 12, 2014) and Amended Petition (July 1, 2014), the Florida Department of Environmental Protection (hereinafter referred to as "FDEP") hereby agrees as follows: 1. The commitments set forth in Secretary Vinyard's letter dated September 12, 2014 to the Collier County Board of County Commissioners, a copy of which is attached as Exhibit A, are hereby reaffirmed and incorporated by reference into this Stipulation as if fully set forth below. 2. One of the commitments in Secretary Vinyard's letter is that "[T]he Department will seek additional legislative authority to further strengthen our existing oil program regulations. This will include updating the current statutes to address new technologies and include greater protections. The Department commits to work collaboratively with the County to address its concerns as the legislative process moves forward." To clarify, FDEP confirms that this commitment covers all current oil well technologies, including the activities, technologies and processes engaged in by the Dan A. Hughes Company at the Collier-Hogan well site, including but not limited to those commonly referred to by the public as "fracking" or"acid fracking." 1 Packet Page -623- 10/14/2014 12.B. 3. With respect to Secretary Vinyard's commitment regarding Legislative and Regulatory Actions, FDEP agrees that it will actively seek out, engage and work with all of the stakeholders in Collier County with respect to proposed legislative and regulatory changes, including but not limited to Collier County, the Collier County Water-Sewer District, The Conservancy, Collier Resources Company, as well as any other affected land owners. 4. Petitioners will file a Notice of Dismissal of their Petition within 5 business days of the full execution of this stipulation. IN WITNESS WHEREOF, the undersigned have executed this stipulation as of the date first set forth above. COLLIER COUNTY: ATTEST: BOARD OF COUNTY COMMISSIONERS DWIGHT E. BROCK, Clerk COLLIER COUNTY, FLORIDA By: By: , Deputy Clerk TOM HENNING, CHAIRMAN STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION By: Hershel T. Vinyard Jr. Secretary Approved as to form and legality: Jeffrey A. Klatzkow County Attorney Packet Page -624- =BIT A 10/14/2014 12.B. rani FLORIDA DEPARTMENT OF Rt ENVIRONMENTAL PROTECTION �.�; ; . i , no . ,A MARJORY STONEMAN DOUGLAS BUILDING 3900 COMMONWEALTH BOULEVARD TALLAHASSEE.FLORIDA 32399-3000 '�` • September 12, 2014 Collier County Board of Commissioners 3299 Tamiami Trail East Suite 303 Naples, Florida 341 12 Dear Collier County Commissioners: It was a pleasure to be with you at this week's Collier County Commission meeting. I am grateful for the opportunity the Commission afforded me to discuss all the actions that the Florida Department of Environmental Protection (Department) is taking to protect the families and incredible natural resources of Collier County. The issues that we discussed regarding oil production and the protection of the groundwater resources are of the utmost importance, and I appreciate the clear message that the Commission sent in its desire to work collaboratively with the Department. I want nothing more than to work in a transparent and open manner with you—our local partners—for the benefit of the citizens and the environment. As I relayed to the Commission, the Department has been hard at work over the summer, taking action to hold Dan A. Hughes legally accountable, but we will not wait for the outcome of that litigation to seek out and eliminate any threats to groundwater resources. That is why the Department has already begun groundwater testing and investigation, starting with the drilling of six shallow monitoring wells. The Department will also undertake numerous additional protective measures at our own expense in the coming months. As requested by the Commission. I would like to formally commit in writing to the additional action items the Department will be taking to address the County's concerns, pertaining both to the Collier-Hogan well and legislative and regulatory proposals. Actions to Address the Collier-Hogan Well Later this month,the Department will install a 1,850 foot groundwater monitoring well to the base of the "underground source of drinking water.- The location of the deep well will be downgradient of the Collier-Hogan well to be certain any contamination is detected. Water quality testing in this deep well will be completed. and sampling Iab results will be released to the County and the public as soon as results are available. Packet Page -625- 10/14/2014 12.B. Collier County Commissioners Page 2 September 12, 2014 Additionally, the Department will perform analysis of the flowback material produced at the Collier-Hogan well, immediately upon obtaining adequate samples of the material. The Department will use all legal means to obtain samples of the flowback material and analysis of the materials from any available sources. The Department will also investigate and address how Dan A. Hughes treated and disposed of the flowback material. The Department is hiring a team of independent third-party experts—with no ties to the Dan A. Hughes Company or Collier Resources Company—to assess the activities that took place at the Collier-Hogan well and determine whether those activities present any concern to the groundwater resources in Collier County. We will provide the County the opportunity to consult with the Department on the selection of the third-party experts and will ensure that the County's experts have the ability to collaborate with our experts in this endeavor. As part of the work of the third-party experts, the Department will require an analysis of the two plugged wells nearby the Collier-Hogan well (Gulf Coast Realty Corporation C 1 Well. Permit Number 86 and Gulf Coast Realty Corporation E l Well, Permit Number 103). The analysis will include an assessment of whether the two wells could have been affected by the Collier-Hogan well,whether they present any concern of contamination to the underground source of drinking water and whether re-entering those old wells is recommended. If, at any time, contamination of groundwater is discovered related to the Collier-Hogan well, the Department will seek full assessment and remediation of the contamination, as required by its legal authorities to protect public or private water sources. Legislative and Regulatory Actions The Department will seek additional legislative authority to further strengthen our existing oil program regulations. This will include updating the current statutes to address new technologies and include greater protections. The Department commits to work collaboratively with the County to address its concerns as the legislative process moves forward. As part of this process, we will seek to increase the maximum penalty amounts available, to ensure that energy companies like Dan A. Hughes Company will be deterred from engaging in an unauthorized activity. We will seek greater authority from the Legislature to consider operators' prior history of violations in other states as part of the Department's permitting decisions. We will seek additional authority to require the latest technology to conduct real-time well monitoring on a continuous basis for all active wells in Florida. We will also seek to increase the current bond requirements for oil well operators to make certain that, in the event of a spill, there is more than adequate funding to perform complete cleanup and remediation activities. Packet Page -626- 10/14/2014 12.B. Collier County Commissioners Page 3 September 12, 2014 Again,thank you for your support of the Department's efforts to protect our citizens. I want to reiterate what I said at the Commission meeting—the Department will openly support the County should it chose to join us in the litigation that is currently pending against Dan A.Hughes; both our enforcement action in Collier County Circuit Court and the permit revocation action in Tallahassee. I have extended the same offer to the Conservancy of Southwest Florida, should it choose to participate in those actions. I have a deep appreciation for the critical role local government plays in protecting the health, safety and welfare of Florida's residents and the environment. I know by standing together we will guarantee a safe,clean and abundant drinking water supply for Collier County's families. Sincerely, Herschel T. Vinyard Jr. Secretary Packet Page -627- 10/14/2014 12.B. September 9, 2014 Item #5D PRESENTATION BY THE FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION CONCERNING OIL DRILLING IN COLLIER COUNTY TO ADDRESS SAFETY ISSUES, LAWS AND REGULATIONS AND FDEP'S CURRENT AND FUTURE OPERATIONS RELATED TO OIL DRILLING WITHIN COLLIER COUNTY. PRESENTED BY SECRETARY HERSCHEL VINYARD AND FDEP STAFF MEMBERS - PRESENTED; MOTION TO DROP THE COUNTY'S LAWSUIT AGAINST FDEP, FORM A PARTNERSHIP WITH FDEP ONCE THEY PROVIDE A LETTER OF COMMITMENT THAT ADDRESSES THE COUNTY'S ISSUES — APPROVED; MOTION DIRECTING THE CHAIRMAN TO WRITE A LETTER TO COLLIER COUNTY'S LEGISLATIVE DELEGATION TO EXPRESS SUPPORT OF WORKING TOGETHER WITH FDEP AND OTHER INTERESTED PARTIES IN THE DEVELOPMENT OF NEW LEGISLATION REGARDING OIL DRILLING — APPROVED; MOTION FOR THE COUNTY ATTORNEY TO BRING BACK AN EXECUTIVE SUMMARY AT THE SEPTEMBER 23, 2014 BOARD MEETING ON THE PROSPECT OF COLLIER COUNTY JOINING THE LAWSUIT THAT'S BEEN FILED AGAINST THE DAN A. HUGHES COMPANY AND IN ADDITION THE COUNTY ATTORNEY TO NOTIFY AND PROVIDE COUNSEL REPRESENTING THE DAN A. HUGHES A COPY OF THE EXECUTIVE SUMMARY WITH AN INVITATION FOR THEM TO APPEAR AT THE SEPTEMBER 23. 