Luke, Ronald T. Ph.D.

Deposition from SWIM Challenges

Case No. 92-3038, 92-3039, and 92-3040


	STYLE: CASE: 92-3038, 92-3039, 92-3040 REPORTER: DATE: NAVIGATION:

Division of Administrative Hearings

Department of Administration, State of Florida

SUGAR CANE GROWERS COOPERATIVE
of FLORIDA; ROTH FARMS, INC.; and
WEDGWORTH FRMS, Inc.,

Petitioners,

SOUTH FLORIDA WATER MANAGEMENT
DISTRICT, an agency of the State
of Florida; et al.,

Respondents.

FLORIDA SUGAR CANE LEAGUE, INC.;
UNITED STATES SUGAR CORPORATION;
and NEW HOPE SOUTH, INC.,

Petitioners,

SOUTH FLORIDA WATER MANAGEMENT
DISTRICT, an agency of the State
of Florida; et al.,

Respondents.

FLORIDA FRUIT and VEGETABLE
ASSOCIATION; LEWIS POPE FARMS;
W.E. SCHLECHTER & SONS, INC.,
and HUNDLEY FARMS, INC.,

Petitioners,

SOUTH FLORIDA WATER MANAGEMENT
DISTRICT, an agency of the State
of Florida; et al.,

Respondents.

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DOAH Case
No. 92-3038

DOAH Case
No. 92-3039

DOAH Case
No. 92-3040

VOLUME I
DEPOSITION OF RONALD T. LUKE Ph.D.

Taken before Rachel W. Bridge, Professional
Reporter and Notary Public in and for the State of
Florida at large, pursuant to notice of taking
deposition filed by the Plaintiffs in the above
cause.

- - -

Thursday, January 7, 1992
319 Clematis Street, Suite 500
West Palm Beach, Florida 33401
10:00 a.m. - 5:05 p.m.

APPEARANCES:

On behalf of the Petitioners Florida Sugar
Cane League, Inc., United States Sugar Corp.,
and New South Hope, Inc.:
        Peeples, Earl & Blank, P.A.
        One Biscayne Tower, Suite 3636
        Two South Biscayne Boulevard
        Miami, Florida 33131
        By:    MARK T. KOBELINSKI, ESQUIRE

On behalf of the Respondent SFWMD:
        South Florida Water Management District
        3301 Gun Club Road
        West Palm Beach, Florida 33416-4680
        By:    JACQUELYN W. BIRCH, ESQUIRE

On behalf of Sugar Cane Growers:
Hopping, Boyd, Green & Sams
123 South Calhoun Street
Tallahassee, Florida 32301
By:    GARY V. PERKO, ESQUIRE

Also Present:    Morris Rosen
                        Andrew MacNeil

- - -

I N D E X

- - -

WITNESS:	DIRECT	CROSS	REDIRECT	RECROSS
WOSSENU ABTEW, Ph.D.
BY MR.PERKO	4
BY MR. KOBELINSKI		70

	E X H I B I T S
NUMBER	PAGE	DESCRIPTION
ABTEW EXHIBIT 1	5	Resume of Wossenu Abtew, Ph.D.
ABTEW EXHIBIT 2	21	Draft of EAA Water Budget Analysis 1979 - 1990
ABTEW EXHIBIT 3	23	Draft of EAA Water Budget Analysis
ABTEW EXHIBIT 4	32	Evapotranspiration Estimation Method for South Florida
ABTEW EXHIBIT 5	51	Draft of Everglades Research Plan 7-10-92
ABTEW EXHIBIT 6	53	Statistical Analysis of Drainage Generation from the EAA
ABTEW EXHIBIT 7	59	Memo of 10-26-92 from Ray Santee and others to Leslie Wedderburn
ABTEW EXHIBIT 8	61	Memo of 9-30-92 from L. Wedderburn to Distribution List
ABTEW EXHIBIT 9	62	Memo of 10-6-92 from J. Mulliken to Kenneth G. Ammon
ABTEW EXHIBIT 10	66	May 1992 Draft of Water Budget Analysis for the Holey Land
ABTEW EXHIBIT 11	149	Memo of 8-16-91 from Todd Tisdale to Shawn P. Sculley
ABTEW EXHIBIT 12	165	Memo of 8-27-91 from J. Obeysekera to Tony Federico

University of Miami School of Law Library
Archives and Special Collections
1311 Miller Drive
Law Library, Room 489
Coral Gables, Florida 33146
Telephone: (305) 284-4093

2 STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

3 VOLUME 1

PAGES 1 - 83

SUGAR CANE GROWERS COOPERATIVE CASE NOS. 92-3038

5 OF FLORIDA a Florida Agricultural 92-3039

Cooperative Marketing Association; 92-3040

6 ROTH FARMS, INC.; and WEDGWORTH

FARMS, INC.,

7 and

FLORIDA SUGAR CANE LEAGUE, INC.;

8 UNITED STATES SUGAR CORPORATION,

and

9 FLORIDA FRUIT AND VEGETABLE

ASSOCIATION; LEWIS POPE FARMS;

10 W.E. SCHLECHTER & SONS, INC.;

and HUNDLEY FARMS, INC.,

11 Petitioners,

12 vs.

13 SOUTH FLORIDA WATER MANAGEMENT

DISTRICT, an Agency of the State

14 of Florida,

Respondent,

and

THE UNITED STATES OF AMERICA;

17 MICCOSUKEE TRIBE OF INDIANS;

THE FLORIDA DEPARTMENT OF

18 ENVIRONMENTAL PROTECTION;

THE FLORIDA WILDLIFE FEDERATION;

19 THE FLORIDA AUDUBON SOCIETY,

and THE SIERRA CLUB,

20 Respondent-Intervenors.

_________________________________/

DEPOSITION OF RONALD T. LUKE, Ph.D.

23 ACCURATE STENOTYPE REPORTERS, INC.

100 Salem Court

24 Tallahassee, Florida 32301

(904) 878-2221

25 1-800-934-9090

1 __________________________________________________________

2 DEPOSITION OF: RONALD T. LUKE, Ph.D.

3 TAKEN AT THE INSTANCE OF: Respondent-Intervenor USA

4 DATE: Thursday, March 3, 1994

5 TIME: Commenced at 9:20 a.m.

Adjourned at 5:20 p.m.

LOCATION: 315 South Calhoun

7 Tallahassee, Florida

8 REPORTED BY: MICHELLE SUBIA

Notary Public in and for the

9 State of Florida at Large

__________________________________________________________

APPEARANCES

REPRESENTING THE SUGAR CANE GROWERS COOPERATIVE,

12 ROTH FARMS, and WEDGWORTH FARMS:

13 CAROLYN S. RAEPPLE, ESQUIRE

Hopping, Boyd, Green & Sams

14 123 South Calhoun

Tallahassee, Florida 32301

REPRESENTING THE UNITED STATES OF AMERICA:

KEITH E. SAXE, ESQUIRE

17 United States Department of Justice

601 Pennsylvania Avenue, N.W.

18 Room 879

Washington, D.C. 20004

REPRESENTING THE DEPARTMENT OF

20 ENVIRONMENTAL PROTECTION:

21 GARY SMALLRIDGE, ESQUIRE

Florida Dept. of Environmental Protection

22 2600 Blair Stone Road

Tallahassee, Florida 32399-2400

ALSO APPEARING:

Lonnie Jones

25 Ronald Lacewell

1 I N D E X

3 WITNESS PAGE

RONALD T. LUKE, Ph.D.

Direct Examination by Mr. Saxe 4

9 E X H I B T S

11 NUMBER DESCRIPTION PAGE

12 Luke 1 Analysis of SWIM Plan 11

Luke 2 Tables From EAA Model 45

13 Luke 3 Hazen & Sawyer Cont. Comp. Report 54

Luke 4 Appendices 1 54

14 Luke 5 Appendices 2 54

21 CERTIFICATE OF OATH 83

22 CERTIFICATE OF REPORTER 83

1 PROCEEDINGS

2 The following deposition of RONALD T. LUKE, Ph.D.

3 was taken on oral examination, pursuant to notice, for

4 purposes of discovery, and for use as evidence, and for

5 other uses and purposes as may be permitted by the

6 applicable and governing rules. And reading and signing

7 is waived.

8 * * *

10 Thereupon,

11 RONALD T. LUKE, Ph.D.

12 was called as a witness, having been first duly sworn,

13 was examined and testified as follows:

14 DIRECT EXAMINATION

15 BY MR. SAXE:

16 Q Dr. Luke, for the record I'm Keith Saxe, an

17 attorney with the U.S. Justice Department. And I

18 represent the United States in the action of Sugar Cane

19 Growers Cooperative of Florida versus South Florida Water

20 Management District.

21 We have met before of course. I took your

22 deposition in this case in March of '93. I'll be

23 continuing that deposition today and tomorrow and if

24 necessary on some future date.

25 As before, I'll be asking you a series of

1 questions. And you are required to give me your complete

2 and honest answer to each question unless the attorney

3 representing you instructs you not to answer.

4 If for any reason you do not understand a

5 question, please tell me.

6 Dr. Luke, would you please state your full

7 name and home address for the record.

8 A It's Ronald Thomas Luke. And my home

9 address is 500 Harris Avenue in Austin, Texas.

10 MR. SAXE: Carolyn, if you had some recent

11 or late responsive documents to produce to us,

12 maybe this would be a good time to do it since I

13 would like to do just some preliminary questions

14 of Dr. Luke about the document productions.

15 MS. RAEPPLE: Yes. The first document that

16 I have for you today are some notes that Dr. Luke

17 prepared to organize his thoughts on some of the

18 opinions that he's developed. And the second set

19 of documents are some spreadsheets again

20 reflecting some of Dr. Luke's materials and

21 thoughts in organizing himself to support a number

22 of the opinions that he's developed in this

23 proceeding.

24 MR. SAXE: Okay. We've received documents

25 over the last approximately two weeks from Dr.

