Alamo Rent-A-Car, Inc. v. Sarasota-Manatee Airport Authority

• Decision Date: 25 August 1987
• Docket Number: SARASOTA-MANATEE,RENT-A-CA,INC,No. 86-3396,86-3396
• Citation: 825 F.2d 367
• Parties: ALAMO, a Florida corporation, Plaintiff-Appellee, Cross-Appellant, v.AIRPORT AUTHORITY, a political subdivision of the State of Florida, Defendant-Appellant, Cross-Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 367

825 F.2d 367

ALAMO RENT-A-CAR, INC., a Florida corporation, Plaintiff-Appellee, Cross-Appellant, v. SARASOTA-MANATEE AIRPORT AUTHORITY, a political subdivision

of the State of Florida, Defendant-Appellant,

Cross-Appellee.

No. 86-3396.

United States Court of Appeals, Eleventh Circuit.

Aug. 25, 1987.

A. Lamar Matthews, Jr., Theodore C. Eastmoore, Frazer F. Hilder, Sarasota, Fla., for defendant-appellant, cross-appellee.

Howard L. Conklin, Ft. Lauderdale, Fla., Donald A. Gifford, Craig B. Gliddon, Thomas C. MacDonald, Tampa, Fla., Lucas A. Powe, Jr., University of Texas Law School, Austin, Tex., for plaintiff-appellee, cross-appellant.

Appeals from the United States District Court for the Middle District of Florida.

Before TJOFLAT and VANCE, Circuit Judges, and ATKINS ^*, Senior District Judge.

TJOFLAT, Circuit Judge:

I.

This case presents a constitutional challenge to a local economic regulation (a user fee) promulgated by the Sarasota-Manatee Airport Authority (the Authority), a local governmental agency created by the Florida legislature. The Authority owns and operates the Sarasota-Bradenton Airport (the airport). In order to meet its operating expenses and other expenses not covered by state and federal grants, the Authority has established, through negotiated agreements and unilateral resolutions, a schedule of user or privilege fees. These fees apply to a wide range of activities that are conducted on the airport's facilities, and include airplane landing fees, fees and lease payments for car rental companies located on airport property, parking fees, rent from restaurants and gift shops, and fees paid by taxis and limousines serving the airport.

In 1982, the Authority began considering measures to alleviate ground traffic congestion and to obtain revenue from operators of "courtesy vehicles," which transport customers to and from the main airport terminal and certain businesses located on the airport property. The Authority was concerned with two categories of businesses: (1) hotels and motels, and (2) off-airport car rental companies. Off-airport car rental companies, such as appellee Alamo Rent-A-Car, Inc. (Alamo), are car rental companies that do not rent facilities on airport property and thus must transport customers from the airport to their remote locations. In contrast, on-airport car rental companies lease counter space inside the airport terminal, as well as land adjacent to the terminal to be used for storing and maintaining cars. ¹

On July 27, 1982, the Authority adopted two resolutions, one governing courtesy vehicles operated by hotels and motels, and one governing the off-airport car rental companies' courtesy vehicles. The resolution concerning hotels and motels established a monthly courtesy vehicle fee of $50 or $100, depending on the size of the vehicle, or an annual fee of $800 per vehicle. The resolution governing off-airport car rental companies, including Alamo, contained an extensive series of requirements for securing courtesy vehicle permits. For example, companies seeking a permit had to provide proof of financial responsibility, identify their managerial personnel, and pay a user fee. The user fee applicable to these car rental companies was "10% of all gross business receipts derived from the rental of automobiles to passengers picked up at the Airport," payable monthly for the duration of the permit. For companies conducting a substantial volume of business involving airport passengers, such as Alamo, the ten percent fee greatly exceeds the flat fee applicable to hotels and motels.

On July 29, 1982, Alamo brought suit in the district court, seeking to enjoin the Authority's imposition of the ten percent user fee on it and other off-airport car rental companies. Alamo claimed that the user fee violated the equal protection clause of the United States Constitution, as well as other provisions of state and federal law not relevant to this appeal. The district court held that the user fee denied Alamo the equal protection of the laws and permanently enjoined the enforcement of the user fee being charged off-airport companies. We reverse. ²

II.

A.

