Treasure Coast Marina, LC, etc. v. the City of Fort Pierce, Florida, etc.

Supreme Court of Florida
____________
No. SC16-1107
____________
TREASURE COAST MARINA, LC, etc., et al.,
Petitioners,
vs.
THE CITY OF FORT PIERCE, FLORIDA, etc., et al.,
Respondents.
[June 15, 2017]
LEWIS, J.
This case is before the Court for review of the question certified in the
decision of the Fourth District Court of Appeal in City of Fort Pierce v. Treasure
Coast Marina, LC, 195 So. 3d 1141 (Fla. 4th DCA 2016). Our review involves
consideration of the exemption from ad valorem taxation contained in article VII,
section 3(a), of the Florida Constitution that applies to property owned and used
exclusively by municipalities for municipal or public purposes. Specifically, in
Treasure Coast Marina, the district court ruled upon the following question, which
the court certified to be of great public importance:
IN LIGHT OF FLORIDA DEPARTMENT OF REVENUE V. CITY
OF GAINESVILLE, 918 So. 2d 250 (Fla. 2005), DOES A
MUNICIPALLY OWNED AND OPERATED MARINA STILL
QUALIFY AS A TRADITIONALLY EXEMPT “MUNICIPAL OR
PUBLIC PURPOSE” UNDER ARTICLE VII, SECTION 3(a) OF
THE FLORIDA CONSTITUTION?
Id. at 1147. We have jurisdiction. See art. V, § 3(b)(4), Fla. Const. We answer
this question in the affirmative and approve the decision below.
FACTUAL BACKGROUND
This case commenced on October 28, 2011, when the owners of a private
marina filed a complaint challenging the tax-exempt status of the Fort Pierce City
Marina and the Fisherman’s Wharf Marina. Because the marinas were
respectively owned by the City of Fort Pierce and the Fort Pierce Redevelopment
Agency, the complaint was filed against those entities (collectively “the City”); the
St. Lucie County Tax Appraiser (the Property Appraiser); and the Executive
Director of the Florida Department of Revenue (the Department of Revenue). The
plaintiffs who filed the complaint, Treasure Coast Marina, LC; Raincross
Holdings, LC; and Riverfront Developers, LC (collectively “Riverfront”); own and
operate a private marina in Fort Pierce which is subject to ad valorem taxation. Of
relevance here, Riverfront’s amended complaint seeks declaratory and injunctive
relief on the basis that the Property Appraiser unconstitutionally granted ad
valorem tax exemptions during tax years 2011, 2012, and 2013 to the two marina
properties owned and operated by the City.
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Following discovery, cross-motions for final summary judgment were filed
and the parties conceded that there were no genuine issues of material fact. The
trial court ruled in favor of Riverfront, concluding that neither of the City marinas
qualified for the constitutional tax exemption. To reach this conclusion, the trial
court determined that both City marina properties at issue were not used for a
“municipal or public purpose,” and therefore, in its view the Property Appraiser
unconstitutionally granted the exemptions at issue. The trial court applied an
exceedingly narrow standard because it believed that we announced a new legal
standard and discarded years of precedent when we issued our decision in
Gainesville, 918 So. 2d 250.
The City and Property Appraiser jointly appealed to the Fourth District
Court of Appeal. On appeal, the Fourth District reversed. Treasure Coast Marina,
195 So. 3d at 1147. The Fourth District reasoned that this Court in Gainesville
“did not change the legal standard for municipal purpose under article VII, section
3(a) of the Florida Constitution, and that it used the same definition of municipal or
public purpose as in prior court opinions. Under this definition, municipal marinas
are traditionally considered exempt from taxation.” Id. at 1142-43. The district
court further reasoned that:
[t]he marinas are open to public use, are exclusively owned and
operated by the City, and provide recreation for local residents and
support the local economy by attracting non-local residents. . . . Thus,
not only do the City’s marinas serve a purpose that has been
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repeatedly and explicitly recognized as a “municipal or public
purpose,” they also operate specifically “for the comfort, convenience,
safety, and happiness of the municipality’s citizens[,]” and serve the
public purpose of developing recreational facilities in “increas[ing]
trade by attracting tourists and [providing] recreation for the citizens.”