1 Luke. And we also received yesterday some

2 production of maybe eight or nine inches of

3 documents or so.

4 We have not had time to really review those

5 documents sufficiently at this point to make use

6 of them in this deposition. I don't know without

7 having done that yet whether we would need to.

8 But I anticipate one of the needs that might arise

9 as we conclude the two days we've set aside in

10 this stretch might be for some continuation of

11 this deposition concerning those late produced

12 documents.

13 MS. RAEPPLE: I understand that. And to the

14 extent that can be accommodated during the

15 discovery period that remains, we'll work with you

16 on it.

17 MR. SAXE: Okay. That's appreciated.

18 BY MR. SAXE:

19 Q Dr. Luke, I have here just a general

20 collection of the documents, a copy of the documents that

21 I believe you produced this last month of February in

22 response to the deposition notice duces tecum.

23 I would just like you to take a quick look

24 at the stack, take a minute or however long you need to

25 just go through it to get a general sense of the order

1 that the documents are in so that we can save some time

2 later in the deposition when I ask you questions about

3 documents you'll know where in that set they might fall

4 so you can get to them quickly.

5 And also if you would as you look though,

6 could you see whether you notice anything that appears to

7 be missing from the production you understand was made

8 for your documents before these last few days. Take some

9 time to go through them.

10 Understandably you might not spot a memo or

11 a small document or a minor matter. But if there was a

12 major report or something else that you had expected

13 would have been produced and isn't in that pile, I would

14 need to know about that.

15 A Okay. It's my understanding that we were

16 not producing to you in that set of production any

17 published documents. So you are not asking me if they

18 are here, you are just asking me about things that we

19 intended to produce copies of?

20 Q Counsel for the co-op has sent me a number

21 of letters in which she has addressed that issue. And

22 she has indicated that -- let me see if I can find the

23 letter.

24 Well, in any case, in communication with

25 counsel I do understand that certain voluminous published

1 public materials, publicly available materials from your

2 library that are responsive were not produced. And we

3 subsequently requested copies of specific items which I

4 understand have been produced.

5 A Right.

6 Q So those would be excluded from that set.

7 A Okay. I would also mention that since that

8 production was done, I've had an opportunity to review

9 substantial portions of a book called "Everglades, The

10 Ecosystem And It's Restoration." And that's had some

11 effect on the opinions that I would express to you today.

12 And I also had an opportunity to look at the

13 1986 Corps of Engineers' study of the system. I haven't

14 read it page for page but have had a chance to review

15 selected sections of it that would also have some effect.

16 Q I think you indicate that you reviewed some

17 substantial portions of the Ogden, Davis book,

18 "Everglades." Could you just quickly maybe from the

19 table of contents focus me on those sections that you

20 focused on in formulating your opinions?

21 A Yes. I think I have at least scanned all of

22 the chapters except those under Section 4. And in

23 Section 4, I just looked at Chapter 28. But other than

24 that, I believe I've at least scanned each of them.

25 Q Okay.

1 MS. RAEPPLE: Mr. Saxe, in reviewing my

2 materials, I have just come across another

3 document that I intended to produce to you today.

4 It's an excerpt from the Brown & Caldwell

5 Consultants report on the Everglades Protection

6 Project Contract C-3051 Amendment 6 Draft Report

7 which was submitted to the South Water Management

8 District May 13, 1993.

9 MR. SAXE: Okay. Thank you very much.

10 BY MR. SAXE:

11 Q Dr. Luke, I'm going to hand you a document.

12 And would you read for the record the title of the

13 document, the case numbers that are referred to and the

14 date of the document on Page 15, the title being toward

15 the bottom of the document, the underlined title.

16 A "Designation of Expert and Fact Witnesses

17 that Petitioner, Sugar Cane Growers Cooperative of

18 Florida, Roth Farms, Inc. and Wedgeworth Farms, Inc."

19 Q And the case numbers on that front cover?

20 A 92-3038, 92-3039 and 92-3040.

21 Q Okay. And on Page 15 of the document, for

22 the record would you read that document date.

23 A February the 8th, '94.

24 Q Very good. During the deposition by the

25 way, I'll refer to the Sugar Cane Growers Cooperative,

1 Wedgeworth Farms and Roth Farms just generally as the

2 cooperative.

3 A Okay.

4 Q Have you seen this document before?

5 A I don't know if I've seen this specific one.

6 Q Do you recognize the document? Do you

7 recognize the purpose of the document?

8 A Well, I mean I know what a designation of

9 witnesses is.

10 Q Okay. Do you understand that's the

11 cooperative's designation of expert witnesses most

12 recently filed in this case?

13 A If you say it's the most recently, I'll take

14 your word for it.

15 Q Okay. Very good. You are aware that the

16 cooperative identifies you as an expert witness that they

17 intend to call at trial in this case?

18 A Yes. I'm aware of that.

19 Q Okay. Would you look for me at Page 4 of

20 that document.

21 A Okay.

22 Q Paragraph 6A. Just read that over to

23 yourself. And would you tell me, does that correctly

24 summarize the subject matter of the testimony you'll be

25 giving in this case?

1 A I think so.

2 Q If you would look at Paragraph 6B on Pages

3 4-5, does that correctly summarize the substance of the

4 facts and opinions that will comprise your testimony at

5 trial?

6 A I recognize these are intended to be summary

7 statements. There are a number of inadequacies in the

8 SWIM Plan as a water resources planning document that are

9 not listed in Number 2 here. And I'm prepared to tell

10 you about those. I don't know what degree of detail this

11 listing was supposed to go into.

12 Q At that same summary level of detail that is

13 reflected in that paragraph that you are referring to,

14 would you tell me what these other inadequacies in the

15 SWIM Plan that you'll be testifying to will be.

16 A The document Ms. Raeapple gave you that she

17 said was a summary of opinions which runs quite a few

18 pages sets out I think again in summary form the list.

19 It's a pretty long list.

20 MR. SAXE: Ms. Court Reporter, would you

21 please mark this as Exhibit 1.

22 (Exhibit 1 marked for identification.)

23 BY MR. SAXE:

24 Q Dr. Luke, I don't have multiple copies of

25 this document to refer to. I'll show it to counsel

1 first. And then if she would give it to you.

2 Is that the document you are referring to?

3 A Yes, it is. And let me say that is typed by

4 me. And were I trying to be employed as a professional

5 typist, I would not be worth very much. And I didn't

6 even run it through the spell-checker. So these are just

7 internal notes. They are not meant as a work product.

8 Q I'm sorry. Could you explain what you mean

9 when you say "these are just internal notes, it's not

10 meant as a work product."

11 A It was not meant as deliverable to my client

12 or to you. It is just an outline that I have compiled

13 for my own purposes. But I felt it might expedite things

14 in this deposition if I made it available to you.

15 Q Okay. Absent typographical or grammatical

16 errors, does this document reflect your opinions for

17 trial?

18 A Yes. On the matters addressed.

19 MR. SAXE: For the record, this is one of

20 the documents that was produced to us this

21 morning.

22 BY MR. SAXE:

23 Q Dr. Luke, this is not page numbered, but it

24 looks to be maybe 15 or more pages along. It's obviously

25 not -- or I would ask you, would you view this document

1 as having the same level of summary detail as the

2 paragraph entry in the witnesses designation that you

3 intend to supplement with this document?

4 A Well, it probably goes into more detail.

5 But it does go -- I mean it is at the same level in many

6 instances as saying that the SWIM Plan does not determine

7 the plan's probable costs and benefits. There is a

8 listing of a lot of other things that a sound plan should

9 do that the SWIM Plan doesn't do.

10 Q Okay. Why don't we take a few minutes with

11 that. And then if you would, go through this document

12 with me and in that same level of summary description

13 give me your oral testimony to supplement the witnesses

14 designation with what in this document belongs there in

15 your view.

16 A Okay. It occurs to me it might help both of

17 us if we just wrote page numbers on the copy, the record

18 copy.

19 Q Why don't you go ahead and do that on the

20 marked exhibit copy.

21 MR. SAXE: Carolyn, is this a copy that I

22 can hang on to?

23 MS. RAEPPLE: Yes. You may have that.

24 MR. SAXE: Thank you.

25 A I came up with 16 pages.

1 BY MR. SAXE:

2 Q Okay. If you would just start from the top

3 of the document. As you read through it, when you feel

4 ready to give me an oral statement of facts and opinions

5 that will comprise your testimony belonging in this

6 witnesses designation, you can just read those into the

7 record.

8 MS. RAEPPLE: Object to the form of the

9 question. I'm not going to agree that the

10 witnesses designation isn't a sufficient summary

11 of the opinions that he is going to give in this

12 proceeding.

13 MR. SAXE: I'm really directing the question

14 mainly at Dr. Luke's view of the adequacy of the

15 summary to describe the testimony he expects to be

16 giving.

17 BY MR. SAXE:

18 Q So with that caveat, I would appreciate it

19 if you would try to accommodate this request.

20 A All right. In terms of a water resources

21 planning process, which my reading of the SWIM

22 legislation says the SWIM Plan is supposed to be, the

23 guidance that's offered in what I guess is now DEP rules

24 is very summary. And so the question is what does a

25 reasonable and rational plan for a major water resources

1 include?

2 And as a yardstick after looking through a

3 fair amount of literature, I determined that the federal

4 document entitled "Principles & Guidelines for Water and

5 Related Land Resources Implementation Studies," which is

6 a 1983 publication of the Water Resources Council, is a

7 good and practical yardstick to hold up to a water

8 resources plan and determine whether it has been done in

9 a reasonable and rational manner.

10 Q Excuse me. What was the title of that

11 document again?

12 A Top of Page 2.

13 Q Okay. Thank you. That would be the

14 principles and guidelines?

15 A That's correct. For instance, this is a

16 document whose guidance is legally binding on the Corps

17 of Engineers Bureau of Reclamation and certain other

18 federal agencies. And in fact, the corps is planning --

19 the current planning rules specifically reference this as

20 what their rules are intended to implement. So it is not

21 an academic blue-sky kind of thing.