2014 BCC MEETING — APPROVED MR. OCHS: Yes, sir, that takes us to Item 5.D on the agenda this morning. It is a presentation by the Florida Department of Page 1 Packet Page -628- 10/14/2014 12.B. September 9, 2014 Environmental Protection concerning oil drilling in Collier County, to address safety issues, laws and regulations, and FDEP's current and future operations related to oil drilling within Collier County. We're honored this morning, Commissioners, to have Secretary Herschel Vinyard from the DEP here to lead that presentation. Secretary Vinyard? Good morning, sir. CHAIRMAN HENNING: Yeah, actually, we have two items that are similar in nature. If we can hear both of those and then go to questions by the Commissioners, if they have any. Questions, comments. And I think it's apropos to start with Commissioner Coyle, since I can't see if he wants to speak or not. MR. OCHS: Very good. That's a good suggestion. CHAIRMAN HENNING: Is that okay, Commissioners? COMMISSIONER FIALA: Sure. COMMISSIONER NANCE: Yes. CHAIRMAN HENNING: Secretary, welcome to Collier County. SECRETARY VINYARD: Thank you, Mr. Chairman and members of the Commission. It's great to be back. Thank you for having me back, and thank you, Mr. Ochs, for inviting me. I certainly want to appreciate the engagement that DEP and many of the residents of Collier County have had over the summer. I think it's been very, very helpful for DEP and hopefully it's been helpful for the folks here in Collier County. I plan to touch on four items for you today relating to DEP's oil program. First is the history of Florida's oil program. Second, protections that are in place to ensure the safety of Collier County's families. Third, additional protections that may be put into place. And finally, an update on DEP's actions against the Dan A. Hughes Company. First the history of oil exploration in Florida. We spoke last time about our shared passion for the national Paget Packet Page -629- 10/14/2014 12.B. September 9, 2014 resources in Southwest Florida. And we know that the natural resources in this area actually attract folks from around the country to actually move here and live here. One of the things that I've noticed in my multiple trips to Collier County this summer was a lot of our new residents didn't know that Florida was an oil producing state. Actually, Florida has had a long and safe history of oil production. Over 70 years. In fact, in 1941 the Florida legislature authorized and encouraged oil production in our state. They even put out a $50,000 bounty for any company that could bring in a commercially viable oil well. And in 1943 right here in Collier County the first commercially viable oil well was produced. Where is this oil? There are now two regions in the state where we have commercial oil operations. One right here in Southwest Florida, that being Collier, Lee and Hendry County. And then in the western Panhandle, and that's Escambia and Santa Rosa County. We have a rendering. This is -- I thought this would be important to have a rendering of Collier County's geology. And I wanted to walk through just a couple of basics with you. First of all, Collier County's drinking water aquifer is in the first 1,800 feet below the surface. One of the things I think might be important to note is there's not a giant pool of water underneath our feet. It's actually -- kind of show and tell, what we have is about 1,800 feet of lime rock, rock just like this. And it's a porous rock. If you poured water on this rock it would actually absorb the war. It's kind of like a sponge. And the volume of a rock like that is about 20 percent water. And so your drinking water comes from lime rock just like this. And then below the green line on your sheet you have about two miles of impermeable rock like this. Literally it's hard as a rock. Fluids will not pass this kind of rock. And you have two miles of layers and layers and layers of this rock. And after you get down two miles there is oil in Collier County. Page 3 Packet Page -630- 10/14/2014 12.B. September 9, 2014 And just kind of for your mind's eye, we looked and say well, what's a two-mile distance. And roughly it's from right here in this building to the Collier County Airport, to the Naples Airport. We're fortunate that there is a large separation between drinking water supply and oil that exists in Collier County. I want to highlight with you our permitting program and the permitting protections that Florida law requires to ensure safety for your citizens. First, Florida law encourages the avoidance of sensitive lands, sensitive water bodies and endangered species when locating a well. Second, the well site requires a site pad, like the one shown on the photograph. And before there's any oil drilling at all, the site pad has to be constructed. It's typically made out of crushed rock, and it is a barrier between the activities on that site pad and the soil and groundwater beneath it. You might be able to notice in the photograph there's actually also a berm around that entire site pad. And so that if there were a spill that material would be contained on the pad. So ifs an important barrier that we require. Another key permitting requirement is significant well casing. And we're going to touch on that in just a minute. Finally, when oil is no longer produced, wells are required to be sealed with cement. They're required to be sealed with cement at multiple depths to ensure the safety of your aquifer. I want to talk a minute about the well casing. It protects our drinking water source as the well moves down through the geology. It's important to note, this is not one casing but five separate casings made of steel and cement, approximately a half-inch thick. So you have redundant protections required by Florida law for any oil well in Collier County. Next slide. I'm particularly proud of this point. DEP has one of Page 4 Packet Page -631- 10/14/2014 12.B. September 9, 2014 the best, if not the best, well to inspector ratios in the country. The -- we have for every inspector -- yes, ma'am? COMMISSIONER HILLER: Wait a second, the slide keeps jumping back and forth. Who's responsible for moving the slide? CHAIRMAN HENNING: Troy's doing that. MR. MILLER: I've lost my PC here. I have no control over it. My PC has gone out so I have no control and I don't know if it's fighting with -- CHAIRMAN HENNING: Can you help? MR. MILLER: Yes, sir. COMMISSIONER HILLER: Can we pause while Troy is -- SECRETARY VINYARD: This is deja vu. CHAIRMAN HENNING: I know, that's -- COMMISSIONER HILLER: Poltergeist. CHAIRMAN HENNING: Technology doesn't like the agency for some reason. SECRETARY VINYARD: All right. There, we're back. And I'll -- Mr. Chairman, I'll start over on this slide. We have one of the best well to inspector ratios in the country. Very proud of this. For every 40 wells we have a single inspector. And what that means is every well is inspected, visited about 100 times a year. Very, very important. I want to draw your attention to the slide. Typically bigger is better. In this case smaller is better. The shortest bar, Florida, means that we have the best well to inspector ratio. You'll see Texas and New Mexico, their inspectors are required to inspect thousands of wells. So in this case Florida was much, much better than our counterparts. Because of the number of inspectors and inspections, we've been able to prevent harm before impact occurs. And that's very, very important to me. We want to prevent the environmental harm before it occurs. But if you break the rules, we have a number of tools in the Page Packet Page-632- 10/14/2014 12.B. September 9, 2014 toolbox. Including revocation of the permit. One tool that we put on this list, and I think it's important in this particular case, is the cease and desist order. When I signed a cease and desist order on New Year's Eve, it was the first time that a cease and desist order had