Id. at 1146-47 (internal citations omitted). Noting the large boating community in
Florida and the economic impact of tax exemptions for municipal marinas, the
district court certified the question to this Court. Id. at 1147. This review follows.
ANALYSIS
We embark on our voyage by looking to the underlying constitutional
provisions at issue, and because this case involves questions of constitutional law,
our review is de novo. See Lewis v. Leon Cty., 73 So. 3d 151, 153 (Fla. 2011).
The first provision of note is contained in article VII, section 4, of the Florida
Constitution, and it specifically requires that real property be subject to ad valorem
taxation with certain exceptions that do not apply here:
By general law regulations shall be prescribed which shall secure a
just valuation of all property for ad valorem taxation . . . .
Art. VII, § 4, Fla. Const. However, our Constitution also recognizes that certain
properties owned and used exclusively by municipalities are constitutionally
exempt from ad valorem taxation, pursuant to article VII, section 3(a), which
provides in pertinent part:
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All property owned by a municipality and used exclusively by it for
municipal or public purposes shall be exempt from taxation.
Art. VII, § 3(a), Fla. Const.
Seeking to eject the City’s marinas from the safe harbor provided by that
constitutional language, Riverfront attempts to transform the ripples from our
decision in Gainesville into a landscape-altering tempest. Specifically, in
challenging the exemptions historically applied to the City Marina and the
Fisherman’s Wharf Marina, Riverfront contends that in Gainesville we announced
an entirely new, more restrictive standard for the application of the constitutional
exemption. While Riverfront acknowledges that the definition of “municipal or
public purpose” has not changed, it asserts that the Gainesville majority opinion
changed application of the test by focusing on the word “essential.” According to
Riverfront, our focus on the word “essential” in Gainesville was new and
represents a different and more narrow application of the tax exemption than is
reflected in prior cases, which Riverfront considers to be an indication that prior
precedent is no longer relevant.
Although Riverfront’s misplaced reliance on Gainesville is understandable
given the nature of the facts, our discussion in Gainesville, and the fact that
Gainesville emanated from this Court—our state’s highest court—Riverfront loses
its bearings by extrapolating Gainesville beyond its narrow confines onto areas of
law that have been well-settled for years. In reality, our decision in Gainesville
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was no more than a passing wave in the vast ocean of ad valorem taxation
precedent.
As evidence of this truth, in Gainesville we explicitly noted the distinct
circumstances we were reviewing. First, in Gainesville we did not have before us
an as-applied challenge to the issuance of an exemption, but rather a facial
challenge to a statute imposing ad valorem taxes on a municipality. 918 So. 2d at
253. Thus, our review was limited to determining whether there were any
circumstances under which the statute could be upheld. Id. at 256, 265. The
statute in question authorized municipalities to provide telecommunications
services for the first time but conditioned that authorization on a municipality
paying ad valorem taxes on the relevant properties. See id. at 253-54. Prior to the
statute authorizing municipalities to provide telecommunications services for the
first time ever, the Public Service Commission was not authorized to issue such
permits to a municipality. See id. Therefore, we recognized a second distinction
by explicitly noting in Gainesville that we were analyzing the exemption in the
context of a service that has historically been provided by the private sector rather
than any traditional municipal function. Id. at 265. This critical distinction
between telecommunication services and traditional municipal functions, such as
electric services, housing, and parks, signals both that Gainesville applies to a
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limited circumstance and that the cases addressing those traditional municipal
functions remain good law.
