Advisory Opinion to Governor, In re

• Decision Date: 21 January 1971
• Docket Number: No. 40647,40647
• Citation: 243 So.2d 573
• Parties: In re ADVISORY OPINION TO the GOVERNOR.
• Court: Florida Supreme Court

Page 573

243 So.2d 573

In re ADVISORY OPINION TO the GOVERNOR.

No. 40647.

Supreme Court of Florida.

Jan. 21, 1971.

Robert L. Shevin, Atty. Gen., Stuart L. Simon, Deputy Atty. Gen. and W. Robert Olive, Jr., and Ron Sabo, Asst. Attys. Gen., for Governor Reubin O'D. Askew.

Arthur J. England, Jr., Sp. Tax Counsel, Florida House of Representatives, for Richard A. Pittigrew.

John E. Mathews, Jr., Jacksonville, for Associated Industries of Florida, Inc.

J. McHenry Jones, Pensacola, for St. Regis Paper Co., Gulf Marine Supply Co., Florida Drum Service, Southern Chemical Storage and Transit Co., Owsley Lumber Co. and J. B. Hopkins, P. A.

Donald T. Senterfitt, of Akerman, Senterfitt, Eidson & Wharton, Orlando, for Florida Bankers Ass'n.

Richard H. Frank, Tampa, for Florida Education Ass'n.

PER CURIAM.

Honorable Reubin O'D. Askew

Governor of Florida

The Capitol

Tallahassee, Florida

Dear Governor:

We have the honor to acknowledge your communication of January 5, 1971 requesting our advice pursuant to Section 1(c), Article IV, Constitution of Florida, F.S.A. relating to certain executive powers and duties.

Omitting the formal parts, your letter reads as follows:

'Section 1(c) of Article IV of the Florida Constitution (1968) authorizes me to request your opinion as to the interpretation of any portion of the Constitution upon any question affecting my executive duties and powers. I hereby request your opinion as to the interpretation of Section 5 of Article VII of the Constitution, in order to resolve questions affecting my constitutional powers and duties under section 3(c)(1) of Article III (relating to calls of special sessions of the Florida Legislature), section 1(d) of Article VII (relating to fiscal management of the State), section 1(a) of Article IV (relating to my executive responsibilities), and section 1(e) of Article IV (relating to my responsibility to recommend measures in the public interest).

'I assumed the office of Governor of the State on January 5, 1971, in the midst of the State's fiscal period which commenced July 1, 1970, and which will end on June 30, 1971. By law, I serve as the chief budget officer of the State (Fla.Stat.Ann., ch. 216, § 216.023) and I am required to submit a recommended budget to the members of the Legislature on or before February 15, 1971 (Fla.Stat.Ann., ch. 216, § 216.162). This recommended budget must include, among other things, a statement showing my estimate of revenues for the State's fiscal year commencing July 1, 1971, a recommendation as to any additional sources of revenue required to meet appropriations, and a statement of the amount required by each state agency (Fla.Stat.Ann., ch. 216, § 216.162(2)(b)-(d)).

'Preliminary estimates of the State's fiscal administrators have indicated that the State will not have adequate revenue to meet the State's expenses in the next fiscal year, unless additional sources of revenue are developed. Faced with the necessity of proposing a budget by February 15 which will provide 'for sufficient revenue to defray the expenses of the State' (Const. Art. VII, section 1(d)), one of my first duties as Governor will be to exercise my authority under Article IV, section 1(a) of the Constitution, to require officials of the State (a) to provide me with a summary of anticipated revenues from existing sources, and (b) to estimate for me the amounts of additional revenue which will be required from new sources.

'A principal new source of revenue that I will propose is a tax on the net income of corporations. I believe, and have publicly stated, that such a revenue measure is in the public interest. Pursuant to the authority conferred on me in Article IV, section 1(e) of the Constitution, I will recommend such a measure to the Legislature at the earliest opportunity. However, there exists some uncertainty as to whether such a tax is prohibited by section 5 of Article VII of the Constitution. That section provides, in relevant part, that:

"No tax upon * * * the income of residents or citizens of the State shall be levied by the State.'

'Since it is unclear whether corporations are to be considered 'residents' or 'citizens' of the State for this purpose, I cannot responsibly recommend to the Legislature, or predicate a State budget upon, a revenue measure which may be unconstitutional.