The equal protection clause of the fourteenth amendment provides that "[n]o State shall ... deny to any person within its jurisdiction the equal protection of the laws." U.S. Const. amend. XIV, Sec. 1. The clause "is essentially a direction that all persons similarly situated should be treated alike." City of Cleburne v. Cleburne Living Center, 473 U.S. 432, 439, 105 S.Ct 3249, 3254, 87 L.Ed.2d 313 (1985) (citing Plyler v. Doe, 457 U.S. 202, 216, 102 S.Ct. 2382, 2394, 72 L.Ed.2d 786 (1982)). Legislation, such as that involved in this case, that does not impinge on fundamental rights or employ suspect classifications is presumed to be valid and will be upheld if it is rationally related to a legitimate state interest. Cleburne Living Center, 473 U.S. at 440, 105 S.Ct. at 3254-55. Moreover, the equal protection clause allows governmental bodies wide latitude in enacting social and economic legislation; the federal courts do not sit as arbiters of the wisdom or utility of these laws. See id. at 439, 105 S.Ct. at 3254; Minnesota v. Clover Leaf Creamery Co., 449 U.S. 456, 469, 101 S.Ct. 715, 726, 66 L.Ed.2d 659 (1981).

In this case, the district court held that the Authority denied Alamo the equal protection of the laws on two grounds. First, the court found no rational basis for assessing a flat fee for hotel and motel courtesy vehicles while charging the similarly situated off-airport car rental companies a substantial percentage of their receipts.

Second, the court determined that the Authority also violated the equal protection clause because it treated off-airport car rental companies in a similar manner as the differently situated on-airport companies. Each on-airport car rental company has a negotiated agreement with the Authority. Pursuant to these contracts, the on-airport companies lease counter space, parking spaces, and land adjacent to the airport terminal. In return, the companies pay a fixed rent plus a ten percent concession fee on receipts from all car rentals at their airport facilities. The district court found that the Authority, by charging off-airport companies a ten percent user fee, in effect treated those companies in a manner similar to the on-airport companies, which pay a ten percent concession fee but which also receive substantial benefits from their location on the airport grounds. The court concluded that there was no rational basis for establishing comparable fees for both categories of companies.

B.

We first examine whether the Authority violated the equal protection clause in assessing a flat fee for hotel and motel courtesy vehicles while charging Alamo ten percent of the receipts attributable to its customers from the airport. The Authority's first contention on appeal is that off-airport car rental companies are not similarly situated with hotels and motels, because the two categories involve companies in different lines of business. Differences in the types of business conducted by these companies is certainly a factor in equal protection analysis, and in some cases this distinction alone may be sufficient to uphold the challenged legislation. See Allied Stores v. Bowers, 358 U.S. 522, 526-27, 79 S.Ct. 437, 440-41, 3 L.Ed.2d 321 (1959) ("The State may impose different specific taxes upon different trades and professions and may vary the rate of excise upon various products. It is not required to resort to close distinctions or to maintain a precise, scientific uniformity with reference to composition, use or value.") (citations omitted); State Board of Tax Comm'rs v. Jackson, 283 U.S. 527, 537-42, 51 S.Ct. 540, 543-45, 75 L.Ed. 1248 (1931) (states may establish classifications based upon the types of business transacted for purposes of regulation, excise taxes, and license taxes). As the Supreme Court observed in Williamson v. Lee Optical, 348 U.S. 483, 489, 75 S.Ct. 461, 465, 99 L.Ed. 563 (1955) (citations omitted),

[t]he problem of legislative classification is a perennial one, admitting of no doctrinaire definition. Evils in the same field may be of different dimensions and proportions, requiring different remedies. Or so the legislature may think. Or the reform may take one step at a time, addressing itself to the phase of the problem which seems most acute to the legislative mind. The legislature may select one phase of one field and apply a remedy there, neglecting the others.

Even assuming, however, that off-airport car rental companies and hotels and motels are similarly situated for purposes of a user fee on courtesy vehicles, the Authority's scheme of user fees does not lack a rational basis and is not a "wholly arbitrary act," City of New Orleans v. Dukes, 427 U.S. 297, 303-04, 96 S.Ct. 2513, 2516-17, 49 L.Ed.2d 511 (1976) (per curiam). The Authority offers five justifications for the ten percent user fee. We need only address one of these justifications to uphold the constitutionality of that fee. ³

The Authority sought to establish a schedule of fees that reflects the different benefits the various categories of users received from the airport. Indeed, the Authority tailored its entire schedule of fees to account for differences in vehicle use and the differing benefits realized by vehicles at the airport. As already noted, hotels and motels pay a flat fee, on-airport car rental companies pay ten percent of all receipts plus a fixed rent, and off-airport car rental companies pay ten percent of receipts from customers picked up at the airport. The Authority allows private automobiles that remain on the airport roadway to operate free of charge. Operators of airport parking lots pay fifty to seventy-five percent of their gross receipts, or a minimum fee, whichever is higher. Taxicab operators pay access fees based on a combination of monthly license fees and...