City of Miami v. McGrath

• Decision Date: 11 July 2002
• Docket Number: No. SC01-1562.,SC01-1562.
• Citation: 824 So.2d 143
• Parties: CITY OF MIAMI, Appellant, v. Patrick McGRATH III, et al., Appellee.
• Court: Florida Supreme Court

824 So.2d 143

CITY OF MIAMI, Appellant, v. Patrick McGRATH III, et al., Appellee.

No. SC01-1562.

Supreme Court of Florida.

July 11, 2002.

Alejandro Vilarello and Maria J. Chiaro, Miami, FL; and Joseph H. Serota, Mitchell A. Bierman, and Christopher F. Kurtz of Weiss, Serota, Helfman, Pastoriza & Guedes, P.A., Miami, FL, for Appellant.

Thomas J. Korge and Christopher G. Korge of Korge & Korge, Coral Gables, FL; and Mark J. Heise and David Markarian of Heise Markarian Foreman, Miami, FL, for Appellees.

Robert A. Ginsburg, Miami-Dade County Attorney, and Jess McCarty, Assistant County Attorney, Miami, FL, for Miami-Dade County and Laureen Varga, Intervenors/Appellees.

PARIENTE, J.

We have on appeal a decision of the Third District Court of Appeal declaring invalid a state statute. See McGrath v. City of Miami, 789 So.2d 1168 (Fla. 3d DCA 2001)

. We have jurisdiction. See art. V, § 3(b)(1), Fla. Const. Because we conclude that section 218.503(5)(a), Florida Statutes (1999), constitutes a special law authorizing the imposition of non-ad valorem taxes in violation of the Florida Constitution, we affirm the Third District's decision in this case.

BACKGROUND

In 1999,¹ the Florida Legislature enacted section 218.503(5), which authorizes a municipality to impose a parking tax but restricts which municipalities may impose the tax as follows:

(5)(a) The governing authority of any municipality with a resident population of 300,000 or more by April 1, 1999, and which has been declared in a state of financial emergency pursuant to this section within the previous two fiscal years may impose a discretionary per vehicle surcharge of up to 20 percent on the gross revenues of the sale, lease, or rental of space at parking facilities within the municipality that are open for use to the general public.

. . . .

(c) This subsection is repealed on June 30, 2006.²

In July 1999, the City of Miami ("City") implemented the statute by passing an ordinance authorizing the levying of a parking tax, which became effective September 1, 1999.

Patrick McGrath, III, filed a complaint against the City, challenging the constitutionality of the ordinance and section 218.503(5)(a). McGrath claimed that the statute constitutes a special law passed under the guise of a general law, and thus is unconstitutional under article VII, sections 1(a) and 9(a), of the Florida Constitution.³ Miami-Dade County ("County"), and one of its employees, Laureen Varga, challenged the constitutionality of the ordinance and section 218.503(5)(a) in another case, and intervened as plaintiffs in this case.

The City and McGrath filed cross-motions for summary judgment, and the County and Varga joined in support of McGrath's motion. The trial court granted the City's motion for summary judgment, upholding the constitutionality of the ordinance and section 218.503(5)(a). The Third District reversed, however, holding that section 218.503(5)(a) is an unconstitutional special law,

because by anchoring the 300,000 population classification to the specific date of April 1, 1999, it does not operate uniformly among all cities that reach the 300,000 population threshold as is required by general law. Cities that reach the population threshold after April 1, 1999 are forever excluded from the class. As worded, the statute is no different than if it had identified by name the three particular cities to which it relates. See Fort v. Dekle, 138 Fla. 871, 190 So. 542 (1939); Walker v. Pendarvis, 132 So.2d 186 (Fla.1961); Ocala Breeders' Sales Company, Inc. v. Florida Gaming Centers, Inc., 731 So.2d 21 (Fla. 1st DCA 1999).

Since a statute which constitutes a special law cannot impose a non-ad valorem tax, the statute is unconstitutional. See Alachua County v. Adams, 702 So.2d 1253 (Fla.1997)

. Accordingly, the trial court erred in finding the ordinance was validly enacted and in granting summary judgment for the City. Therefore, the case must be reversed and the cause remanded to grant summary judgment in favor of the appellants/taxpayers.

McGrath, 789 So.2d at 1169.

ANALYSIS

The issue in this case is whether section 218.503(5)(a), which authorizes only certain municipalities to impose a parking tax, constitutes a special law in violation of the Florida Constitution. Section 218.503(5)(a) comes before this Court "clothed with a presumption of constitutionality," Department of Legal Affairs v. Sanford-Orlando Kennel Club, Inc., 434 So.2d 879, 881 (Fla.1983), and this Court's review of the Third District's decision is de novo. See Florida Fish & Wildlife Conservation Comm'n v. Caribbean Conservation Corp., Inc., 789 So.2d 1053, 1054 (Fla. 1st DCA 2001)

(holding that whether a state statute is constitutional is a pure question of law subject to de novo review).