In fact, contrary to Riverfront’s understanding, our discussion in Gainesville
actually further supports the continued vitality of the traditional municipal function
course plotted by our precedent. For instance, as Riverfront acknowledges, in
Gainesville we recognized that although the constitutional tax exemption provision
was revised from its counterpart contained in the 1885 Constitution to curb
perceived abuses in favor of private operators seeking a profit, that end was not
advanced by changing the definition of “municipal or public purposes,” but rather
by requiring ownership and use by the municipality. Id. at 261 (“Thus, although
the framers of article VII, section 3(a) sought to limit the holding in Daytona
Beach Racing[ & Recreational Facilities District v. Paul, 179 So. 2d 349 (Fla.
1965)], they did so by requiring both ownership and exclusive use of the property
by the municipality rather than by narrowing the definition of municipal purposes.”
(emphasis added)). Further, we reaffirmed at length that the phrase “municipal or
public purposes” remains equal to that under prior precedent construing the terms,
both under the 1885 Constitution and the 1968 Constitution:
In the absence of any indication in the Constitution to the contrary, we
conclude that the term “municipal or public purposes” should be
construed in accordance with the definition utilized by the Court in its
prior decisions on the constitutional tax exemption. There is nothing
in the language of article VII, section 3(a) that evinces an intent to
create a more restrictive definition of “municipal or public purposes”
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for property that is owned and used exclusively by the municipality
than the definition applied to “municipal purposes” under the 1885
Constitution in McDavid[1] and Saunders[2] through the 1968 adoption
of the current provision. Although McDavid and Saunders rested at
least in part on judicial deference to the Legislature’s assessment of
what type of activity served municipal purposes, we have no basis to
conclude that a narrower construction was intended when the self-
executing exemption was included in the 1968 Constitution. To the
contrary, had the framers of article VII, section 3(a) intended to
narrow the exemption, they could have specifically defined
“municipal or public purposes,” or used different terms altogether.
. . . As stated by one observer shortly after the adoption of the 1968
Constitution, cases construing the constitutional municipal purposes
exemption and the statutory public purposes exemption “continue to
be good law even after the adoption of the new constitution.” Robert
F. Williams, Note, Property Tax Exemptions Under Article VII,
Section 3(a) of the Florida Constitution of 1968, 21 U. Fla. L. Rev.
641, 643 (1969).
We therefore conclude that the “municipal or public purposes” for
which municipally owned property must be exclusively used in article
VII, section 3(a) to qualify for an ad valorem tax exemption
encompass activities that are essential to the health, morals, safety,
and general welfare of the people within the municipality.
Id. at 263-64 (emphasis added). Thus, as all parties here agree, “municipal or
public purposes” in the constitutional tax exemption context—both before and
after Gainesville—“encompass activities that are essential to the health, morals,
safety, and general welfare of the people within the municipality.” Id. at 264.
1. State ex rel. Harper v. McDavid, 200 So. 100 (Fla. 1941).
2. Saunders v. City of Jacksonville, 25 So. 2d 648 (Fla. 1946).
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In performing a facial constitutionality analysis in Gainesville and applying
that definition of “municipal or public purposes,” we focused on the word
“essential,” noting that the term involves the concept of great need or necessity:
In putting this definition into practice, we focus on the word
“essential,” which is generally defined as something basic, necessary,
or indispensable. See Merriam-Webster’s Collegiate Dictionary 396
(10th ed. 1999). For example, an “essential element” is one on which
proof is required in order to establish a legal claim or criminal
offense. See, e.g., Rubano v. Dep’t of Transp., 656 So. 2d 1264, 1266
(Fla. 1995) (“Proof that the governmental body has effected a taking
of the property is an essential element of an inverse condemnation
action.”); Randall v. State, 760 So. 2d 892, 901 (Fla. 2000)
(“[P]remeditation is the essential element that distinguishes first-
degree murder from second-degree murder.”). Thus, inherent in the
word essential is the concept of great need or necessity.
Id. Riverfront seizes on this singular passage and our recognition of certain
distinctions of prior precedent to conclude that we narrowed the legal standard for
municipal or public purpose tax exemptions, suggesting that the standard requires
indispensability and a lack of private sector competition.