22 It is the underlying principles for federal

23 water resources plan. And there is nothing contrary that

24 I can find in Florida law. And what you'll see here, the

25 bracketed numbers refer to sections in principles and

1 guidelines.

2 The first part of this little memo is just

3 my outlining and abstracting from the principles and

4 guidelines. And that runs on through the middle of Page

5 8.

6 And then what I've done is to go back

7 through and look at the SWIM Plan to see where it appears

8 to fall short of those principles and guidelines. And

9 from Page 9 through Page 14 is a listing of the

10 inadequacies of the SWIM Plan to do those steps or make

11 those considerations which I think are necessary for a

12 reasonable and rational water resources plan.

13 And those are really very summary

14 statements. I mean in each one of those you could have a

15 discussion of.

16 Q So would it be fair to say that Pages 9

17 through 16 or so -- I'm sorry. Did you say 9 through 14?

18 A I said 8 through 14. The last two pages are

19 something else.

20 Q So that would be your prescription or

21 recommendation for how to cure what you see as

22 inadequacies in the SWIM Plan?

23 A No, sir. It is a listing of some of the

24 things -- the kind of major points that I see as

25 inadequacies. And I'm not telling you that I've written

1 up the cures in any or all cases.

2 Q You refer to the DEP rules governing what

3 you view as the requirements for the SWIM Plan. Do those

4 rules refer to these principles and guidelines?

5 A They do not.

6 Q It's your testimony that these principles

7 and guidelines best describe what's required under the

8 DEP rules?

9 A I believe they describe what is required

10 under the statute, which is a determination of the public

11 interest. And the reason that the principles and

12 guidelines were distilled from 50 years of federal water

13 planning was to provide for planning that would be in the

14 public interest through a balanced consideration of

15 economic, environmental and other considerations in the

16 planning process and to provide for consistent planning

17 so that you would be able to make some reasonable

18 comparisons between competing proposals.

19 Q You referred to a statute requiring a

20 determination of public interest. What statute is that?

21 A I'm looking at the SWIM Statute 1989. And

22 let's see if I can give you a correct citation here.

23 It's part of Chapter 373.453.

24 Q Okay.

25 A And it says, "The plan shall also include

1 recommendations and schedules for bringing all sources

2 into compliance with state standards when not contrary to

3 the public interest."

4 Q Are you reading that language now, Dr. Luke?

5 A Yes.

6 Q Okay. What section is that of 453?

7 A It looks like it is part of (2)(d).

8 Q Okay. So then if I understand your

9 testimony, the federal principles and guidelines that you

10 referred to in Exhibit 1 in your opinion are what

11 describe in more detail the requirements to meet this

12 public interest provision of Section 373 of the Florida

13 Statutes?

14 A I think that's right.

15 Q Will you be presenting testimony on the

16 meaning of Section 373 and what it requires of the SWIM

17 Plan at trial?

18 A I think from the standpoint of a public

19 policy analysis of trying to determine what's inserted to

20 effectuate the public policies of the act, yes.

21 Q Dr. Luke, in the witnesses designation on

22 Page 4, Paragraph 2, there is a reference to the SWIM

23 Plan "not complying with federally accepted standards and

24 principles for water resources products or state law

25 requirements," et cetera?

1 A Right.

2 Q Is it your opinion that the principles and

3 guidelines for water and related land use sources

4 implementation studies describes what is required for

5 compliance with both the federally accepted standards and

6 the state law requirements?

7 A I think it is a good yardstick. There are

8 some other specific procedural type requirements in the

9 state law that are not per se taken from principles and

10 standards. But I think if you are asking the question

11 generally what does a reasonable, rational water

12 resources plan contain, that principles and standards is

13 a very good guideline.

14 Q Besides your reading of the statute referred

15 to earlier, Section 373 of the Florida Statutes, can you

16 describe for me the basis for your opinion that the

17 federal principles and guidelines reflect a "yardstick"

18 -- I believe was the term you used -- for complying with

19 the state law requirements and the federal standards?

20 A Well, I go back to the notion of the

21 requirement that the plan not be contrary to the public

22 interest. The public interest I think requires a

23 balanced consideration of economic, environmental and

24 social impacts, costs and benefits of a proposed action

25 by the state.

1 I think it also requires a balanced

2 consideration of alternative means of accomplishing

3 whatever the state's objectives may be where there are

4 alternative technologies or management programs that

5 colorably would accomplish those objectives. And I think

6 that they have to deal with uncertainties where

7 uncertainties exist in the process in order to do

8 planning and public interest.

9 Q What I would like is if you can describe for

10 me the basis for those opinions, any scholarly text that

11 refer to those principles and provide the basis that you

12 might have relied on, any other studies that you've seen

13 done in the state of Florida that you believe comply with

14 those requirements, anything else that you may have

15 relied upon in formulating the opinion that you've just

16 given to me?

17 A Sure. The 1986 corps report does. And I

18 think it is a good example of what water resources

19 planning for managing the very basin that we are talking

20 about looks like in terms of a consideration of the whole

21 system and a consideration of alternative technologies

22 that could be used in order to deal with some problems

23 and opportunities.

24 There is a body of material, some of which I

25 know we have cited to you from the Water Resources

1 Research Institute that is maintained by the Corps of

2 Engineers which really is the history of water resources

3 planning in the United States.

4 And the use of cost benefit analysis

5 consideration of alternatives, the idea of formal cost

6 benefit analysis actually originates formally in the new

7 deal with the various projects in the Roosevelt

8 Administration and comes forward and kind of grows and is

9 refined, the notion of using a single federally defined

10 discount rate to provide comparable analysis of competing

11 projects.

12 Then in the '60s and the '70s, the insertion

13 into that of a balanced consideration of environmental

14 alternatives and the adaptation of the principles and

15 guidelines to encompass the requirements of the National

16 Environmental Policy Act.

17 There are a number of articles in the water

18 resources journals that really detail the history. And

19 then the latest formally adopted statement that kind of

20 synthesizes the last 50 years of development of the

21 federal water resources planning policy is the 1983

22 principles and guidelines.

23 Q Are you familiar with any South Florida

24 Water Management District water resources projects that

25 would comply with your view of the state law requirements

1 as you've testified to them here?

2 A The only two that I have reviewed in any

3 detail are their 1990 draft SWIM Plan and then the 1992

4 adopted SWIM Plan. And neither one of those would

5 comply. I have not tried to go through and look at all

6 of their various plans.

7 Q So would it be fair to say then you are not

8 aware of any water management district prepared report,

9 studies or analyses that comply with the federally

10 accepted standards and the state law requirements?

11 A That would be correct.

12 Q Are you aware of any Florida state agency or

13 regional agency or other local agency prepared reports or

14 analyses that do comply with these standards?

15 MS. RAEPPLE: Objection to form.

16 MR. SAXE: Compound?

17 MS. RAEPPLE: No foundation.

18 MR. SAXE: All right.

19 BY MR. SAXE:

20 Q Let me rephrase the question, Dr. Luke. Are

21 you familiar with any analyses or reports prepared for

22 water resources projects by any Florida state agency that

23 do comply with the requirements in your opinion?

24 A I have made no investigation to see, so I've

25 not reviewed any Florida state agency reports to see if

1 they comply or not other than the two that I've

2 mentioned.

3 Q And that would include at any level of

4 Florida government, regional level, local level?

5 A That's correct.

6 Q Are you familiar with any reports or

7 analyses prepared by any state agency, local or regional

8 from any other state that comply in your view with these

9 requirements?

10 A Yes.

11 Q Could you identify them for me, please?

12 A Yes. The planning studies that I worked on

13 with the Denver Water Department for the Twin Forks

14 Reservoir, which were studies prepared by in effect the

15 city of Denver, I think were done in conformance with the

16 principles and guidelines.

17 Q Have you produced copies of those materials

18 to us?

19 A No. I don't think they would be responsive

20 to any discovery request you've made.

21 Q Okay. Are there any others that you are

22 familiar with?

23 A Not that I could call off to you by name.

24 Q Outside the state level now instead of at

25 the federal level, you identified the 1986 corps study.

1 That was one that in your view complies with the

2 requirements?

3 A Yes.

4 Q Are there any others that you are familiar

5 with?

6 A I have reviewed a recent study done by the

7 corps for the Johnson Creek project in Arlington, Texas

8 which is primarily a flood control project. And it also

9 complies -- it would be my assumption that all Corps of

10 Engineers Bureau of Reclamation, the consult conservation

11 service implementation studies would comply with it.

12 Q You mentioned a number of Water Resource

13 Research Institute publications or articles I believe?

14 A Yes.

15 Q Are there any in particular that provide a

16 basis for your opinion that the SWIM Plan should include

17 analyses consistent with the the federal principles and

18 guidelines that you've identified?

19 A The articles that I've looked at, which

20 again I believe we have listed for you, go through the

21 history of why these were developed. And they were

22 developed really as a result of pressures from various

23 sides, economic, environmental, state, local, federal on

24 projects and congressional pressures.

25 And I think that they are really a resultant

1 that defines what the federal government considers to be

2 planning in the public interest for water resources

3 projects.

4 Q Okay. Are there any other materials,

5 whether they would be publications or studies or

6 articles, that you intend to or expect to adduce as

7 support for your opinion that the federal principles and

8 guidelines describe the reasonable requirements for the

9 SWIM Plan?

10 A Once again, I'm not saying that it

11 encompasses all the requirements of the SWIM Plan. I am

12 saying that it is a good practical definition of what

13 water resources planning in the public interest must

14 include.

15 Q Will you rely on any other materials to

16 support that opinion at trial?

17 A The journals and articles that we've already

18 identified to you I think probably would be sufficient.

19 If there are contrary opinions voiced in later

20 depositions, I certainly may research whatever they cite

21 and do additional research in that regard.

22 Q But as of this time, the answer would be --

23 A Nothing that we haven't already identified

24 to you.