ever been issued in the history of our oil and gas program. So the issue that occurred in Collier County was very, very, very important to me and DEP. So let's talk a little bit more about holding Dan A. Hughes accountable. As you know, our inspector caught Dan A. Hughes Company performing an unauthorized act on New Year's Eve. And within hours, I issued that cease and desist order, which Dan A. Hughes then violated. We then turned the matter over to our enforcement section where they issued a consent order against Dan A. Hughes, requiring them to spend about $300,000 in testing, sampling, monitoring, fines and penalties. After several months, Dan A. Hughes Company fell behind on the requirements of that consent order. DEP agreed with many of the folks in this room about Dan A Hughes's conduct. We revoked every permit they had in the State of Florida and we filed suit right here in Collier County Circuit Court. Mr. Chairman, I would invite the Commission to join DEP if it wishes in that lawsuit. I've extended a similar invitation to The Southwest Conservancy. DEP is committed to protecting the families of Collier County and the environment here. And while that lawsuit is an important step forward, we're not waiting around for the lawsuit to be completed. We've moved forward. We are taking action. We put together a site investigation team at DEP. As you may know, we've already drilled six groundwater monitoring wells. Fortunately we have not found any contamination at the Collier-Hogan Paae 6 Packet Page -633- 10/14/2014 12.B. September 9, 2014 well site. We're also drilling later this month an 1,850 foot well. If you recall from the southwest geology slide, that is at the very bottom of your drinking water aquifer. Let's be very clear, if there is contamination there we will find it. We're also hiring a team of independent experts to perform a comprehensive study on the Collier-Hogan well site. We want to know what happened at the Collier-Hogan well site. As you know, we had not seen that particular process take place before and so we want to have outside experts to advise us on what happened to your geology and what happened to your groundwater. And after we get the scientific data back that the team of experts will produce, we will let science then dictate what steps we should take with respect to your groundwater, with respect to Dan A. Hughes Company, and what potential statutory changes may be in store next year. Along the way I want to make sure that we receive your input. We would like to be partners in this process. These commitments that we've discussed in the previous slide with respect to the studying and monitoring, testing, and lawsuits, we have also communicated that to Southwest Conservancy. And we appreciate their engagement throughout the summer on this. As we continue to focus on the activities at the Collier-Hogan well site, DEP is also engaged in coming up with ideas to present in this legislative session to strengthen, strengthen DEP's regulatory authority. We will not be encroaching on local zoning authority. We think it's important for local governments to determine where oil wells can be placed in your community. But we see several items where we believe DEP needs greater authority. We think that we should be able to consider the past history of out-of-state violations for applicants Page 7 Packet Page -634- 10/14/2014 12.B. September 9, 2014 seeking permits in Florida. If you're a bad actor in another state, we don't want you in Florida. We want to increase fines for oil companies. DEP wants to be able to fine an oil company more than $10,000 a day. We want to increase the scope of our inspection requirements. We want to use the latest technology for 24/7 monitoring of every oil well in Florida. Finally, increased bonding requirements. If a cleanup is required, the company, not the taxpayers, should be financially responsible for that cleanup. Again, Mr. Chairman, members of the Commission, I would appreciate and welcome your input and partnership with what's going on in the 2015 legislative session, and again, thank you for having me back to Collier County. CHAIRMAN HENNING: Thank you. Now let's go to the next presentation. MR. OCHS: Yes, sir, Mr. Chairman, that's -- CHAIRMAN HENNING: S.B. Page 8 Packet Page -635- 10/14/2014 12.B. September 9, 2014 Item #5E PRESENTATION BY COLLIER RESOURCES COMPANY REGARDING ITS WATER QUALITY TESTING AND MODELING EFFORTS AT THE HOGAN OIL WELL SITE — PRESENTED MR. OCHS: 5.E. And that is a presentation by Collier Resources Company regarding its water quality testing and modeling efforts at the Hogan well site. CHAIRMAN HENNING: And then we'll go to questions and comments. First starting by Commissioner Coyle, then Commissioner Hiller, then Commissioner Fiala. Secretary, be prepared after that to -- there might be some questions for you. MR. OCHS: Commissioners, while they set up, I just would remind the Board, several weeks ago Collier Resources Company sent a letter to the Board telling them that they were going to hire an expert consultant and asked for the county staff to collaborate on the selection of an analysis of the listed five firms that they had submitted. Based on the Board's direction we did that collaboration and came up with a couple of recommendations of what we thought would be the most outstanding firms out of that list. And I believe that Collier Resources Company has taken that suggestion and used one of those firms. CHAIRMAN HENNING: Okay, great. MR. LEWIS: Good morning. I'm Richard Lewis. I'm with Conestoga-Rovers and Associates. And I was asked to look at the geology of the site and understand a little about the chemicals that were present at the site and to prepare a presentation. And that's what I've got. And if you'd like, I'll play it for you. Page 1 Packet Page -636- 10/14/2014 12.B. September 9, 2014 Would the volume be right on this? MR. OCHS: Yes. (A video was played.) MR. LEWIS: Thanks. And I've got just a few slides to confirm a couple of details. CHAIRMAN HENNING: Just make sure you speak into the mic when you talk. MR. LEWIS: Yes, thank you, absolutely. So that presentation hopefully helped to understand some of the geology and movement of chemicals at the site. I want to take a moment to go over just a couple of quick points. Here we see from the presentation the plume, a saltwater plume basically. We calculated this using existing models. The groundwater flow is to the south, southwest. And a number of the chemicals, the salts would move the fastest. Now, based on other sites that we have in the area, the hydraulic conductivities used in this model, which are a way of measuring how fast the water will move, suggests that these are overestimates. And this is a very worst case -- very much a worst case scenario. In any event, the other chemicals such as the acids, the particulates and the salt won't -- I'm sorry, the organics, won't move as fast as the salt will. So let me talk just a bit more about what was injected and what our understanding is. And this was based off of the material received from the DEP about what Dan A. Hughes says was in their mixture. About 90 percent of it was water and sand. There were salts. The primary salt was a potassium carbonate. Carbonate is what would be present in the limestone, like calcium carbonate. And potassium is what would be in fertilizer or vitamins. Too much of it wouldn't be good for you, but it would move with the water. The acid was primarily hydrochloric acid, HC1, like from Page 2 Packet Page -637- 10/14/2014 12.B. September 9, 2014 chemistry class. And although it was much less, the next acid was citric acid, which is what's in citrus fruit. This is the basic chemistry rear. The HCl and the limestone, acid in a base, you mix them together and you make a salt. In this case the HC1 with calcium carbonate makes calcium chloride. And this isn't going to move very far either. Now, why they were doing this originally, mixing the HC1 in, was exactly the same reason that municipal wellfields used this to rejuvenate their wellfield. You might have a case where the wellfield's been producing water for a number of years and because of calcification you can't get as much water out of it. So what they'll do is they'll inject HC1 into the aquifer, it will dissolve some of the calcium carbonate, and now the wellfield will produce more water. The organics, as was described in the video, are divided into two groups. One group are chemicals that stick to soil. And these things would be petroleum distillate and naphtha, things you'd find in oils. But you've got to remember, the reason they're drilling down at 12,500 feet is because it has crude oil in it. So these are going to be some of the same constituents that would be in