However, the very next two paragraphs in Gainesville indicate that
Riverfront reads too much into that language. Instead of discarding our prior
precedent, we embraced it and noted that “a thread of necessity also runs through
the precedent concerning tax exemptions for municipal use of municipally owned
property that we have discussed.” Id.
Accordingly, in Gainesville, we specifically distinguished
telecommunication services from “electrical power and public parks” because
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“telecommunication services have historically been provided by the private
sector.” Id. at 265. Further reflecting this distinction, we noted that “[t]he
presumption underlying [City of Sarasota v. Mikos, 374 So. 2d 458 (Fla. 1979)],
that vacant land owned by a municipality is held for a public purpose, would be
inappropriate for municipally owned property used by the municipality to engage
in a business venture to provide services in competition with the private sector.”
Id. at 261 n.12. Ultimately, in the next paragraphs we explained why traditional
municipal functions, such as providing public housing, electricity, and parks are
presumed to satisfy the “essential” component of a “municipal or public purpose”:
In McDavid, which held a tax exemption for a public housing facility
valid, the Legislature had declared that housing conditions were “a
menace to the health, safety, and morals of the people . . .
necessitat[ing] excessive expenditures for crime and fire prevention,
health, and welfare,” and that public safety “demand[ed]” replacement
of slums by “sanitary and better housing facilities.” In upholding the
tax exemption for property owned by a municipal power company
located in another county in Saunders, we recognized that the
Legislature “was doubtless well aware of the need for light, heat and
power by those areas outside of municipalities.” Similarly, in Ford,[3]
this Court held that the production of electricity by a municipality’s
power company served a municipal purpose. Such services are
essential in that municipally owned power companies have legally
protected monopolies within their territorial boundaries, and have
traditionally provided these services. Finally, the tax-exempt status
upheld in Mikos for vacant land held by a municipality to preserve
3. Ford v. Orlando Utilities Comm’n, 629 So. 2d 845 (Fla. 1994) (holding
tax-exempt under article VII, section (3)(a), Florida Constitution, a municipally
owned electric generating plant, but located in adjacent county and not serving
residents of the adjacent county).
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natural open spaces or for future needs is consistent with the
traditional municipal function of providing parks for the municipal
population. Cf. City of Miami Beach v. Hogan, 63 So. 2d 493, 495
(Fla. 1953) (stating that “[i]n all heavily populated municipalities the
police power should be exercised by municipal officials to afford all
of the people light, air, [and] an opportunity for recreation”).
Id. at 264-65 (some internal citations omitted). Therefore, in Gainesville we did
not announce a new standard, but rather simply recognized a critical distinction
between traditional municipal functions and functions historically provided by the
private sector for purposes of the “municipal or public purposes” constitutional tax
exemption.
Our district courts have had no trouble recognizing this critical distinction.
In Zingale v. Crossings at Fleming Island Community Development District, the
First District correctly rejected the contention that Gainesville altered—let alone
narrowed—the test for a “municipal or public purpose.” Zingale, 960 So. 2d 20,
24-25 (Fla. 1st DCA 2007), decision quashed sub nom. Crossings at Fleming
Island Cmty. Dev. Dist. v. Echeverri, 991 So. 2d 793 (Fla. 2008).4 At the time, the
district court recognized that our decision in Gainesville had noted that
municipalities traditionally provide parks and opportunity for recreation, but also
4. Although we reviewed and quashed Zingale on the question of standing
of one of the parties to raise a particular defense, there was standing with regard to
the issue of application of the tax exemption. We did not address or disturb the
correct analysis in that case. See generally Echeverri, 991 So. 2d 793.