Rather than applying to all municipalities, the statute applies only to municipalities that have a resident population of 300,000 or more on April 1, 1999, and have been declared in a state of financial emergency pursuant to this statute within the previous two fiscal years. By virtue of the limiting date of April 1, 1999, only three municipalities—Miami, Tampa, and Jacksonville⁴ —potentially qualify as being able to impose the parking tax.⁵ Thus, appellees contend that the statute is effectively no different than if those three municipalities had been identified by name in the statute.

The Florida Constitution allows a local government to impose a non-ad valorem tax only as authorized by general law. See art. VII, §§ 1(a), 9(a), Fla. Const. In other words, the Florida Constitution prohibits the Legislature from authorizing a local government from imposing a non-ad valorem tax by special law. We explained the purpose of the constitutional prohibition against the Legislature passing a special law authorizing municipalities to levy non-ad valorem taxes in Alachua County v. Adams, 702 So.2d 1253, 1254 (Fla.1997):

The overriding purpose of [article VII, section (1)(a)] is to make a constitutional division of tax revenues between those available for state uses and those reserved for local government. The phrase "all other forms of taxation" obviously refers to any tax other than those previously designated ad valorem taxes on real property and tangible personal property. This provision is designed to prevent the legislature from undermining non-ad valorem tax sources needed to support state government by the enactment of special laws authorizing local governments to impose non-ad valorem taxes for local purposes.

... [Article VII, section 9(a)] permits the legislature to authorize counties to levy non-ad valorem taxes, of whatever form or description, but only by general law. A determination that a special law may allow a county to redirect the tax proceeds in a manner explicitly contrary to the general law which authorized the tax in the first place would clearly undercut the purposes of article VII, section 9(a).

(Emphasis supplied.)⁶

In this case, it is undisputed that the City's parking tax constitutes a non-ad valorem tax that was authorized by the Legislature's passage of section 218.503(5)(a). Therefore, the only question in this case is whether section 218.503(5)(a) constitutes a special law. This Court has explained the distinction between general laws and special laws:

A law that operates universally throughout the state, uniformly upon subjects as they may exist throughout the state, or uniformly within a permissible classification is a general law. State ex rel. Landis v. Harris, 120 Fla. 555, 163 So. 237 (Fla.1934). We recognize that the legislature has wide discretion in establishing statutory classification schemes and that a law applying uniformly within a permissible classification is a general law. Shelton v. Reeder, 121 So.2d 145 (Fla.1960). A statute relating to a subdivision of the state, based upon proper distinctions and differences that inhere in or are peculiar or appropriate to a class, is a general law. Department of Legal Affairs v. Sanford-Orlando Kennel Club, Inc., 434 So.2d 879 (Fla.1983); Shelton. ... Statutes that employ arbitrary classification schemes are not valid as general laws. West Flagler; Shelton.

Department of Bus. Regulation v. Classic Mile, Inc., 541 So.2d 1155, 1157 (Fla.1989)

.

We then explained the definition of a special law:

The constitution defines a special law as a special or local law. Art. X, § 12(g), Fla. Const. As explained in case law,

a special law is one relating to, or designed to operate upon, particular persons or things, or one that purports to operate upon classified persons or things when classification is not permissible or the classification adopted is illegal; a local law is one relating to, or designed to operate only in, a specifically indicated part of the State, or one that purports to operate within classified territory when classification is not permissible or the classification is illegal.

State ex rel. Landis v. Harris, 120 Fla. 555, 562-63, 163 So. 237, 240 (1934) (citations omitted); State ex rel. Gray v. Stoutamire, 131 Fla. 698, 179 So. 730 (1938); State ex rel. Buford v. Daniel, 87 Fla. 270, 99 So. 804 (1924). See generally 10 Fla. Jur.2d Constitutional Law § 330 (1979).

Id.

To determine whether section 218.503(5)(a) constitutes a special law, we must decide whether the law is designed to operate upon particular municipalities through its restrictive classification system, and whether the classification in this case, which limits application of the statute to municipalities with over 300,000 residents on or before April 1, 1999, is arbitrary. In other words, we must determine whether this statute is "based upon proper distinctions and differences that inhere in or are peculiar or appropriate to a class," Classic Mile, 541 So.2d at 1157, or whether this statute is designed to operate upon or benefit only particular municipalities and thus is essentially no different than if the statute had identified the particular municipalities...