State v. Northeast Tampa Special Road & Bridge District , 148 Fla. 14 ( 1941 )

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] On May 24, 1941, the Board of County Commissioners of Hillsborough County, having previously adopted resolution for that purpose, filed petitions in the circuit court to validate refunding bonds for North Tampa Special Road and Bridge District, Special Road and Bridge District No. 5, and Northeast Tampa Special Road and Bridge District and Lake Fern Special Road and Bridge District in Hillsborough County. The statutory notice to citizens and taxpayers was published in each of said Special Tax Districts as required by law. Answer was filed by the State Attorney and taxpayers were permitted to intervene and file answers in each case. The answer of the State Attorney was on motion amended to embrace all objections and questions of law or fact raised in the answers of the intervenors. Evidence was taken on the issues made, the questions were argued, and the circuit court entered a final decree in each case validating the refunding bonds. We are confronted with an appeal from all three decrees but the questions being identical, we treat them together.

The first question presented may be stated as follows: May the Board of County Commissioners of Hillsborough County impose an annual tax on all taxable property in said Special Tax Road and Bridge Districts sufficient to service the refunding bonds being validated, basing such tax on the previous three years tax collection?

The gist of the objection raised in this question is based on that part imposing the tax on the basis of the previous three years tax collection. Sections 2303 to 2308 inclusive, of the Compiled General Laws of 1927, is relied on to support this contention. These sections comprise portions of the general county budgetary law and have no reference to taxes for servicing special tax district bonds. The refunding bonds involved here are proposed to be issued under Chapter 15772, Acts of 1931, which provides a compelte scheme for their issue, sale, and liquidation irrespective of other Acts dealing with similar subjects. Webb v. Hillsborough County, 128 Fla. 471,175 So. 874; State v. City of Clearwater, 125 Fla. 73,169 So. 602.

The second question is whether or not the Board of County Commissioners of Hillsborough County is authorized to issue refunding bonds in the name of the said Special Tax Districts which may be in excess of the amount of principal and interest of the outstanding indebtedness.

We have examined the record in each case and find no merit to this question. All proceedings with reference to the issue of the refunding bonds are shown to be regular. It appears that the Board of County Commissioners made a study of the situation in the county and found that after the application of certain amounts in the sinking funds to the discharge of outstanding bonds of each special tax district, the remaining bonds could be refunded at considerable saving to the people of the county.

The evidence shows that the county commissioners purpose selling or exchanging only such refunding bonds as are necessary to replace the outstanding indebtedness and with that idea in view the provisions of Chapter 15772, Acts of 1931, are being strictly complied with. If it develops that more refunding bonds have been provided for by the resolution than will be necessary to replace the outstanding indebtedness of each of said special tax districts, the excess amount should not be authorized.

The decree of the chancellor in terms validates the bonds and authorizes the issue of the full amount named in the resolution. The amount of the outstanding refundable indebtedness of each of the involved districts was shown at the hearing and the decree should have limited the authority to issue bonds to an amount sufficient to refund the outstanding refundable obligations, and no more.

Another contention is made here to the effect that the county commissioners have entered into a contract to pay fiscal agents a fee of 2% on all bonds not exchanged but sold under the refunding plan. There is nothing in the record to show that the validity of the proposed refunding bonds is affected by an alleged fiscal agent's contract. It is too well settled to admit of question that the proceeds of refunding bonds must be used exclusively to discharge the old bonds and may not be used otherwise. That refunding bonds sell at a premium has no effect on the rule.

Whether or not the board of county commissioners have made a valid contract to pay fiscal agents for services in connection with this refunding bond issue, is not now before us and we, therefore, express no opinion in that regard. See State v. Sarasota County, 118 Fla. 629, 159 So. 797.

Other objections presented are found to be without merit.

The decree of the chancellor should be modified so as to validate, authorize and limit the issue of a sufficient amount of refunding bonds on behalf of each Special Road and Bridge District, as is shown to be required to refund the outstanding refundable bonds of each District, respectively, and not to increase the obligation so being refunded. When so modified, the decree will stand affirmed.

So ordered.

BROWN, C. J., TERRELL, BUFORD and THOMAS, J. J., concur.

WHITFIELD, CHAPMAN and ADAMS, J. J., dissent.