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that telecommunication services have been historically provided by the private
sector. Id. at 25. Thus, the Zingale court affirmed the application of the
constitutional exemption to a “golf course, swimming pools, tennis courts, and
playgrounds.” Id. at 24-25. Likewise, even the two decisions upon which
Riverfront relies do not support its argument. The same year Zingale was decided,
the First District once again correctly recognized the distinction in City of
Gainesville v. Crapo, noting that this Court made clear in Gainesville that
telecommunication services are distinct in that they have traditionally been
provided by the private sector. City of Gainesville v. Crapo, 953 So. 2d 557, 563
(Fla. 1st DCA 2007). Similarly, in CAPFA Capital Corp. 2000A v. Donegan, the
Fifth District recognized that in Gainesville we “suggested that certain categories
of services which have been traditionally provided by municipalities, such as
public housing and utilities, are within the concept [of municipal and public
purposes] and thus remain exempt from taxation.” CAPFA, 929 So. 2d 569, 572
(Fla. 5th DCA 2006). Correctly applying the law, the CAPFA court then held that
a student housing investment project located in an adjacent county was not tax
exempt, specifically noting: “Nor are student housing projects at market prices a
traditional service historically provided by municipalities. Such services have
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typically been provided by the private sector, or the educational institutions
themselves.”5 Id. at 574.
Therefore, our inquiry turns to whether public marinas are traditional
municipal functions that are presumed to be tax exempt under article VII, section
(3)(a). While we have not previously addressed application of this exemption
specifically to municipally owned marinas, as the decision below recognized, other
district courts have opined on the subject. In Page v. City of Fernandina Beach,
the First District considered the tax-exempt status of a marina owned by the City of
Fernandina Beach, but operated by a private lessee for private gain. Page, 714 So.
2d 1070, 1077 (Fla. 1st DCA 1998). Due to the lease to a private operator, the
First District held that the marina was not entitled to a tax exemption.6 Id.
However, relevant here, the district court opined in dicta that a marina both owned
and operated by the municipality would be constitutionally exempt:
5. As a result, we are concerned by the errant dicta language in CAPFA
referring to “the more stringent definition of municipal or public purposes
espoused by the [Gainesville] case.” CAPFA, 929 So. 2d at 573. We expressly
disapprove that language, but recognize that ultimately the CAPFA court correctly
applied the law and aptly noted the distinction between traditional municipal
functions and those functions historically provided by the private sector.
6. Tax exemptions for private leasehold interests in municipally owned
property are subject to a stricter test known as the “governmental-governmental”
standard. See generally Sebring Airport Auth. v. McIntyre, 783 So. 2d 238 (Fla.
2001).
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Municipal operation of a marina is a legitimate municipal corporate
undertaking for the comfort, convenience, safety, and happiness of the
municipality’s citizens. Indeed, the uncontradicted expert testimony
was that operation of this marina constituted a proper municipal or
public function. When a city operates a marina it owns, marina
property it has not leased to a nongovernmental entity is exempt from
ad valorem taxation.
Id. at 1076-77 (emphasis added).
Although that portion of Page was dicta, in Islamorada, Village of Islands v.
Higgs, the Third District, sitting en banc, expressly approved that reasoning and
held that a marina owned and operated by a municipality was exempt. Islamorada,
882 So. 2d 1009, 1011 (Fla. 3d DCA 2003). In Islamorada, the marina generated
revenues that exceeded the marina’s expenses, its customers were both residents
and the general public, including out-of-town visitors, and the marina was
contained within a recreational facility. Id. at 1010-11. The Islamorada court’s
analysis turned on whether the municipality used the marina for municipal or
public purposes. Id. at 1011. In so analyzing, the district court noted that “the
term ‘municipal purpose’ embraces all activities essential to the health, morals,
protection and welfare of the municipality.” Id. (citing Greater Orlando Aviation
Auth. v. Crotty, 775 So. 2d 978, 980 (Fla. 5th DCA 2000)). It further noted that
“municipal functions” are functions which “specifically and peculiarly promote the
comfort, convenience, safety and happiness of the citizens of the municipality
rather than the welfare of the general public.” Id. (citing Crotty, 775 So. 2d at 980-
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81). Islamorada also expressly agreed with the First District’s dicta in Page,
emphasizing the language, “When a city operates a marina it owns, marina
property it has not leased to a nongovernmental entity is exempt from ad valorem
taxation.” Id. (citing Page, 714 So. 2d at 1076). The Third District concluded
Islamorada by noting that the marina fulfills a public purpose, “despite the fact that
the Village earns a profit from its operation of the Marina.” Id. We agree and
approve the analysis in Islamorada.