the crude oil. Now, the chemicals that degrade relatively rapidly, some of the things they inject are ethanol, isopropyl alcohol, methanol, ethylene glycol, these are some of the leading constituents. Ethanol is drinking alcohol. Isopropyl alcohol, methanol or rubbing alcohol. And these things degrade relatively rapid, especially in an aerobic environment, would degrade very rapidly. So that's the nature of some of the chemicals at the site. There are really three ways that potentially something could get to the surface -- I guess four-ways: One is going up directly somehow through the layers; another is through the existing well; another is through the abandoned wells; and another is a release at the surface. So we looked at each of those. Paae 3 Packet Page -638- 10/14/2014 12.B. September 9, 2014 The anhydrite layers, it's difficult to imagine how a molecule could move from 12,500 feet down up through each of these anhydrite layers and then through the boulder zone. When we've sent cameras into the boulder zone, you'll be going down, you see the borehole as it goes down, and it just opens up into an abyss. I mean, you can't see the sides, you can't see anything. So it's a little spooky looking into it. In any event, this is where we put our municipal wastewater and other industrial wastewaters and whatnot. And it's impossible for me to imagine how you can get up through the boulder zone, given the flows in that zone. So from -- without any additional pressure, you know, how can you move chemicals through these anhydrite layers? I can't find a way for that to happen physically. The next, though, is to go through the existing casing of the Collier-Hogan well that was installed. One of the things, and I need to talk about this, is you've got four steel casings. The only pressure is on that internal well. And then you've got four casings. And what this looks like is, is they drill it in, as the video showed, they telescope out. Each one of these, they drill it into a layer and between the outer casing and the next casing they'll fill that with cement. And then they'll drill down further into another layer and then fill with cement. And the idea being is through this addition of cement, hundreds of feet of cement, you don't allow water to be pushed back up through the outer casing. At the bottom of the Collier-Hogan well they put in a packer. And that's right down -- if it's okay, I'll use this. It's right at the -- well, you can't really see it very well. Ri z it at the base where it's blue going horizontally, right there there's a little black packer. And that packer is meant to resist liquids and materials moving back up into that along the borehole. Page 4 Packet Page -639- 10/14/2014 12.B. September 9, 2014 In addition, there are 3,000 feet of cement that are used to plug across that anhydrite zone. It's important to note that if you had a well into that 12,000-foot zone and you had a well into the surficial zone, the difference in the water table elevation that would rise in the two is something on the order of 9,000 feet. Meaning downhill is downhill in this case. If some water got into a well, it would travel down the well and not the other direction. Okay, that brings us to the abandoned wells 86 and 103. I focused on 86 because it's closer and I think that's the one that has been focused on in terms of because of its proximity. One of the things we noted, and it was originally shared with us, that the well was only 200 feet away from the site. Well, we looked at -- current aerial you see on this one, on the left-hand side abandoned well 103, the Collier-Hogan in the middle and the abandoned well 86 on the right-hand side. If we go back to the 1953 aerial, all these wells had roads driven to them. And that's in fact Immokalee Road across the -- horizontally across the bottom. And we can see where these abandoned wells are located. And we've checked it with the DEP and they confirmed these locations. So in fact the abandoned well 86 was 1,000 feet north. And remember the groundwater was traveled to the southwest, so it's up gradient of where the Collier-Hogan well was located. Well, let's look at that abandoned well 86. There are -- as it's drilled in we see the casings, and there's a plug put at the bottom. And what has to happen is there has to be not one failure but multiple failures along the way. The cement plug has to fail, the drilling mud has to fail, there's another cement plug up at about 5,500 feet, that has to fail, and then the mud to the surface has to fail. But not only did they put drilling mud in, they also removed some Page 5 Packet Page -640- 10/14/2014 12.B. September 9, 2014 of the casing. And when you remove the casing in the boulder zone, that's going to be open. You're going to discharge into the boulder zone where we put the treated wastewater and industrial wastewater. And it's difficult for -- based on the knowledge and information I have now, it's difficult to imagine how you travel up that abandoned well and get past the boulder zone. I can't find a physical way for that to happen. Finally, if we were to look at the entire area, you can see the wellfields. And these are 20-year capture zone. So if you're on the outside of that blue area, a little drip of water would take about 20 years to travel to the wellfield from that location. And you can see in the yellow dot the Collier-Hogan well site is about six miles from the -- the nearest down gradient would be the Orange Tree wellfield. We're talking about that only moving, worst case scenario, about 1,500 feet. So it's difficult to ima-- in 10 years. So it's difficult to imagine how that would encounter one of these 20-year capture zones that have been calculated by the water management districts and whatnot. So from that perspective as well, we don't understand in any reasonable period of time how a wellfield would be threatened. And with that, I'll conclude and see if there are any questions. CHAIRMAN HENNING: Thank you. Commissioner Coyle, questions or comments? COMMISSIONER COYLE: Yes, Mr. Chairman. I think this information has been very helpful, and it should be beneficial for the DEP to develop appropriate standards going forward. But I don't see that we can make any decisions concerning this at this point in time. I would suggest that the only request for a decision so far has been such of Vinyard's request that we join them in their suit. And I believe that we should consider that in a properly advertised meeting of the Board of County Commissioners and where we can have an open public debate concerning this. Page 6 Packet Page -641- 10/14/2014 12.B. September 9, 2014 So those are my only comments right now. And I think it's appropriate that the information provided under public petition presentation be considered by the Board for a possible additional hearing at a publicly advertised time. CHAIRMAN HENNING: Okay. Now, that lawsuit has been filed, there has been motions filed within the court. So that process has already begun. Is there any reason that you believe that that action cannot take place by the Board of Commissioners at today's meeting? We have a lot of players that I see in the audience that have commented on this in the past. COMMISSIONER COYLE: You know, I am -- I am reluctant to take an action at a point in time when open public debate is not available. But that's up to the majority of the Board. I don't see how a two-week delay would bother this too much. At the glacial rate in which court cases move, two weeks is probably not going to cause a big problem. CHAIRMAN HENNING: Commissioner Hiller? COMMISSIONER HILLER: Yeah, I have a number of issues. I'd like to start with a quick question and the answer should be yes or no. Dr. George, do you believe -- and would you just step up to the mic? I just want to make sure I have a good understanding of this issue. MR. OCHS: Commissioner, while he's coming up, if I might just interject. On your consent agenda today, as you all know, the County Attorney was authorized to hire an expert that the County Board and staff can utilize to help do analysis on all the various modeling and testing that's going on by a multitude of agencies, including DEP, The Conservancy and certainly the landowner. So George is not an expert. He has background in this, of course, but we have -- or you have hired an expert today to help us evaluate Page 7 Packet Page -642- 10/14/2014 12.B. September 9, 2014 this and do a bit of a gap analysis when the results are in. So I just wanted to kind of lay the foundation for that. COMMISSIONER HILLER: Thank you. And with a full understanding that you do not have your expert on board or maybe you do and you've started only preliminarily addressing this, do you feel that our wellfields are in