25 Q Okay. Very good. Thank you. Just to

1 clarify, Dr. Luke, I had intended -- I'm not sure whether

2 I clearly did or if you clearly understood my earlier

3 question some time ago toward the start of the deposition

4 about whether the entry 6B adequately summarized the

5 substance of your facts and opinions. And your response

6 generally focussed on Paragraph 2 which we have just

7 discussed at some length on the basis of what's been

8 marked as Exhibit 1.

9 Other than these additional opinions

10 reflected in this document, does this witnesses

11 designation correctly summarize the substance of facts

12 and opinions that you'll be testifying to at trial?

13 A Yes. I have no problem with it.

14 Q Okay. If you would look at Paragraph 6C on

15 Page 5, does that entry accurately summarize the grounds

16 for your opinions?

17 A I guess there would be the usual addition of

18 reliance upon my general education and experience which

19 is not enumerated there. So I would throw that in as

20 well. But other than that addition, yes, that's right.

21 Q Okay. Very good.

22 A I'm sorry. Let me just add -- I mean I'm

23 also relying upon analyses done by various staff members,

24 certain analyses done by Dr. Leistritz and in some cases

25 by other witnesses that have been named that I guess

1 could all come under unpublished information.

2 But I certainly in some cases am relying

3 upon other experts in reaching my opinions.

4 Q Has all of the analyses to your knowledge by

5 staff members, Leistritz or other witnesses upon which

6 you would be relying been put in printed form?

7 A You mean have they reduced it to writing?

8 Q Yes.

9 A Not in all cases.

10 Q Has all the analyses that has been reduced

11 to writing by these staff members, Dr. Leistritz and any

12 other witnesses that you would be relying on, has that

13 been produced with your documents?

14 A Yes.

15 Q Can you describe for me what analysis you'll

16 be relying on that has not been reduced to writing?

17 A I can give you some examples of that. I

18 don't know that I'm going to recall every datum that

19 might fit under that question. But I've spoken with Dr.

20 Shannon on several occasions with regard to the different

21 filtration technologies that are available and some of

22 their characteristics to get a better understanding of

23 those.

24 And I've spoken indirectly with Dr.

25 Polopolos about his current opinion regarding future

1 prices on sugar cane. I mean those would be the two

2 examples that most readily come to mind.

3 Q I understand you may not be able to exhaust

4 the conversations or non-written communications that you

5 had with witnesses or staff members that might have

6 formed some basis for your opinions, but if you could try

7 as best as possible at least to identify all of the

8 significant ones I would appreciate it.

9 A Sure. Certainly Ed Warren and Eric

10 Schubert, Larry Leistritz. I've spoken on a couple of

11 occasions with Andy Bernstein. And really he's been a

12 go-between with Leo because I was traveling and he got in

13 touch with him for me. Those would be I think the

14 significant ones.

15 Well, Dr. Shannon I mentioned. And then the

16 staff of the cooperative, Jeff Ward would be the main

17 person.

18 Q What were the topics if you can recall that

19 you had communications with Mr. Warren concerning that?

20 A Ed is an economist with my firm that has

21 been working with me on the review of documents and on

22 the development of the impact model comparison

23 alternatives. I mean we've had an ongoing dialogue about

24 pretty much all aspects of the project.

25 Q Besides the development of the impact model,

1 are there any particular aspects that your conversations

2 have focussed on?

3 A Well, the planning process, we have both

4 reviewed several of the documents relating to principles

5 and guidelines and to accepted practices in water

6 resources planning.

7 Q Any others that you focussed on with Mr.

8 Warren?

9 A We discussed the analysis of the financing

10 of the SWIM Plan.

11 Q Any others?

12 A Not that I can think of.

13 Q How about Mr. Schubert, again topics of

14 discussions or other non-written communications that are

15 part of the grounds for your opinions?

16 A Some of these there are documents on,

17 particularly with regard to Eric's, that we produced to

18 you. But we discussed the changes between the earlier

19 Hazen and Sawyer reports and the actual contract

20 completion report on the 20-year study. We have

21 discussed various model features that needed to be

22 incorporated in our model. Those would be the main

23 topics.

24 Q Can you specify which features of the model

25 have been the focus of those discussions?

1 A Well, again not to say that I can list them

2 all, but important ones have been how we were

3 incorporating financing, the criteria under which land

4 leaving production, how we were handling the subsidence

5 featuring the model, some general formatting questions

6 just in terms of what the financial output tables should

7 look like.

8 Q Any others that come to mind?

9 A I think those are the main ones.

10 Q Okay. Your conversations or other

11 non-written communications with Dr. Leistritz?

12 A We have discussed water planning principles

13 and guidelines. The question of agricultural land

14 leaving production, question of the population migration

15 response in a declining area, some discussion regarding

16 critical minimum market sizes for various types of

17 establishments. Those would be the main ones.

18 Q Minimum market sizes with respect to various

19 types of establishments?

20 A Right.

21 Q What establishments would that be?

22 A Retail and consumer service establishments.

23 He has done some studies -- and I believe we produced

24 those to you -- concerning the decline in the retail and

25 service sector in the upper Great Plains communities, the

1 population and purchasing power has dropped.

2 Q Okay. Mr. Bernstein was also someone you

3 mentioned in your list of people with whom you have had

4 non-written communications?

5 A Right.

6 Q Could you tell me something about the topics

7 that you focussed in those non-written communications?

8 A Yes. We have discussed the subsidence

9 issues. We have discussed the financing, and most

10 specifically with him the cost for bond financing. And

11 then we've also discussed with him Dr. Polopolos'

12 opinions on future price trends for sugar cane.

13 Q Any others?

14 A None that I recall.

15 Q You've been retained by the cooperative to

16 provide expert testimony in this case; is that correct?

17 A It's been so long. I think I'm retained by

18 the cooperative as opposed to the law firm. But it's one

19 of those two.

20 Q Have you, RPC or any of your contractors or

21 subcontractors or RPC's contractors or subcontractors

22 been retained by the cooperative for any other purpose in

23 this case besides preparing or presenting expert

24 testimony?

25 A You've kind of thrown me there. "In this

1 case besides expert testimony," could you give me an

2 example?

3 Q Sure. Other consultation for services

4 besides those pertaining to the preparation and

5 presentation of your expert testimony at trial.

6 A Neither I personally nor RPC have. The only

7 subcontractor that I have in this case is Dr. Leistritz.

8 And I'm not aware that he has been retained in any other

9 capacity.

10 Q I'm going to ask you some questions about

11 economic impact analyses, economic impact studies,

12 economic impact reports, socioeconomic impact studies,

13 analyses or reports. The following set of questions I

14 want you to understand that when I ask about such reports

15 I mean any and all such analyses or studies that in your

16 view either fall into economic impact or socioeconomic

17 impact analysis. I don't want with each question to have

18 to iterate through.

19 If you feel that you can't truthfully answer

20 a question given that shorthand, bring it to my

21 attention. But otherwise understand that when I ask

22 about reports, that's what I'm referring to for the next

23 several questions.

24 You've indicated that you have reviewed

25 several such impact reports prepared by Hazen and Sawyer.

1 You mentioned differences between the contract completion

2 report by Hazen & Sawyer and an earlier draft report.

3 Were those economic impact reports as you would

4 understand that term?

5 A Yes. They would fall in that category.

6 Q Okay. Would you just for the record tell me

7 more specifically which report versions Hazen and Sawyer

8 produced that you were referring to?

9 A There is an actual memorandum that Dr.

10 Shubert prepared comparing the contract completion

11 report.

12 Q Dr. Luke, if it would be helpful, you can

13 feel free to spread those copies out or stack them

14 however you want to.

15 A That's okay.

16 MS. RAEPPLE: Mr. Saxe, may I suggest also

17 that you add to the stack of documents that Dr.

18 Luke is referring to the documents that we

19 produced in the last day or two, because the memo

20 he is referring to may be in that set of

21 documents.

22 MR. SAXE: Counsel, I have one copy only of

23 all those documents. We'll need to keep them

24 separated because they haven't been control

25 numbered or copied for our files yet.

1 Also, if we are going to introduce them as

2 exhibits, we'll have the problem of not having

3 copies of them. But yes I will.

4 THE WITNESS: I found it.

5 MS. RAEPPLE: But just to the extent that

6 you are asking him to review documents, I want to

7 make sure that he's got a comprehensive set of

8 them.

9 A Okay. I believe your specific question was

10 what were we comparing. And the two reports that we were

11 comparing were the May 1993 draft report and the August

12 1993 contract completion report.

13 BY MR. SAXE:

14 Q Is it correct that these are Hazen and

15 Sawyer economic impact reports, loosely described, that

16 you've reviewed or have been reviewed by your staff or

17 subcontractors in preparing your testimony and opinions

18 in this case?

19 A Yes. That's right.

20 Q Are there any other Hazen and Sawyer reports

21 that fall into that category?

22 A Well, as you know, there was an earlier

23 10-year report that I believe has a late '92 or early '93

24 on it.

25 Q Yes. That was the subject of the extended

1 questioning at your previous deposition.

2 A Exactly. I mean we've looked I think at all

3 of the Hazen and Sawyer reports at one time or another.

4 And I wouldn't want to tell you that we've ignored any of

5 them to the extent we thought they were helpful or

6 relevant.

7 Q Would it be fair to say that any Hazen and

8 Sawyer reports you were aware of you've reviewed in

9 preparing the testimony?

10 A Yes. Or I've had my staff review.

11 Q Okay. Any other reports, economic impact

12 studies, analyses or reports or socioeconomic impact

13 studies, analyses or reports that you have or your staff

14 has or subcontractors have reviewed in preparing your

15 testimony exclusive of ones that have been prepared by

16 you, your staff or subcontractors?

17 A Well, a lot of the documents authored by

18 Leistritz that have been listed or produced to you I

19 think fall in the category of socioeconomic impact

20 reports.

21 There are other planning studies, for

22 instance the lower East Coast water supply working

23 document, the 1948 and the 1986 corps studies of the

24 basin which have elements of economic impact studies.