Indeed, we have little difficulty in concluding that marinas undoubtedly fall
in the same category of traditionally-exempt property occupied by public housing
projects, electrical infrastructure, and parks. We perceive at least three different
ways in which a nexus is formed between marinas and “municipal or public
purposes.”
First, one need not have special training to realize that marinas provide an
invaluable contribution to serving the transportation needs of coastal communities
dating to the birth of this nation and our state. Prior to January 22, 1912, when the
Florida East Coast Railway’s Over-Sea Railroad to Key West was completed, the
Florida Straits were only accessible by sea.7 Reflecting on the importance of
7. Linking the Keys, Library of Cong., https://www.loc.gov/item/today-in-
history/january-22 (last visited June 5, 2017).
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marinas and ports, at the time, nearly twenty thousand people lived in Key West. 8
Likewise, the record in this case discloses that the City Marina, although formally
established in 1938, traces its roots to various iterations of a town dock on the
same site dating back to the early 1900s. Further, Florida’s 1,197 statute miles of
coast line,9 significant contribution to the Intracoastal Waterway, and peninsular
shape quickly impress the historic importance of marine transportation in Florida
upon even the casual observer.
Second, public marinas also serve municipal or public purposes by ensuring
access to the waterfront, which grows more essential by the day as a result of
private development. Municipalities across the state have struggled in recent years
to protect both a view of and access to the water to the citizenry from the profit-
oriented grips of developers seeking to privatize the waterfront through the
construction of towering condominium and apartment buildings that block the
8. Linking the Keys, Library of Cong., https://www.loc.gov/item/today-in-
history/january-22 (last visited June 5, 2017). See generally Florida East Coast
Railway, The Story of a Pioneer: A Brief History of the Florida East Coast
Railway and Its Part in the Remarkable Development of the Florida East Coast 30
(1946).
9. Quick Facts, Florida Dep’t of State, http://dos.myflorida.com/florida-
facts/quick-facts/ (last visited June 5, 2017).
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waterfront from those who do not have the means or simply do not want to live in a
condominium.10
Third, marinas also serve to advance the recreational needs of a
municipality’s citizens. Landlocked citizens may break free from the confines of
their yards or apartment complexes and enjoy the magnificent Florida waters
through public marinas. Moreover, the fact that not everyone enjoys boating by
virtue of the varied and wide-ranging interests that render us human has no bearing
on our analysis. Florida courts have repeatedly recognized that similar taste-based
recreational activities, such as golf and tennis, are sufficiently essential recreational
activities that support application of the constitutional exemption. See, e.g.,
Zingale, 960 So. 2d at 24-26; Sun ‘N Lake of Sebring Imp. Dist. v. McIntyre, 800
So. 2d 715, 723 (Fla. 2d DCA 2001) (“It is possible that a golf course or tennis
courts, owned by a municipality and held open to the public, and not operated in
conjunction with a for-profit business, may serve an exclusively public purpose.”).
10. See, e.g., Nicholas Nehamas, As Waterfront Land Dries Up, Developers
Rush to Miami River, Miami Herald (June 7, 2015),
http://www.miamiherald.com/news/business/biz-monday/article23356026.html;
Harry Emilio Gottlieb, Letter to the Editor, Condos Eat Up Miami’s Waterfront
Property, Miami Herald (June 23, 2016),
http://www.miamiherald.com/opinion/letters-to-the-editor/article85671387.html.