any way threatened by the drilling that occurred at the Collier-Hogan site? DR. YILMAZ: For the record, George Yilmaz, Public Utilities Administrator. Commissioner, at this time what we do know is much less than what we do not know. And I think we're not alone in this endeavor. You heard from our Secretary Vinyard, they got a lot of homework to do on a logistical front as well as they got work to do -- COMMISSIONER HILLER: I don't want to hear all that. I don't need to know what they need to do. What I care about is whether in your opinion you feel that our wellfields are at risk based on the presentation that was done here today. The presentation that was done here made it very clear that our wellfields will not be reached to any significant degree in the next 10 years. Do you agree with the presentation made by the engineer this morning? DR. YILMAZ: If I might, I think as our County Manager indicated, there are pending studies and data needs to come our way for me to be able to render informed opinion for our governing board. To make appropriate policy decisions would be premature at this time. COMMISSIONER HILLER: So at this point you're not able to say whether or not you agree with the presentation made by the engineer? DR. YILMAZ: At this time I cannot render an opinion, ma'am. COMMISSIONER HILLER: Thank you. Continuing, I listened to the presentation by Mr. Vinyard and by Page 8 Packet Page -643- 10/14/2014 12.B. September 9, 2014 the expert. And I'd like to begin by saying that with respect to DEP's presentation, I want to commend you. Because when you were here last time, as you know, I was not very happy, to say the least. And, you know, I pointedly said that you had done too little too late. The fact that subsequent to our last meeting you have filed suit against the Hughes Company I consider to be an appropriate position on your part, so I commend you for doing that. It is unfortunate that the Hughes Company is not here today. The fact that you have, you know, revoked all of their permits is also a very positive step, and I commend you for that. With respect to your request to join the lawsuit, I absolutely believe we should join that lawsuit. And I don't believe there's any cause for delay. I don't want anything to happen between now and two weeks from now that in any way compromises our ability to protect the interests of this county. So I would say yes, this is a publicly noticed meeting, we have everybody here, and I feel it is absolutely appropriate for this Board to make a decision to join that suit. To that end we have a suit against you right now. And what I would like to do is I would simultaneously like to recommend that we withdraw the suit against you since we are joining you in the suit against the Hughes Company. Which gives us the ability to be a part of that settlement and to ensure that the rights of Collier County and the interests of Collier County are protected. I would like to continue and say that that is not all that's necessary. I think this Board has to take additional action. This Board has to make it part of our legislative priority as part of our message to our legislative delegation that we have to take an aggressive posture on what is going on with respect to regulation and enforcement of that regulation by the state, by your agency. And you, you know, in your outline of regulatory changes talked Page 9 Packet Page -644- 10/14/2014 12.B. September 9, 2014 about standards for drilling and safety. Well, I think there needs to be much more than that. I think it's very nice that you want to impose higher penalties and you want to, you know, continue with strict oversight. But my concern is what is the methodology being used? What type of drilling is being allowed? Why? How? Where? And it is extremely important that we have standards. If fracking does not work for Southwest Florida, then fracking should be prohibited legislatively by the state. It's about the methodology. So I feel that your recommended regulatory changes fall short of what we need done by our state representative. So as part of my motion, and I will be making motions on all these things, I would like to see that we give direction to the legislative delegation to strengthen the regulatory standards as you have suggested in your slide, Secretary, but to add to that, that the State make a determination where fracking shall be permitted and what safeguards will be put in place if fracking is allowed. And I don't have the answer to that because I'm not an engineer, I'm not a geologist, Pm not, you know, whatever you call those, wildcatters, I'm none of the above. I'm just a simple commissioner. Having said that, in fairness, I think it would be nice if the Hughes Company were invited to speak. I mean, we have everybody here, we have the environmentalists here, we have Conservancy here, we have you here, we have the Collier Companies here, we have our delegation here, but we don't have the Hughes Company. And I think as a courtesy they should be invited to speak. I don't believe that making the decision to move forward with this suit against them should be held back in light of that invitation, but I do feel they should be invited. I'd now like to turn to talking a little bit about the discussion, the presentation made by the engineer with respect to plugging the wells. Page 10 Packet Page -645- 10/14/2014 12.B. September 9, 2014 I like what I heard, but I'm not fully satisfied. And the reason is is because the question has come up -- and I'd like to ask the engineer. You know, one of the issues that was raised, and I have to -- in my mind, I very strictly separate the issue of the wells and Hughes's methodology. And I do that because the issue of whether or not these wells are properly plugged was not Hughes's responsibility. So I don't think those two issues should be overlapped and I think it's a false argument to combine the two. So focusing on the issue of the plugging of the wells, you gave a great deal of testimony as to how these wells had been plugged. I mean, layer upon layer upon layer, casing upon casing upon casing. How much has the methodology for plugging these wells changed from the time that these wells were plugged to today? Because what you've demonstrated is, you know, tantamount to creating a vault around, you know, these -- that particular silo or whatever you want to call it. What do you call it? Well? What do you call that? MR. LEWIS: Well abandonment? COMMISSIONER HILLER: Well, whatever, you that -- MR. LEWIS: Drilling mud that they put in? COMMISSIONER HILLER: Well, the point -- I don't know. MR. LEWIS: Sony. COMMISSIONER HILLER: The well. So my point is, is in your opinion has the well been plugged to the degree necessary to protect against any potential invasion from any contaminant source? And what would -- you know, if we were plugging the well today, how much more concrete would we put in and how many more plugs would we put in beyond what's already there? MR. LEWIS: I don't think I'll be very helpful on this. We were doing an update to look at the geology. And I'm a transport person, so I'm looking at how molecules move in the environment. So looking at the boulder zone and looking at the layers. I think that's something Page 11 Packet Page -646- 10/14/2014 12.B. September 9, 2014 that could be looked into. But as I stand here today, I don't think I can help you with that. COMMISSIONER HILLER: Then you're the wrong person for the question. But you're the right person. I figured out that pretty quickly. So you're the one -- DEP was the one who went in and inspected the two wells, correct, and made sure that they were properly plugged? SECRETARY VINYARD: The predecessor agency, yes, ma'am. COMMISSIONER HILLER: And there were no issues with how those wells were plugged in the opinion of DEP at that time or any time from then to the present? SECRETARY VINYARD: That's correct. And we've actually had staff look at the older records that are available to us to confirm that the wells have been properly sealed. Having said that, however, we've included that as a task in hiring this team of independent experts. We want them to also evaluate those two wells to determine is there something more that we should be doing. COMMISSIONER HILLER: And the methodology that was used to plug these wells is the same methodology that was used to plug wells all through that Sunniland area in the past? SECRETARY VINYARD: During that time period, yes, ma'am. COMMISSIONER HILLER: And what is the difference between what was done then and now? SECRETARY VINYARD: More layers of cement plugs in the well. COMMISSIONER HILLER: And how much more protection does that provide? SECRETARY VINYARD: Well, we wanted -- you know, as we've increased our technological