25 Q What was the date of the first of those two

1 reports?

2 A The '48.

3 Q 1948?

4 A Yes.

5 Q And --

6 A And the '68. There are economic studies,

7 the Mulkey -- and I can't think of the second author's

8 name -- but the impact studies and impact for sugar cane

9 on the economy. There are a number of IFAS -- I-F-A-S --

10 documents that would qualify as economic impact studies.

11 Q Any in particular that you have reviewed

12 specifically pertaining to this case?

13 A Well, any IFAS study I've looked at has

14 pretty well been in conjunction with this case. I think

15 there is one on rice, there is one on sugar cane, there

16 is one on vegetables, there is one on sod. There is the

17 usual output of an applied agriculture economics program

18 on this.

19 Q Any other economic impact reports that have

20 been reviewed for the preparation of your testimony?

21 A There are some reports that were reviewed

22 back when we were reviewing the economic benefits study.

23 And gosh this has been now almost two years ago, so I'm

24 sure not going to be able to name all of those.

25 But there were certainly a number of reports

1 that were cited in that study. I believe there was some

2 sort of a study that was done by an environmental group

3 from Florida authored by a guy named Diamond. And I may

4 have looked at some other general mythological things on

5 measuring wildlife, fishery, wilderness type values at

6 that point.

7 Q The benefits report that you referred to,

8 would that be the contract completion report on the

9 economic benefit evaluation of everybody's restoration

10 and preservation by Hazen and Sawyer dated October 1992?

11 A Yes.

12 Q Are there any other economic impact reports

13 that have been reviewed in preparing your testimony that

14 you are aware of?

15 A None that I recall at this time.

16 Q Okay. Are there any other analyses, maybe

17 parts of economic impact or socioeconomic impact reports

18 that have been reviewed by you or subcontractors or RPC

19 staff in the preparation of your testimony at trial?

20 A Right. I'm not able to really respond with

21 regard to anyone but myself because obviously I don't

22 monitor their reading habits that closely. I would say

23 that in the Davis and Ogden book there is a good deal of

24 relevant information that goes into an understanding of

25 what is cost, what is a benefit, what is the problem or

1 opportunity that the planning is directed at.

2 I've also had the opportunity to look at

3 some of the -- I believe it's Burns and McConnell -- work

4 on filtration alternatives and of course on the BMPs and

5 that kind of thing. I don't know where you draw the line

6 between economic impact and economic analysis, but those

7 are certainly components that are helpful in getting to a

8 cost benefit or an economic impact type study.

9 Q Burns and McDonald?

10 A I thought it was McConnell. It's the

11 district's consultant that's done a lot of their

12 engineering work.

13 Q On BMPs?

14 A I'm thinking of filtration. Maybe it's

15 Brown and somebody on BMPs.

16 Q Okay. Any others that come to mind?

17 A I have very lightly skimmed -- I wouldn't

18 want to tell you I have read them or scanned them even --

19 but some of the feasibility investigations that have been

20 done with water supply alternatives for the lower East

21 Coast water supply plan.

22 Q Any others?

23 A Not that come to mind.

24 Q The Burns Engineering analysis on filtration

25 technology and the Brown analysis on BMPs, have copies of

1 those been produced with your documents?

2 A The BMP analysis if it was it was produced a

3 long time ago, and it was probably just listed. It's

4 cited in the Hazen and Sawyer report as their source on

5 the BMP cost.

6 The one on filtration technology we produced

7 to you I think an excerpt from that. It's a technical

8 memorandum. I believe Ms. Raepple gave you that this

9 morning.

10 Q Okay.

11 A But again, it's a district document.

12 Q Now I would like to ask you about reports,

13 economic impact, socioeconomic impact, community impact,

14 economic impact reports broadly so-called that have been

15 prepared by you or RPC staff or subcontractors in the

16 preparation of your opinions and testimony for trial.

17 A Okay.

18 Q Would you identify any such reports.

19 A Let me just be sure I understand. You are

20 limiting your questions to ones we prepared for this

21 case, for this matter?

22 Q That is correct.

23 A Okay. In terms of a written narrative

24 report, we have not understood that we needed to do such

25 a narrative report. And so there is no formal work

1 product that exists in that regard.

2 Q When you say "narrative reports," do you

3 mean a report like the Hazen and Sawyer contract

4 completion report?

5 A Right.

6 Q And what about that lends itself to the

7 narrative description that you would use?

8 A It contains in addition to any, you know,

9 graphs, tables, figures, it contains narrative text.

10 Q Are there any reports involving graphs,

11 tables or figures but not narrative text that have been

12 prepared by you, RPC, subcontractors in the preparation

13 of your opinions and testimony for trial?

14 A No. Certainly not any kind of formal

15 deliverable kind of report. I mean any of those memos I

16 guess could be referred to as reports. But nothing in

17 the nature of work product deliverable.

18 Q Are there any analyses other than reports as

19 you view them that have been prepared by you, RPC or

20 subcontractors in the formulation of your opinions and

21 testimony that quantify economic impact or socioeconomic

22 impact?

23 A Yes.

24 Q Okay. Could you identify those for me?

25 A Yes. The disk that we provided to you

1 contains a set of spreadsheet models that embody data and

2 relationships and some data files relating to assumptions

3 that go into the analysis of economic, some demographic,

4 some fiscal impacts that we have prepared.

5 Also the materials that I produced to you

6 this morning, a set of tables with rows and columns of

7 numbers are outputs of that model that allow me to

8 compare some various phosphorus removal alternatives to a

9 no-action alternative.

10 Let me as a caveat say that that assumes the

11 BMPs have already been implemented as part of the base

12 line for no-action alternative that summarize the

13 findings from the model analysis.

14 Q Okay. If we could go through this with

15 perhaps just a little bit more specificity, because I

16 have received diskettes in two separate productions.

17 There was a set of diskettes that were produced last

18 month.

19 A Right.

20 Q I believe there was a diskette that was

21 produced yesterday. And you also referred I think just

22 now to hard copy or written printout material that was

23 produced today.

24 A Right.

25 Q So if you could help me sort through this,

1 starting with the stuff produced in February telling me

2 what kind of an analysis that is and working up and let

3 me -- I believe this is a copy of the diskettes from

4 February.

5 A Right. I can tell you what those are. I

6 don't need to look at them to do that.

7 Q Okay.

8 A You had asked that we produce all data files

9 and computer files I believe as part of your document

10 request. And except for ones that were, you know, word

11 perfect files and memos that we printed out, that's a

12 dump of all of the data files and such that we had on our

13 computer related to this project other than some

14 published ones like the '80 census tape or the appraisal

15 district tape.

16 Q And again, what kinds of economic impact

17 analyses are contained in those files?

18 A Well, I mean they I believe would contain

19 tables that we have previously produced to you that were

20 sort of base line conditions. There are probably some of

21 the data files that ultimately were incorporated into to

22 the spreadsheet model we provided to you yesterday.

23 There may be some data files in there that

24 we accumulated but then were not able to incorporate. I

25 mean I don't have a comprehensive memory of every one of

1 those data files.

2 Q So the disk that was produced yesterday is

3 the spreadsheet model; is that correct?

4 A Yes. And I want to be clear. That includes

5 several spreadsheet notebooks and macros to operate

6 those. And I believe we produced to you a written set of

7 instructions for how to use it.

8 Q I believe I've seen that. Thank you.

9 The February of '94 diskettes don't include

10 a spreadsheet model in the same sense that the March

11 diskette does?

12 A No. There may be an earlier version but

13 certainly not our final version. And there may be pieces

14 that ultimately were incorporated into that but that were

15 not linked or made part of the notebooks at that time.

16 MR. SAXE: Can we take a three-minute break?

17 MS. RAEPPLE: Sure.

18 (Brief recess.)

19 BY MR. SAXE:

20 Q Dr. Luke, again referring to the designation

21 of expert and fact witnesses filed by the co-op, it

22 indicates under the subsidence of your facts and opinions

23 that "implementation of the SWIM Plan as currently

24 drafted would have significant socioeconomic impacts on

25 the region." And then it goes on to elaborate on that.

1 A Right.

2 Q You've reviewed the Hazen and Sawyer

3 contract completion report for the 20-year evaluation of

4 economic impacts dated August of 1993?

5 A Yes.

6 MR. SAXE: I had asked if you could bring a

7 copy of that with you for Dr. Luke to refer to if

8 he needed to as we went through this material.

9 MS. RAEPPLE: (Tendering document.)

10 BY MR. SAZE:

11 Q I would like to go through some questioning

12 about the analyses and conclusions of Hazen and Sawyer in

13 this report and how it compares with any analyses and

14 conclusions that have been formulated in the preparation

15 of your opinions and testimony for trial.

16 So you will probably want to refer to this

17 document as we go through it. And I think we will mark a

18 copy of it as an exhibit to this deposition.

19 A Fine. And, Mr. Saxe, just while you are

20 marking the materials that we produced to you this

21 morning are the kind of quantitative summaries that I

22 brought with me of the analysis that I've done. And so

23 in making comparisons, you may want to mark that just to

24 make life easier.

25 Q Okay. We'll do that.

1 MR. SAXE: Do you have that?

2 MS. RAEPPLE: Yes. I'm trying to find the

3 original copy of that.

4 MR. SAXE: Will this suffice as the copy you

5 produced?

6 MS. RAEPPLE: That's fine.

7 MR. SAXE: Okay. Ms. Court Reporter, could

8 you please mark this document as Exhibit 2.

9 (Exhibit 2 marked for identification.)

10 BY MR. SAXE:

11 Q Dr. Luke, if you have a copy that is more

12 complete, we may want to mark that as the exhibit copy

13 and we'll take a photocopy of it for you to take back

14 with you at the end of the deposition.

15 Does that sound all right?

16 A It works for me.

17 Q Dr. Luke, looking at what's been marked as

18 Exhibit Number 2, would you just identify that document

19 for me for the record.