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Furthermore, as the City contends, the Legislature has expressly recognized
the importance of the waterfront and the role of public marinas in furthering those
interests:
342.07 Recreational and commercial working waterfronts;
legislative findings; definitions.—
(1) The Legislature recognizes that there is an important state
interest in facilitating boating and other recreational access to the
state’s navigable waters. This access is vital to tourists and
recreational users and the marine industry in the state, to maintaining
or enhancing the $57 billion economic impact of tourism and the $14
billion economic impact of boating in the state annually, and to
ensuring continued access to all residents and visitors to the navigable
waters of the state. The Legislature recognizes that there is an
important state interest in maintaining viable water-dependent support
facilities, such as public lodging establishments and boat hauling and
repairing and commercial fishing facilities, and in maintaining the
availability of public access to the navigable waters of the state. The
Legislature further recognizes that the waterways of the state are
important for engaging in commerce and the transportation of goods
and people upon such waterways and that such commerce and
transportation is not feasible unless there is access to and from the
navigable waters of the state through recreational and commercial
working waterfronts.
§ 342.07, Fla. Stat. (2016).11 Moreover, the importance of public marinas and their
nexus to providing transportation and commerce was enshrined in the Florida
11. Public marinas are expressly contemplated within the definition of
“recreational and commercial waterfront.” § 342.201(2)(b), Fla. Stat. (2016) (“The
term includes water-dependent facilities that are open to the public and offer public
access by vessels to the waters of the state. . . . These facilities include . . . wet and
dry marinas . . . .”).
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Constitution when the voters passed the “Assessment of Working Waterfront
Property Based Upon Current Use” amendment in 2008, which is contained in
article VII, section 4(j), of the Florida Constitution and provides in pertinent part:
(j)(1) The assessment of the following working waterfront
properties shall be based upon the current use of the property:
a. Land used predominantly for commercial fishing purposes.
b. Land that is accessible to the public and used for vessel launches
into waters that are navigable.
c. Marinas and drystacks that are open to the public.
d. Water-dependent marine manufacturing facilities, commercial
fishing facilities, and marine vessel construction and repair facilities
and their support activities.
Art. VII, § 4(j)(1), Fla. Const. (2008) (emphasis added); Amends. Proposed by
Tax’n & Budget Reform Comm’n, Revision Nos. 3, 4, and 6, 2008, filed with the
Secretary of State April 28, 2008; adopted 2008.12
Therefore, because public marinas have been considered traditional
municipal functions and our decision in Gainesville did not announce any new
12. We note that this amendment concerning the assessed taxable value of
such property does not in any way intrude on the applicability of the constitutional
exemption. For instance, there are publicly owned marinas that are leased to
private operators that would not qualify for the exemption. See, e.g., Page, 714 So.
2d 1070. The amendment merely protects against assessment of the highest and
best use of the waterfront property on which a marina would sit, which might, for
instance, be assessed at a higher tax rate if the property could support construction
of a sophisticated office tower.
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standard, we answer the certified question in the affirmative and expressly approve
the decision below.
Having untangled the constitutional question, we now turn to the record in
this case and the trial court’s entry of summary judgment in favor of Riverfront.13
In declaring the tax exemptions at issue here unconstitutional, the trial court
essentially ruled that Riverfront had rebutted the presumption of tax-exempt status
for properties owned and used exclusively by a municipality for municipal or
public purposes that attaches where the property involves a traditional municipal
function, such as a public marina. We disagree with that understanding.
Nothing in the record indicates that the marinas in this case do not serve a
municipal or public purpose. Riverfront contends that the placement of a lock on
some of the docks destroys the public nature of these marinas.14 However, the
protection of boats and other property from vandalism and crime is entirely
consistent with the operation of a marina, and the record indicates that the locks
here were put in place to address security concerns. Moreover, the fact remains
that the marinas in this case are open to the public and any member of the public
13. Our review of orders entering summary judgment is also de novo.
Volusia Cty. v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126, 130 (Fla. 2000).
14. Three of the eight docks at the City Marina are usually locked. The
only dock at the Fisherman’s Wharf Marina is usually locked. The record
indicates that these locks were put in place by the City due to security concerns.