capability, what we wanted to do as the rules changed over time is just add more protection for our Page 12 Packet Page -647- 10/14/2014 12.B. September 9, 2014 aquifers. But we do not have any evidence that the plugs that were put into place in the 1940's have failed. COMMISSIONER HILLER: So the plugs haven't failed, and you're not requiring any of the wells that were plugged back in the Forties to be plugged to a higher standard based on the current law? SECRETARY VINYARD: No, ma'am. COMMISSIONER HILLER: And if you did it to one well, you'd have to do it to all the wells throughout Florida. SECRETARY VINYARD: Hundreds of them, yes, ma'am. COMMISSIONER HILLER: Hundreds of them. SECRETARY VINYARD: Probably the best evidence of the integrity of these old wells, really the data that Collier County has submitted to DEP as part of your drinking water permits. Collier County still has some of the cleanest drinking water in the state. COMMISSIONER HILLER: And the best tasting. I just want you to know. We got an award for that. I know, I was there, I saw it happen. SECRETARY VINYARD: So given the number of plugged wells that we have in Collier County, if there were problems you would think that it would show up in the data that's been submitted from the county itself to DEP. COMMISSIONER HILLER: Well, thank you so much. I appreciate that. That really makes me feel a lot better about the situation. Of course I still want to see, you know, whatever evidence you come up with beyond what we have here today, and I do want to see what our experts say with respect to my question to Dr. George, and I expect a full report on that. I would like to make a motion. And the motion I would like to make is that we join you in the lawsuit against the Hughes Company; that we step back from the lawsuit against you; that we make it part of Page 13 Packet Page -648- 10/14/2014 12.B. September 9, 2014 our legislative priority to tell our delegation that we expect that in this legislative session that they do what you recommend, and in addition set standards for whether or not fracking will be allowed and if it will be allowed where and what safeguards will be put in place to protect the public as well as the environment. And that is up to them to decide, not up to us. So when you guys want fracking to stop, you go to the state and you tell your state representatives what you feel and why they should or should not permit it. Because we don't have the legal authority to do anything like that. And then to invite the Hughes Company to come and speak, if they so choose, to give them the opportunity to present, just like you all have had the opportunity to present, in fairness. And that's my motion. CHAIRMAN HENNING: Three separate motions or is that one separate motion? COMMISSIONER HILLER: We can handle it any way you like. CHAIRMAN HENNING: Well, I think it's going to fail miserably if you want to do it in one motion. COMMISSIONER HILLER: Okay, then let's break it up in three motions and I'd like it to succeed on all counts. CHAIRMAN HEIN'NING: Okay. Is there a second to the motion or are we going to -- COMMISSIONER HILLER: Well, three motions. COMMISSIONER FIALA: You've got three. So can you break them apart? COMMISSIONER HILLER: Yeah. So the first motion is that we file suit against the Hughes Company and withdraw from the litigation against DEP. Because we're going to become partners with DEP against Hughes. COMMISSIONER FIALA: I'll second that motion. Page 14 Packet Page -649- 10/14/2014 12.B. September 9, 2014 COMMISSIONER HILLER: Thank you. So why don't we vote on that one first? And again, you know, DEP has revoked Hughes's permits. And DEP is filing suit and any -- I feel it's extremely important that any litigation against Hughes involves us so that we have the ability to be involved when -- and be the beneficiaries of any judge's ruling or any settlement that may ensue. And there's no point to go against DEP if they're our partners in this. MR. KLATZKOW: Can I get clarity? COMMISSIONER HILLER: Yes. MR. KLATZKOW: Matt, would you confirm the actions that are now pending brought by FDEP against Hughes? MR. OCHS: Identify yourself for the record. MR. LEOPOLD: My name is Matt Leopold. I'm the general counsel of the Department of Environment Protection. We have two cases we brought against Dan A. Hughes. One is a circuit court suit here in Collier County, an enforcement suit seeking penalties and injunctive relief. And then secondly a revocation action. It's an administrative proceeding in Tallahassee. COMMISSIONER HILLER: And that's revocation of all the permits. MR. LEOPOLD: That's correct. MR. KLATZKOW: So the motion's for both? COMMISSIONER HILLER: Yes, absolutely. MR. KLATZKOW: Thank you. COMMISSIONER HILLER: And that was my understanding that you, you know, based on the Secretary's presentation that there was a suit in circuit court that you filed on July 18th and that secondly you had revoked all the permits. CHAIRMAN HENNING: Okay. We're going to continue the discussion and then come back to the motion. Okay? Or do you want Page 15 Packet Page -650- 10/14/2014 12.B. September 9, 2014 to do other motions? COMMISSIONER HILLER: Well, I have the two other motions. CHAIRMAN HENNING: Do you want to keep those until we have further discussion? COMMISSIONER HILLER: Well, we can finish one motion at a time. CHAIRMAN HENNING: I'm going to continue with Commissioner Fiala. And I want to say something. Commissioner Nance, do you have anything after? COMMISSIONER NANCE: I have absolutely no trouble joining DEP with the lawsuit against Hughes, although I'm not sure what it's going to add. DEP is clearly and statutorily the agency with regulatory and enforcement authority on the action that they've taken. I fully endorse the action that they've taken, I think it's been very helpful. And of course we've spent a tremendous amount of time discussing this one acute incident, which was the Collier-Hogan well. And a great deal of time has been spent on it, as it should be, and I think the information today is very revealing. However, I'm not quite as anxious as Commissioner Hiller to drop our challenge to the petition with DEP for the simple reason that I am anticipating, expecting and requesting from DEP written assurances that they are going to indeed do some of the things that they've suggested today, which includes putting in additional guidelines, controls, safeguards and oversights. It's nice to request from the legislature additional abilities to fine, inspect and put bonds into place. However, I'm looking beyond this acute incident, as I think most of our citizens are, to the future in Collier County where if the decision is made that drilling is going to continue we are going to have to have additional controls. And this Board has unanimously and repetitively requested a whole series of issues be addressed. We've added -- we've stated those Page 16 Packet Page -651- 10/14/2014 12.B. September 9, 2014 issues on white paper that our Emergency Management Department has put together. Private citizens have come with extensive lists, The Conservancy and others have come forward. So if DEP is prepared to give us written assurances that they are going to do that, then I would consider dropping our challenge to their petition. But I'm not going to just in good faith until I receive solid written and public confirmation that they're going to do this to take that action. I can't support that at this time. CHAIRMAN HENNING: Commissioner Fiala? COMMISSIONER FIALA: Yes. First of all, I just wanted to say, it's heartening to hear the FDEP's excellent, actually, excellent response. It's totally different than what it started out to be months ago. And I think it gives me a lot more confidence in what you're doing. I hear the strength in what you're saying, and I hope that they don't ever change secretaries, because we might have a little problem there. But right now you're heading in the right direction. Yes, there's more work to do, nobody denies that. And it gives me confidence that you're going to take control of this and continue to take control of more of the issues. Because this is -- this concerns the safety of all of our residents. And of course the companies too. You know, they -- I think that they deserve every bit of oversight that you can give them as they move forward. We had heard acid stimulation fluid a number of times during the consultant's presentation. When was that first introduced in Collier County? CHAIRMAN HENNING: Herschel, you want to -- COMMISSIONER FIALA: Fracking, in other words. SECRETARY VINYARD: No, ma'am, the acid work was done decades -- for decades in Collier County. Now, to be clear, the activity that took place at the Collier-Hogan well site on New Year's Eve