20 A Yes. This is a set of tables that are

21 either inputs to or outputs from the model that I

22 mentioned earlier that relate to various alternatives and

23 some of their impacts.

24 Q Do you have a name for a model?

25 A We call it the EAA impact model.

1 Q And that's a model that you testified to

2 earlier had been included on the diskette that was

3 produced yesterday?

4 A Correct.

5 Q Okay. Would you describe for me basically

6 what that model is.

7 A Yes. There is a more complete description

8 in the memo of instructions that we provided to you.

9 I'll summarize it as follows: It consists of a series of

10 farm level models for various crops that incorporates

11 over a 20-year period from 1994 to 2013, profit and loss

12 for each of those farm types in each of the various soil

13 types. And then I think that follows very closely the

14 structure of the Hazen and Sawyer model.

15 It looks at whether those farms stay in

16 production or drop out of production and has rules for

17 when they would drop out. It also incorporates a SWIM

18 Plan financing model which makes a couple of assumptions.

19 One is that the phosphorus removal works -- whatever

20 those may be -- are bond financed and that the cost of

21 those bonds is paid in the operating cost of the works

22 and is paid for by the acreage in production.

23 In other words, there is a total cost that

24 includes debt service and annual operations that is

25 sitting out there that is going to be assessed against

1 the EAA land in production. And so the assessment per

2 acre may change from year to year as the acreage and

3 production changes.

4 There is then an input/output model that

5 uses the RIMS two multipliers for Hendry County as a

6 surrogate for the EAA, not Palm Beach County now but the

7 EAA. Because what we are trying to do is we are trying

8 to look at employment and other economic impacts within

9 the EAA, not spread over Palm Beach County as a whole.

10 And out of that, we get total changes in

11 sales and earnings and profit and employment. The model

12 looks at that then in terms of the population movements.

13 It also looks at issues of change in assess evaluations

14 and tax collections by the municipalities in the area.

15 And it also looks at a series of per capita cost for

16 services provided by local government in the EAA so that

17 it's able to derive a fiscal balance.

18 The model is set up with input screens so

19 that one can without running the risk of accidentally

20 altering the formulas that are in it change a number of

21 different assumptions. Structurally that's I think a

22 reasonable summary.

23 Q Who prepared this model?

24 A If you mean who programmed the spreadsheet,

25 that was done primarily by Dr. Shubert. If you mean who

1 decided the structure and some of the ranges of

2 assumptions used, that would be me with input from a

3 number of people.

4 Q And those people would be RPC staff,

5 subcontractors that you have identified in your previous

6 answer to the question about non-written communications?

7 A Yes. And you may recall that answer was

8 broader than employees and subcontractors.

9 Q Okay. Would you clarify it. It was

10 employees and subcontractors in the sense that it

11 included --

12 A Well, it included Dr. Shannon and Polopolos,

13 several people.

14 Q Okay. Are there any other people that you

15 would include in the list that have worked on the

16 development of the model that you haven't mentioned in

17 your testimony today?

18 A I think I mentioned Jeff Ward, but let me

19 mention him again. I certainly had discussions with him

20 about assumptions that might be used in the model.

21 Q So those were not written communications

22 that you are referring to right now but discussions?

23 A Right. To the extent there were any written

24 communications that were not in some way -- privilege is

25 not claimed on them, we have produced those.

1 Q Have there been other discussions with Mr.

2 Ward that are not reduced to writing that have

3 constituted some of the grounds for your opinions or

4 testimony?

5 A Certainly he is one of the inputs. I'm not

6 suggesting that he has specified any of the assumptions.

7 But on many of the assumptions, we at least asked if he

8 had any input. And in some cases he did, and in other

9 cases I don't think he had any.

10 Q Could you focus on which particular types of

11 assumptions in the model your conversations with Mr. Ward

12 have addressed or dealt with?

13 A Well, for instance, we were interested in

14 how fungible the cane was between mills. In other words,

15 are they doing a cost minimization operation with regard

16 to transport costs or if I own land or if a grower owns

17 lands would he truck his cane past a mill to another mill

18 because that's where the contract was.

19 And he said that it is pretty much tied to

20 -- that given acreage is tied to specific mills, that

21 they don't do a lot of swapping of cane under normal

22 circumstances so that you would not look for that kind of

23 optimization.

24 We also I think asked about some criteria

25 for his view if he had any about a lingering out of

1 production economically or mills consolidating or that

2 kind of thing. And I don't believe we retained any

3 information from him on that.

4 One of the conversations was with regard to

5 subsidence and did he have any additional studies that we

6 had not seen published or unpublished. And I do not

7 believe he provided us with anything in addition to what

8 we already had.

9 Q Okay. Can you tell me when the work on the

10 programming of this model was done by Dr. Shubert?

11 A It's extended over a period of time. And in

12 terms of data inputs to it, I mean the data inputs kind

13 of as they come in we put them in. I think the majority

14 of the "substantive programming" of it -- to use that

15 term -- probably was completed maybe a couple of weeks

16 ago.

17 Q Was this programming begun before your last

18 deposition in March of last year?

19 A I don't think -- well, let me say yes and

20 no. I mean we had certainly done some spreadsheet work.

21 And some of that spreadsheet work may have found its way

22 into this model.

23 But in terms of when did we start

24 programming the Qattro Pro notebook model, it would be

25 within the last two or three months.

1 Q The earlier spreadsheet work, was that also

2 with Qattro Pro software?

3 A No. It was in Lotus.

4 Q And sometime within the last two months work

5 was commenced and completed in the Qattro Pro instead of

6 Lotus on this particular model?

7 A Right. In some cases we brought work that

8 had been done in Lotus over into Qattro. And in other

9 cases, it was fresh.

10 Q Do you know why a switch was made from Lotus

11 to Qattro Pro?

12 A Yes.

13 Q Can you tell me why?

14 A Yes. Qattro Pro Five for windows is if not

15 the most advanced then right up there in terms of

16 features for this kind of large spreadsheet application.

17 It uses a notebook metaphor and allows you to link easily

18 up to 256 spreadsheets in one notebook and has a number

19 of features that make it in my view better for the kinds

20 of three-dimensional project model that this is.

21 It also has some nice features in terms of

22 graphing and other outputs that reduces the time it takes

23 to create different presentations of the data.

24 And we shifted as a company to Qattro Pro in

25 December of last year. And after having had the training

1 on it myself, I decided that it would be more efficient

2 to go ahead and move any Lotus work over into it for this

3 project.

4 Q Okay. Can you tell me generally for what

5 purpose beside assisting in the preparation of your trial

6 opinions and testimony this model was developed.

7 A It is specific to the EAA and was developed

8 for this project.

9 Q You said that in some respects it tracked

10 closely to Hazen and Sawyer. I'm not sure whether you

11 said model or methods.

12 A I guess those two overlap. I think model

13 would be correct certainly.

14 Q Okay. Can you tell me generally why you did

15 not use the Hazen and Sawyer model.

16 A I don't think I have the disk for the

17 contract completion report because we've not -- I don't

18 know if counsel has -- but since we've not deposed Dr.

19 Johns and you all didn't list her as a witness, I don't

20 think we have those.

21 Some of the things that we are doing in our

22 model are beyond in scope what they were addressing in

23 their model. And in some cases, we are using different

24 criteria and different decision rules within ours than in

25 theirs. But we have not tried to avoid using structures

1 or concepts that they had employed where we thought they

2 were as good as any.

3 Q You said that some criteria were different

4 and also some -- what was the other aspect in which they

5 were different?

6 A Well, the scope is different.

7 Q Besides scope. I'm sorry.

8 MR. SAXE: Let me just ask, Ms. Court

9 Reporter, would you read back the previous answer.

10 (Requested portion read.)

11 BY MR. SAXE:

12 Q Dr. Luke, beyond the difference in scope, is

13 the general purpose of the analysis that can be performed

14 with this model similar to the general purpose for the

15 analysis that can be performed with the Hazen and Sawyer

16 model?

17 A Yeah. General purpose I think is somewhat

18 --

19 Q Would it be fair to say that the general

20 purpose of both models is to quantify economic impacts

21 broadly speaking of the proposed actions by the South

22 Florida Water Management District that are at issue in

23 this proceeding?

24 A One function of ours is economic. We do go

25 beyond that to demographic and some fiscal measures that

1 I think are important and I don't believe were within

2 their scope of effort.

3 Q Besides demographic and fiscal analysis,

4 would it be correct to say demographic impact analysis?

5 A Oh, you could, yeah.

6 Q Besides the demographic impact aspects and

7 the fiscal impact aspects of the EAA impact model, are

8 there any other aspects of impact that are included in

9 the EAA impact model that are not included in the Hazen

10 and Sawyer model?

11 A I would hesitate to tell you that I know

12 there is not some variable that they or we calculated

13 that the other one doesn't. But going back to your

14 general purpose category, they would be similar.

15 Q I have three volumes of documents here that

16 I would like to have marked as an exhibit.

17 (Exhibits 3, 4 and 5 marked for

18 identification.)

19 BY MR. SAXE:

20 Q Dr. Luke, I'm handing you what's been marked

21 as Exhibit Number 3. Would you please identify that

22 document for the record.

23 A This appears to be the contract completion

24 report for 20-year evaluation economic impacts for

25 implementing --

1 Q Implementing the Marjory Stoneman Douglas

2 Act, et cetera?

3 A Et cetera.

4 Q And it's dated --

5 A August 19, '93.

6 Q Very good. And I'm handing you what's been

7 marked as Exhibit Number 4. Would you just identify that

8 for the record, please.

9 A Right. In addition to the contract

10 completion report, there are two volumes of supporting

11 documents consisting of appendices. And you've handed me

12 Part 1 of 2.

13 Q And now Exhibit Number 5.

14 A Is Part 2 of 2.

15 Q Very good. Thank you. Referring to what's

16 been marked as Exhibit Number 3 if you would, turn to the

17 executive summary, Page ES-1.