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may go to the office at either marina, as would a patron at any public golf club or
tennis club with an office. Furthermore, while most of the slips may be leased to
individuals, the record here indicates that the marinas do not charge any fee for
boaters who wish to dock just for the day. Similarly unavailing, the fact that more
nonresidents than residents of the municipality might use the marina is also
entirely consistent with the objectives of a municipal marina to operate as a
component of the transportation infrastructure and bring economic activity into the
municipality.
Further, depriving the City of its constitutional right to the exemptions at
issue here on the basis that marinas may also be run by the private sector or
compete with the private sector would sink the exemption in nearly every context
because almost any function today may be equally provided by the private sector.
Cf. Saunders, 25 So. 2d at 650 (“We are not justified in declaring the act invalid
because it might enable the City to compete with private utilities required to pay
taxes.”).15 Such an analysis ignores the fact that publicly owned and operated
15. In Saunders, this Court noted that the Legislature was a safeguard
against abuses that might allow municipalities to “take business from competing
tax paying utilities.” Id. (“Our answer, if any is needed, is that the legislature is the
arbiter of this question and its judgment under Article 8, Section 8, Constitution, is
final unless an abuse of power is shown.”). While the constitutional provision at
issue in Saunders was replaced with article VII, section 3(a), which is now self-
executing, we note that the concern of cities abusing tax-exempt status to take
business away from competing private entities is likewise tamed by the
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facilities are open to the public, as opposed to private facilities which generally
may freely pick and choose among those clients they wish to serve, or be far more
motivated by pecuniary interests. In any event, here the Property Appraiser has
correctly created separate tax folios for the portions of the marina properties that
are leased to private operators and the City pays ad valorem taxes on those
portions.16
Therefore, Riverfront has not carried its burden to rebut the presumption that
the municipally owned properties here that are used exclusively by the
municipality to provide traditional municipal functions are constitutionally exempt
from ad valorem taxation. Accordingly, we conclude that the district court
correctly reversed the trial court for erroneously disturbing the tax-exempt status of
the City’s marinas.
CONCLUSION
For the reasons expressed above, we reaffirm that our decision in
Gainesville did not announce a new standard for applying the municipal or public
purposes tax exemption contained in article VII, section 3(a), of the Florida
requirement in article VII, section (3)(a), that the municipality simultaneously own
and exclusively use the tax exempt property.
16. For this reason, the “exclusive use” requirement of the constitutional
exemption is not at issue on this record.
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Constitution. We also hold that for purposes of applying that constitutional tax
exemption, a public marina owned and operated by a municipality is a traditional
municipal function that carries a presumption of tax-exempt status. Accordingly,
we answer the certified question in the affirmative, approve the decision below,
and direct upon remand that the trial court enter a final summary judgment in favor
of the Respondents recognizing that the public marinas at issue here are properly
tax-exempt for the tax years at issue.
It is so ordered.
LABARGA, C.J., and PARIENTE, QUINCE, CANADY, POLSTON, and
LAWSON, JJ., concur.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION, AND
IF FILED, DETERMINED.
Application for Review of the Decision of the District Court of Appeal – Certified
Great Public Importance
Fourth District - Case No. 4D14-3064
(St. Lucie County)
Brigid F. Cech Samole of Greenberg Traurig, P.A., Miami, Florida; and Jerry
Stouck of Greenberg Traurig, LLP, Washington, District of Columbia,
for Petitioners
Robert V. Schwerer and James T. Walker of Hayskar, Walker, Schwerer, Dundas
& McCain, P.A., Fort Pierce, Florida,
for Respondents City of Fort Pierce and Fort Pierce Redevelopment Agency
Loren E. Levy and Jon F. Morris of The Levy Law Firm, Tallahassee, Florida,
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for Respondent Ken Pruitt, St. Lucie County Property Appraiser
Harry Morrison, Jr., and Kraig Conn of Florida League of Cities, Tallahassee,
Florida; and Benjamin K. Phipps of Phipps & Howell, Tallahassee, Florida,
for Amicus Curiae Florida League of Cities
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