that we tried to stop Dan A. Hughes company from conducting, we have Page 17 Packet Page -652- 10/14/2014 12.B. September 9, 2014 never seen that before in the State of Florida. COMMISSIONER FIALA: Okay, so we're talking two different SECRETARY VINYARD: Yes, ma'am. COMMISSIONER FIALA: -- fracking methods altogether; is that correct? SECRETARY VINYARD: As the engineer mentioned, the acid is used in a number of ways, including in many communities drinking water wells. So it is an acceptable form of treating not only the drinking water wells but the oil wells as well. But the activities on New Year's Eve were unusual for Florida. We've not seen that before. And of course we will not see that again until the science shows whether or not it's safe for the families and the environment. COMMISSIONER FIALA: So then as we approach the Florida legislature, we have to make sure to differentiate between the two methods, just to make sure that we end what we need to end but not the method that we've been using for our water and so forth. CHAIRMAN HENNING: Well, based upon science. COMMISSIONER FIALA: Right, right. I'm sorry, thank you very much. And, let's see. And also the consultant's presentation speaks of companies that do these and how they cap the wells and so forth. They're talking about reliable companies, honorable companies. And I don't think everybody falls into that category. So how does the DEP plan to check the past performances of these companies in states -- in other states before they give approval for anybody to come to the State of Florida? SECRETARY VINYARD: Ma'am, most states put all of their enforcement actions on line. And actually, we meet every quarter with all the -- my counterparts throughout the southeast. And so there are Paae I8 Packet Page -653- 10/14/2014 12.B. September 9, 2014 opportunities. And we work very closely together with a number of states. And we thought that because that information is publicly available in every state that it would be important for our staff to utilize whether or not if somebody's been a bad actor in another state, let them stay in another state, don't let them come to Florida. COMMISSIONER FIALA: Thank you. And the last comment I wanted to make was I was just in Ohio recently and I had no idea there was so much well drilling going on in Ohio, but it's a huge well drilling operation there, or rather oil operation there. They have not handled it in many cases in the proper way. They're having a lot of water problems now. I think we've done a different job here. I think that the Collier Resources has been working also to make sure that they protect -- they live here -- to protect our community. But we need the safeguards in place to make sure that maybe a company that isn't quite as honorable is denied any access to the oil in our whole state. And I just wanted to tell you, they put out regular pamphlets in Ohio telling the people what's happening to their water and with the fracking and how it's actually changed the composition of the water that is now drinking water that maybe is unsafe in many areas. I got one of those letters over in Ohio. And so I'm just -- I'm glad everybody's keeping track of this. I know that Collier Resources doesn't want to see this happen anymore than the rest of us. But at the same time, we need you there to work with them and to prevent any unscrupulous companies from coming into the State of Florida. Thank you. CHAIRMAN HENNING: Well, I'm not convinced that this new method of extracting more oil is safe. COMMISSIONER FIALA: Yeah, me neither. CHAIRMAN HENNING: You're not going to convince me until you have proven science that acid fracking or this stimulation is safe. Page 19 Packet Page -654- 10/14/2014 12.B. September 9, 2014 However, I do see a different movement. And Commissioner Nance is spot on, the rubber is going to meet the road during lawmaking. And we're only going to get successful laws written in the State of Florida if we all partnership. And that -- COMMISSIONER FIALA: Commissioner Henning, could I add? Just what you said. I totally agree with it. And I'm sorry that I'm interrupting, I don't like to do that. But I think you're right. And we have to prevent any of that -- of fracking that we found to be so damaging to our community. And it should be prevented from coming into the whole State of Florida, so -- CHAIRMAN HENNING: Yeah. Well, some feel that it is, some feel that it isn't. The science needs to be performed on our geology whether it's safe or not. And therefore, you get proper laws for the oversight of such processes, okay. But right now as it is today, I'm not -- I feel that it's not safe. I'm not going to take that position, it's not safe until somebody proves me wrong, and that's going to be proven through science. COMMISSIONER HILLER: At the state level. CHAIRMAN HENNING: Well, at the state level and the local level. Because we're hiring -- we approved hiring knowledgeable experts in this field, okay? So it's going to be checked and double checked. And that's how you make good legislation is through proven science. I'm going to continue, if you don't mind. Partnerships in creating law in Tallahassee is very important. People or groups or government that makes law without partnership is going to fail, okay. And we need to be partnerships with the agency, not fighting the agency. Because now they are proving that they have our best interest at heart by going after Dan A. Hughes. Exactly what we wanted is to shut down that well and let's examine what has happened at that site. Page 20 Packet Page -655- 10/14/2014 12.B. September 9, 2014 And they're doing that through science, they're doing that -- they're hiring -- they're spending -- you know, I talked to Cliff, the Deputy Secretary. They're spending upwards of a million dollars on this issue alone. Okay, they're going to dig deeper, they have tested the surficial surfaces for any contamination. They're going deeper than any other. They're going to verify that those two abandoned wells are safe or not safe and whether they need to be opened up again and be plugged. I mean, that's -- that is showing that we need to be a partner in this. However, I don't agree with the motion. I don't think that we should litigate against Dan A. Hughes, we're doing exactly -- or DEP's doing exactly what we asked them to do and they stopped the process. That's their deal. Our partnership with everybody should be lawmaking, like Commissioner Nance has said. COMMISSIONER HILLER: So do you agree with dropping the lawsuit against DEP, given your position on partnership? CHAIRMAN HENNING: Absolutely I do. As long as they continue to be going after -- COMMISSIONER HILLER: Dan A. Hughes. CHAIRMAN HENNING: -- Dan A. Hughes, yes. And they have committed to that. COMMISSIONER HILLER: So -- I understand where you're coming from. And just so you understand, the reason why I feel we need to join that lawsuit with them -- and they not only have invited us, they've invited Conservancy as well. Conservancy doesn't have the ability to join our suit against DEP, but they would have the ability to join the suit with DEP against Dan A. Hughes. I really think if you look at it from a standpoint of what protects our interest, to make sure that DEP doesn't step back from suing Hughes, if we join them against Hughes we basically have a seat at the table. And so that litigation doesn't go away because now we're a party Page 21 Packet Page -656- 10/14/2014 12.B. September 9, 2014 to it. Which is why I'm recommending it. Now let me just say to your point -- CHAIRMAN HENNING: Let me just say -- COMMISSIONER HILLER: I just want to say that we can always withdraw. CHAIRMAN HENNING: Do you really think that Dan A. Hughes is going to come to the Board of Commissioners when you're suing them? No. COMMISSIONER HILLER: I think they would. DEP -- you know, we went -- let me give you a perfect example. We are point blank in litigation with DEP and I have Secretary Vinyard standing right in front of me today. So I don't agree that Dan A. Hughes would not come. And when Dan A. Hughes comes, what they can say is they can say we followed the law, we did what the current law provides, and that can be their defense. That is what is being debated. But they should be given the opportunity to come, and they should be given equal time to DEP and everybody else to address us. It is up to them to choose to do -- to come or not. And, you know, I just want to add one thing. I don't want to digress from this discussion about the litigation, because I can bifurcate my motion even more, and I don't mind doing that because of what you've raised, and I'm willing to do that. I think it's very important that we as a Board do not imply, because we don't want to taint anyone's