18 A Okay.

19 Q If you would take a look at what's titled

20 the "Introduction Section" on that page. It's a

21 paragraph followed by three bullet points. I'm going to

22 be referring to that.

23 If you would read the first sentence to

24 yourself please and tell me whether that sentence

25 contains any inaccurate or misleading representations in

1 your opinion?

2 A Yes, it does.

3 Q Okay. Would you tell me what those are,

4 please?

5 A Yes. "I think the principal purpose of the

6 STAs is phosphorus removal but it's hydro-period

7 management."

8 Q And what's the basis for that opinion?

9 A Because if your purpose was phosphorus

10 removal, you wouldn't use the STA. There is superior

11 technology available for that.

12 Q Do you know whether the South Florida Water

13 Management District has identified a primary purpose for

14 the STA?

15 A They have called them phosphorus controlled

16 structures I think because that allows them to charge the

17 farmers for them. If they call them hydro-period

18 management, they can't charge the farmers for them.

19 Q Let me ask the question again. Do you know

20 whether the water management district has identified a

21 primary purpose for the STAs in its view?

22 A They have been required by the settlement

23 agreement to call them phosphorus removal structures.

24 Q So then would it be correct to say that the

25 water management district has identified the primary

1 purpose of the STAs as nutrient removal, phosphorus

2 removal?

3 A Yeah. I don't know if when you say the

4 "management district" if you mean the board. I don't

5 know what they are identified as. They signed the

6 settlement agreement.

7 Q Does the SWIM Plan identify a primary

8 purpose for the STAs? Let me clarify that.

9 I'm not asking you whether you agree that

10 the identified purpose is the appropriate purpose nor am

11 I asking you whether you think that the identified

12 purpose will be served by the technology. I'm just

13 asking you whether the SWIM Plan identifies a primary

14 purpose for the STAs in your view?

15 A It does say on Page Roman III of the SWIM

16 Plan that STAs will be "designed, acquired, constructed

17 and operated to provide nutrient removal." So I would

18 say they have identified it as a phosphorus removal

19 structure.

20 Q Dr. Luke, referring you to the three bullet

21 points at the end of the introduction section on this

22 page, the sentence begins "The specified actions

23 evaluated were," and then it lists three entries.

24 Would you take a minute and just review that

25 text for me.

1 A Right.

2 Q In your opinion, do these specific actions

3 accurately describe the proposed action that was the

4 subject of the Hazen and Sawyer 20-year study?

5 A I think they generally describe what Hazen

6 and Sawyer analyzed. Whether those three points

7 accurately describe the SWIM Plan's proposed action, I

8 would disagree at least with regard to Number 3.

9 Q Could you tell me what that disagreement is?

10 A Sure. One of the deficiencies in the SWIM

11 Plan as a SWIM Plan is that it does not specify funding

12 sources for its proposed projects and therefore there is

13 no funding or financing plan in the SWIM Plan for Hazen

14 and Sawyer to analyze.

15 Q Are these specified actions in this

16 introduction section that we've just referred to the

17 proposed action that was studied in the EAA impact model

18 analysis that was performed for your opinions and

19 testimony?

20 A We have looked at the conversion of the

21 35,000 acres, but we have also looked at other

22 alternatives if phosphorus removal is your purpose. We

23 have really two options in the Model. One is to treat

24 BMPs as part of the base line since those were adopted by

25 rule that is not under any challenge and are being

1 implemented -- have been implemented I guess would be a

2 better word to say it -- already.

3 We have constructed the model to in effect

4 be able to deal with whatever the cost of the works are

5 constructed by the water management district, and we have

6 incorporated into the model the ability to vary the

7 percentage of that that is assessed against the acreage

8 in production.

9 So we would not be looking at a specific

10 dollar assessment. We would be looking at what

11 percentage of whatever the actual annual cost is going to

12 be would have to be borne by the acreage in production.

13 Q When I use the term "you," if you would

14 construe it as meaning you, RPC staff, Dr. Leistritz and

15 others working in the effort to prepare your opinions and

16 testimony.

17 A Okay.

18 Q Have you analyzed the impact of implementing

19 the best management practices?

20 A Yes. We have done some analysis of that.

21 Q When you say you've "included it in the base

22 line," that's not to mean you have not analyzed the

23 impacts, it's just that you have not analyzed them as

24 part of the proposed action but instead part of the

25 existing economic conditions in the EAA?

1 A That's correct. And we have incorporated

2 into the model the ability to include or not include them

3 in the base line to be able to do that. But I have not

4 brought you today anything which shows any outputs of

5 that difference because we are assuming really the BMPs

6 are part of the status quo.

7 Q In your opinion, are the BMPs part of the

8 proposed action identified in the SWIM Plan?

9 A Actually they are not. That's interesting.

10 I'm glad I looked. They are not identified as one of the

11 EAA related projects. And looking under "SWIM Plan

12 Elements," they are not one of the identified elements I

13 don't believe.

14 Q May I take a quick look at that SWIM Plan

15 document?

16 A Yeah. Let me see if I missed it.

17 Q Dr. Luke, referring you to Pages 110 and 111

18 of the planning document volume of the Everglades SWIM

19 Plan dated March 13, 1992, would you take a quick look at

20 Section 4 on that page that says "Regulatory Program."

21 A Right.

22 Q Based on reviewing that, let me ask the

23 question again. Are the best management practices that

24 were the partial subject of the Hazen and Sawyer 20-year

25 impact study part of the proposed action identified in

1 the SWIM Plan in your opinion?

2 A Not really. Because what I'm saying is that

3 they had already promulgated those rules, gotten final

4 adoption which was unchallenged and that those are not

5 hung up in the adoption of this plan so that --

6 I mean we may be getting pretty technical

7 here, but to the extent that that was a requirement of

8 the district that they have a regulatory program, they

9 had already accomplished that requirement prior to the

10 adoption of this plan through adoption of a separate rule

11 that is not procedurally tied up with adoption of this

12 plan, if that makes any sense to you.

13 Q Would it be fair to say then in order to

14 comply with your view of the federal principles and

15 guidelines for water resource projects as they might

16 apply to the SWIM Plan, is it appropriate to analyze the

17 economic impacts of the BMPs?

18 A If we were looking at sort of the broad

19 system water plan for the South Florida Water Management

20 District, certainly their regulatory programs should be a

21 part of that overall system analysis.

22 If we are looking at the SWIM Plan as an

23 administrative law document, then I think it's just a

24 matter of fact that it is separate from that SWIM Plan.

25 Does that make sense?

1 Q Yes. I understand your answer. But

2 nevertheless, you did analyze the economic impacts of the

3 SWIM Plan but you can't include them either in the base

4 line or not in the base line, that was the effect of your

5 prior testimony; is that correct?

6 A Right.

7 Q Did you -- again using that broadly --

8 analyze the impacts of the three different levels of

9 annual per acre assessment identified in the Hazen and

10 Sawyer study?

11 A I'm not going to tell you that at some time

12 Mr. Schubert might not have run those numbers through.

13 But the structure of the model is not to specify and

14 analyze specific dollar per acre assessments. So I'm not

15 prepared to tell you what the impact of those would be in

16 our view.

17 Q Will the model accommodate that use? Will

18 it permit the modeler to plug in specified levels of per

19 acre assessment as opposed to the derived per acre load

20 or burden based on your financing analysis output?

21 A No. I don't think we've built that in as an

22 easy user specified option.

23 Q Would it be accurate then that none of the

24 documents that you've produced, including the one that

25 was produced today that's marked as Exhibit Number 2,

1 would present economic impacts specifically of those

2 three levels of per acre assessment?

3 A You are correct. They would not.

4 Now, in any given year for one of these

5 alternatives, the assessment on the acreage and

6 production might be one of those numbers. But it would

7 be happenstance. It's not a constant number throughout

8 the period.

9 Q Dr. Luke, would you tell me whether a

10 proposed action was the subject of an economic impact

11 analysis that you have prepared -- again you broadly --

12 using the EAA impact model?

13 A I'm sorry. I don't understand what you just

14 asked me.

15 Q Okay. In the analysis that has been done,

16 that you have done using the EAA impact model, has any

17 agency proposed action been analyzed, any particular

18 agency proposed action?

19 A Yes.

20 Q Could you tell me what that is?

21 A We have analyzed the SWIM Plan action of the

22 35,000 acre STAs, and we have analyzed putting those STAs

23 into the EAA. And we have also analyzed putting them

24 into the WCAs.

25 Q So these would be alternative proposed

1 actions, would that be fair to say?

2 A Right. In addition to that, we've analyzed

3 phosphorus removal through direct filtration and

4 phosphorus removal through micro-filtration.

5 Q You've reviewed the SWIM Plan; is that

6 correct, the Everglades SWIM Plan dated March 13, 1992?

7 A Yes, I have.

8 Q Does the SWIM Plan propose alternative

9 placements or locations of STAs?

10 A No. That's one of its problems. It doesn't

11 analyze any alternatives.

12 Q Have you analyzed the placements of STAs

13 specifically proposed in the SWIM Plan?

14 A I have analyzed, yes, that placement.

15 Q Okay. And you've analyzed the economic

16 impact of implementing the best management practices

17 referred to in the SWIM Plan as part of the base line?

18 A I've incorporated that into the farmer's

19 cost, yes. And I've also incorporated that into the

20 subsidence assumption.

21 Q Okay.

22 A If you would turn to Page 1-1, the first

23 introductory page or the first page in the introduction

24 section of the 20-year Hazen and Sawyer contract

25 completion report, Exhibit 3.

1 A Okay.

2 Q The second sentence in the second paragraph

3 that starts "The portion of the EAA" and continues "in

4 Palm Beach and Hendry Counties is the focus of this study

5 because it is the area addressed in the act and

6 settlement agreement."

7 Do you agree with this statement as it

8 describes the Hazen and Sawyer analysis?