'If a corporate net income tax is constitutionally prohibited, then I will recommend 'in the public interest' that the Legislature adopt and submit to the people an amendment to the Constitution. However, because of the notice and publication requirements for constitutional amendments (Art. XI, section 5 of the Constitution), I will be unable to provide for adequate revenue for the State's fiscal year commencing July 1, 1971, unless I promptly exercise my constitutional power (Const. Art. III, section 3(c)(1)) to convene a special session of the Legislature for the purpose of considering such a constitutional amendment. It may be noted that my convening proclamation must state with particularity the purpose for the special session.

'It is apparent from the foregoing that my initial duties as Governor bring into play a number of my constitutional powers and that, because the constitutionality of a corporate net income tax directly affects these duties, an immediate clarification of Article VII, section 5 of the Constitution is essential to the performance of my obligation to 'take care that the laws be faithfully executed.' (Const. Art. IV, section 1(a)).

'Accordingly, I hereby request your opinion on the following questions:

'1. Do the terms 'residents' and 'citizens' in Article VII, section 5 of the 1968 Florida Constitution mean only natural persons, as opposed to artificial entities, organizations or associations created by or pursuant to law?

'2. If your answer to the first question is in the negative, is the Legislature prohibited by Article VII, section 5 of the Constitution from imposing a tax upon the net income of corporations which are formed under the laws of the State of Florida and

'(a) which derive their entire income from sources within the State?

'(b) which derive their entire income from sources without the State of Florida?

'(c) which derive their income in part from sources within and in part from sources without the State of Florida?

'3. If your answer to the first question is in the negative, is the Legislature prohibited by that section of the Constitution from imposing a tax upon the net income of corporation which are formed under the laws of any state, territory, country or jurisdiction other than the State of Florida,

'(a) if such corporations derive their entire income from sources within the State?

'(b) if such corporations derive their income in whole or in part from without the State but maintain a business situs or presence within the State?

'4. If your answer to the first question is in the negative and your answer to any part of the second or third question is also in the negative, is the Legislature prohibited by Article VII, Section 5 of the Constitution from imposing a tax upon the net income of entities, organizations and associations (other than corporations) which are artificial in nature and which have been created by or pursuant to the laws of Florida or any other state, territory, country or other jurisdiction?'

Upon receiving your letter, the Justices, pursuant to Section 1(c), Article IV, Constitution of Florida (1968) and implementing rule 2.1(h), 32 F.S.A. entered an interlocutory order saying:

'His Excellency, the Governor of Florida, pursuant to Section 1(c) of Article IV of the Florida Constitution, has requested the opinion of the Justices of this Court on the answer to the following question:

"Do the terms 'residents' and 'citizens' in Article VII, Section 5 of the 1968 Florida Constitution mean only natural persons, as opposed to artificial entities, organizations or associations created by or pursuant to law?', and other related questions.

'The Chief Executive has reminded this Court of the provision of Section 1(d) of Article VII relating to fiscal management of the State, Section 1(a) of Article IV relating to his executive responsibility, and Section 1(e) of Article IV relating to his constitutional responsibility to recommend measures in the public interest. He also informs us that pursuant to Florida Statutes, Chapter 216, Section 216.023, he is required by law to submit a recommended budget to the members of the Legislature on or before February 15, 1971 and referring us to Florida Statutes 216.162. He says that his recommended budget must include, among other things, A statement showing his estimate of revenues for the State's fiscal year commencing July 1, 1971, a recommendation as to any additional sources of revenue required to meet appropriations, and a statement of the amount required by each state agency. He informs us that he cannot perform his executive power and duty to see that the foregoing laws are enforced without a definition of the terms previously stated in his question.

'What the public knows generally, the Courts are presumed to know, and we take notice now of a substantial deficit between the requested budget and available revenue, which deficit, unless resolved in some appropriate manner, could result in fiscal chaos.

'There are many decisions of this Court prior to the adoption of the 1968 Constitution that would indicate we should exercise our discretion to refrain from answering the request. However, Section 1(c), Article IV, Constitution of 1968, enlarged to some extent the power of this Court to be of assistance, and our Rule 2.1(h) adopted in pursuant of such organic power has enabled us to treat such requests in somewhat the nature of an adversary proceeding by receiving briefs and arguments from interested persons.

'It has long been the policy of this Court to decline to express any opinion on the constitutionality vel non of a proposed ...