business reputation, that Dan A. Hughes had a history of bad acts, that they were drillers with a history of citations from other states before they came to Florida. Because it's my understanding that is not the case. So I don't want that this discussion that we are having with you, Secretary Vinyard, with respect to the idea of making sure that we don't allow drillers that have a bad reputation to drill here be attributed to the Hughes Company, Page 22 Packet Page-657- 10/14/2014 12.B. September 9, 2014 because that would be completely unfair and is not correct. And I think it's important to say it on the record because we don't want to, you know, in any way engage in defamation of their business reputation. That would be improper on our part. I want to go back to the discussion of the litigation. If-- Commissioner Henning, let me bifurcate my first motion again. Let me say that the first motion would be to drop the lawsuit against DEP. And as part of that motion to incorporate what Commissioner Nance has proposed is that we receive -- and I would like to talk to DEP's counsel. Would you mind stepping up to the podium? I as the rest of the Board completely understand that you can only do what the law provides. So what we are asking you to do with respect to ensuring that our interest with respect to all these wells is treated by you to the highest possible degree under the law, could you commit to in a letter to us, in a commitment letter to us, that you will do the utmost necessary -- or the utmost that the law allows as it currently stands to ensure that these wells are all properly plugged and that, you know, the safeguards are in place, that if there is anything leaking from this one fracking incident that it would not be able to penetrate those two wells that are each a mile apart? MR. LEOPOLD: Sure. First of all, you know, I'm a counselor and, you know, that's ultimately the Secretary's decision. But we are looking at those wells to see if they're properly plugged. And that's something we're going to look to our outside expert to help advise us on. But it's definitely something we're going to be pursuing, absolutely. COMMISSIONER HILLER: Then you will make the commitment -- Secretary, would you make the commitment that you will do the utmost permitted under law to ensure that these wells are properly plugged? SECRETARY VPNYARD: Yes, ma'am. Page 23 Packet Page -658- 10/14/2014 12.B. September 9, 2014 Be very, very clear, that will be part of the mission of our team of outside experts. So that way you not only would have DEP experts looking at this, and we have a number of experts in-house, but we will also be asking the professional geologists and professional engineers that we'll be hiring to look at these two wells, yes, ma'am. COMMISSIONER HILLER: Then I'm going to bifurcate my motion and I will change that motion from being to withdrawing from the litigation and joining you in the Hughes litigation to -- for the first motion to withdrawing from the -- that the Board of County Commissioners will withdraw from the litigation against DEP, we will work with you as partners, and that in turn you will give us, before we withdraw, before our counsel officially withdraws, that you will give us a commitment letter that provides you will do exactly what you said, that you will do the utmost under the existing law to ensure that those wells are properly plugged. Is that acceptable? COMMISSIONER NANCE: Well, I would like to further ask Secretary a question. COMMISSIONER HILLER: Is that acceptable? CHAIRMAN HENNING: No, the commitment should be that DEP will work with Collier County and create a new legislation of regulation of oil wells, okay. Collier County -- or the DEP will continue its quest to hold Dan A. Hughes accountable for their actions to the courts. And DEP will commit that -- of testing and verifying that the action Dan A. Hughes made at this site has not affected natural resources and our drinking water. COMMISSIONER HILLER: Can you do that, Secretary? I really like the way -- SECRETARY VINYARD: All the County Commissioners -- COMMISSIONER HILLER: -- you said that. That's well said, Commissioner. SECRETARY VINYARD: If there's contaminate at the Page 24 Packet Page -659- 10/14/2014 12.B. September 9, 2014 Collier-Hogan well site, nobody wants to find that more than me. CHAIRMAN HENNING: Right. That's your job. SECRETARY VINYARD: That's my job. COMMISSIONER HILLER: That's what you get paid the big bucks for. CHAIRMAN HENNING: But the commitment is further legislation. Commitment is continue holding Dan A. Hughes accountable through the courts. And if we can get that in a letter, I can support the motion. COMMISSIONER HILLER: Then I amend my motion. Commissioner Fiala, would you amend your second? COMMISSIONER FIALA: Yes. COMMISSIONER HILLER: All right, so we'll start with that. Commissioner Nance? COMMISSIONER NANCE: Yes, let me continue. Mr. Secretary -- CHAIRMAN HENNING: Are you conducting this -- COMMISSIONER HILLER: It would be my pleasure. You know I'd like nothing more. COMMISSIONER NANCE: Mr. Chairman, who has the floor? CHAIRMAN HENNING: You have the floor, and we're going to stick with the motion. After that call the motion and then take a break for the court reporter. Go ahead, Commissioner Nance. COMMISSIONER NANCE: Yes. Mr. Secretary, I'm going to make this a little bit stickier by just hypothesizing on the worst case scenario. Let's assume that a horrific thing happens and that in your suit with Dan A. Hughes Company DEP does not prevail. My concern is what happens under those circumstances. And that is why I'm asking additionally on the commitment letter that has been proposed by Commissioner Hiller and likewise by Chairman Henning that you Page 25 Packet Page -660- 10/14/2014 12.B. September 9, 2014 address a little bit about additional guidelines, controls and safeguards and oversights going forward. I think that's what our community is looking for. I'm very satisfied with your increased activity on this incident, as I've stated before. I am very thankful for DEP. I think your presentation today was revealing, it was on point and it helped everybody understand what's going on. Would you comment briefly on specifically what Collier County residents and this Board can expect from your agency going forward regarding the development of appropriate regulations on this new technology, should you decide that it's appropriate and that it will happen in the future? What can you -- can you add that to your letter and communication to us? SECRETARY VINYARD: Yes, sir, Commissioner. First of all, as the Chairman said, we will be a slave to science. As I mentioned, the third-party team of experts that we're hiring will collect the science and that will dictate what steps we believe we need to take moving forward. We're starting to collect on their best practices as far as rules in other states, and then we will assemble some recommendations to discuss with the legislature. Now, what you may not know is before rules can be changed, DEP rules can be changed, once the economic impact exceeds a million dollars in the State of Florida, we're required to get legislative approval of those rules. So I don't have a magic wand. I must get approval from the legislature. COMMISSIONER NANCE: But are you willing to engage all the stakeholders in Collier County, including county government, our consultants, outside parties of interest such as The Conservancy and the property owners, Collier Resources, in this endeavor? SECRETARY VINYARD: Sir, I welcome that. Page 26 Packet Page -661- 10/14/2014 12.B. September 9, 2014 COMMISSIONER NANCE: Will you so state? SECRETARY VINYARD: I so state and I welcome working together in partnership to find what's best for Florida. COMMISSIONER NANCE: Well then Mr. Chairman, I can support Commissioner Hiller's motion. After a long discussion, I appreciate the time we've taken on this issue and I can support the motion under those circumstances. CHAIRMAN HENNING: Commissioner Coyle, do you have anything before we take a vote and go to a break? COMMISSIONER COYLE: No. I support joining the state in this lawsuit. But this long debate that we've had is certainly a good example of why we should take two weeks and think about this and get all of our concerns addressed. But if the -- MEMBERS OF THE AUDIENCE: Yes. COMMISSIONER COYLE: -- majority of the Board wants to proceed at this point in time, I will not stand in the way. CHAIRMAN HENNING: All in favor of the motion, signify by saying aye. COMMISSIONER FIALA: Aye. CHAIRMAN HENNING: Aye. COMMISSIONER HILLER: Aye. COMMISSIONER COYLE: Aye. COMMISSIONER NANCE: Aye. CHAIRMAN HENNING: Any opposed? (No response.) CHAIRMAN HENNING: Motion carries unanimously. Page 27 Packet Page -662-