9 A As a statement as what they have done?

10 Q Correct.

11 A Yes. That's what they focus on.

12 Q In your opinion, is that appropriate?

13 A I don't really have a problem with that. I

14 do believe we have a disagreement with them over whether

15 one looks at the county-wide economic impacts or whether

16 one focuses on the economic impacts within the EAA. But

17 we are not differing on our definition of the EAA.

18 Q In your view, is the EAA the same thing as

19 the portion of the EAA in Palm Beach and Hendry Counties

20 that are addressed in the act and settlement agreement?

21 A I'm sorry. I don't understand what you are

22 asking me.

23 Q Are they coextensive? Is the EAA

24 coextensive with that portion of the EAA in Palm Beach

25 and Hendry Counties that is the focus of this study

1 because it is the area addressed in the act and

2 settlement agreement?

3 A It's my understanding that -- and I'm not

4 sure I could draw it for you on a map -- that there is a

5 portion of what is historically been referred to as the

6 EAA which does not fall within the regulated area of the

7 plan and settlement agreement.

8 Q Would you turn to Figure 2-1 in Exhibit 3.

9 A Okay.

10 Q Does this depict the regulated portion of

11 the Everglades agricultural area?

12 A I believe it does, yes.

13 Q Okay. The regulated portion that's depicted

14 in green on this figure, is that the appropriate area or

15 region for the analysis of direct economic impacts of the

16 SWIM Plan?

17 A If we are talking about the direct impacts,

18 that's probably okay. If we are talking about the EAA

19 from the standpoint of looking at the indirect and

20 induced impacts, it would not be because one would need

21 to go ahead and certainly pick up --

22 Q In your view, did Hazen and Sawyer attempt

23 to go beyond that regulated portion of the EAA in their

24 assessment of the indirect and induced economic impacts?

25 A Well, yes. But they went all the way to

1 Palm Beach County, which I think is inappropriate because

2 it dilutes the impacts unacceptable.

3 Q Okay. Can you explain the basis for that

4 opinion?

5 A Sure. Palm Beach County -- I'll have to

6 pull out my chart to tell you exactly how many people in

7 Palm Beach County -- but the EAA is maybe 10 percent or

8 less of the population of Palm Beach County. And if you

9 look at the EAA as being really a separate economy from

10 most of what goes on in Palm Beach County, which I think

11 everyone would have to agree that it is in terms of the

12 employment mix and everything else, then I think that we

13 need to look at the EAA as the economic unit that is

14 being impacted by this.

15 I would stipulate that with regard to Palm

16 Beach County as a whole, the economic impacts are not

17 terribly large just because they are not a very big drop

18 in that bucket. But this is a one-industry area in

19 effect. That industry is agriculture. And if you are

20 taking away substantial agriculture, the people that are

21 thrown out of work by that don't really have in my view a

22 lot of obvious job opportunities in the rest of Palm

23 Beach County to be reabsorbed in the economy.

24 So I think we need to look at this as if it

25 were a separate distinct economy rather than just a

1 component of Palm Beach County.

2 Q Is it fair to say then that in assessing

3 indirect and induced economic impacts at the local as

4 opposed to state level, Hazen and Sawyer assessed

5 indirect and induced economic impacts for Palm Beach

6 County?

7 A That's my understanding, yes.

8 Q And would it be correct to say that they

9 achieved the result by using the RIMS two multiplier for

10 Palm Beach County?

11 A That's correct.

12 Q Was the selection of that multiplier the

13 cause for the error that you are focusing on?

14 A If you are going to analyze the economic

15 impacts for the area of Palm Beach County, then the RIMS

16 multiplier for Palm Beach County is the right one to use.

17 If you want to analyze the indirect and

18 induced impacts in the EAA, then I would not use the Palm

19 Beach County multiplier because I think it would

20 exaggerate the impacts, in that Palm Beach County being a

21 larger and more complex economy will have higher

22 multipliers than would the EAA by itself.

23 And that's the reason that we analyzed other

24 counties that we felt as a county would be more similar

25 to the EAA. And Dr. Leistritz selected the multipliers

1 for Hendry County as being a fair approximation of what

2 we would expect to see as the multipliers were we to do a

3 primary IO study for the EAA.

4 Q What do you mean when you say "a primary IO

5 study"?

6 A Well, with unlimited funds or unlimited

7 graduate students, you can go out and actually do

8 interviews with businesses in an area and you can derive

9 actually an input/output model based on primary data.

10 You may use some other data to fill in the gaps, but you

11 can in effect calibrate a local model for something other

12 than a county.

13 Q And you did not do that; is that correct,

14 you broadly speaking, RPC, et cetera?

15 A It is correct. We did not do that.

16 Q Okay. Instead you used one of the RIMS two

17 multipliers for estimating indirect and induced economic

18 impacts for the EAA?

19 A Yes, we did.

20 Q Okay. And the multiplier that you used was

21 --

22 A Hendry County.

23 Q -- the Hendry County RIMS two multiplier?

24 A Correct.

25 Q Do you know which industrial category in

1 RIMS two for Hendry County was used? I understand that

2 there is more than one RIMS two Hendry County

3 multipliers, there are many multipliers?

4 A Sure. We used the whole table in terms of

5 what we used to represent the direct agricultural

6 activity. Is that your question?

7 Q Yes. Thank you.

8 A We would have used in effect the equivalent

9 ones that were used in Palm Beach County. I don't think

10 we had any disagreement with their choice of which row or

11 column on the table they used for that.

12 Q Do you remember which rows and columns those

13 were by any chance?

14 A No.

15 Q Now I'm not using the you in the generic

16 sense but in a personal sense. Did you personally select

17 those rows and columns from the RIMS tables?

18 A No. Leistritz supervised that.

19 Q Okay. Thank you very much.

20 If you would look at the fifth paragraph on

21 Page 1-1 which continues over on to Page 1-2. Read that

22 to yourself for me, please. I just want to focus on the

23 last sentence. But I think you might want to have read

24 the paragraph for context.

25 A All right. I've read it.

1 Q Okay. Would you agree that the Hazen and

2 Sawyer's 20-year study evaluates the costs and their

3 impact on agricultural production and employment in the

4 EAA of the works of the district BMP requirements

5 described in this paragraph?

6 A Not completely. They have not incorporated

7 any assumption related to what the effects of the BMPs

8 would be on subsidence, which they should have done. I

9 mean I know they have attempted to evaluate the magnitude

10 of the costs and their impact.

11 MR. SAXE: Would you read that answer back,

12 please.

13 (Requested portion read.)

14 BY MR. SAXE:

15 Q Dr. Luke, again using you broadly in the

16 analysis that you've done, have you incorporated the

17 assumptions concerning the effect of BMPs on subsidence?

18 A Yes.

19 Q How has that been done?

20 A Based upon Mr. Bert's deposition, we have

21 assumed that the BMPs for the 25 percent phosphorus

22 reduction would have approximately a 30 percent retarding

23 effect on subsidence rates.

24 Q That's the deposition of John Bert in this

25 case I take it?

1 A Yes.

2 Q Could you turn to Page 4-28, please.

3 A Okay.

4 Q The second paragraph in this Section 4.14,

5 the last two sentences in that paragraph, would you read

6 those into the record for me, please.

7 A Uh-huh (affirmative.) "The combination of

8 money spent for BMPs and soil subsidence is assumed to

9 result in the ability of growers to successfully keep

10 water tables at 18 inches to slow the rate of soil

11 subsidence. The 18 inch water tables used in the

12 projections of soil subsidence rates for sugar cane."

13 Q Okay. Now, if you would turn to Page 4-15.

14 A Okay.

15 Q The table at the top of this page is titled

16 "Rate of Soil Subsidence in the Everglades Agricultural

17 Area." It lists two columns of values, one for water

18 table and feet and the other for the rate of subsidence

19 in inches per year.

20 A Right.

21 Q There is a value of rate of subsidence for 1

22 foot 12 inches presumably and a value for 2 feet 24

23 inches presumably. There is none for 18 inches. But on

24 the assumption interpolating between those two values

25 that the rate of subsidence and inches for the 18 inch

1 water table aspect of the BMP is about one inch a year.

2 Is that the same as the 30 percent reduction

3 in the rate of BMPs that you have used in your analysis?

4 A We have used one inch as the historic rate

5 in the EAA, and we have used 70 percent of those rates in

6 our analysis.

7 I am familiar with the text. I'm not

8 willing to agree that the information that we have

9 suggested -- that there may be a discrepancy between the

10 text and the actual numbers in the Hazen and Sawyer work.

11 Q Which text?

12 A The text you asked me to read into the

13 record.

14 Q And which Hazen and Sawyer work, the actual

15 analysis contained in the appendices volumes?

16 A Right.

17 Q Could you focus on that for me, please?

18 A No. I can just tell you that when we looked

19 at it, it does not appear that they had incorporated

20 anything like a 30 percent reduction from historic rates

21 into their spreadsheets.

22 Q I'm sorry. You are saying that they did not

23 incorporate the 30 percent reduction from historic rates?

24 A Right.

25 Q Which RPC did use in its analysis?

1 A Yes. Now, we have constructed our model so

2 that we can use various rates. And one reason we've done

3 that -- and you'll even see some tables here -- is

4 because if one were to go to greater reliance on BMPs for

5 reduction of phosphorus, the 45 percent or I believe

6 there is even a 70 percent specified, without telling you

7 I know what the subsidence reaction to that would be,

8 it's at least possible that we would want to be able to

9 look at an even lower rate of subsidence from adoption of

10 stricter BMPs.

11 Q In your opinion, is the 70 percent or the 30

12 percent reduction from the historic rate of subsidence

13 under the BMP requirements presently in place in the EAA

14 accurate?

15 A I have no way to assess that. Mr. Bert

16 appeared to be qualified to make that estimate. And I've

17 accepted it for purposes of our base line scenario.

18 Further information might cause me to change it, you

19 know, up or down. But that's the best information, best

20 estimate I have right now.

21 Q Do you have any opinion whether greater

22 reductions in the historic rate of subs