Debary Real Estate Holdings, LLC v. State

• Decision Date: 10 May 2013
• Docket Number: No. 1D12–1654.,1D12–1654.
• Citation: 112 So.3d 157
• Parties: DEBARY REAL ESTATE HOLDINGS, LLC, and Steven Costa, Appellants, v. STATE of Florida, DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF PARI–MUTUEL WAGERING, West Volusia Racing, Inc. f/k/a Volusia Jai–Alai, Inc., and License Acquisitions, LLC, Appellees.
• Court: Florida District Court of Appeals

112 So.3d 157

DEBARY REAL ESTATE HOLDINGS, LLC, and Steven Costa, Appellants,
v.
STATE of Florida, DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, DIVISION OF PARI–MUTUEL WAGERING, West Volusia Racing, Inc. f/k/a Volusia Jai–Alai, Inc., and License Acquisitions, LLC, Appellees.

No. 1D12–1654.

District Court of Appeal of Florida,
First District.

May 10, 2013.

Held Unconstitutional

West's F.S.A. § 550.054(14)

[112 So.3d 159]

David S. Romanik of David S. Romanik, P.A., Oxford, for Appellants.

Barry Richard of Greenberg Traurig, P.A., Tallahassee, for Appellee License Acquisition, LLC; J. Layne Smith, General Counsel, and Garnett W. Chisenhall, Chief Appellate Counsel of Department of Business and Professional Regulation, Tallahassee, for Appellee, State of Florida, Department of Business and Professional Regulation, Division of Pari–Mutuel Wagering; and J. Riley Davis of Akerman Senterfitt, Tallahassee, for Appellee West Volusia Racing, Inc.

[112 So.3d 160]

ON MOTIONS FOR REHEARING AND CLARIFICATION
PER CURIAM.

Appellants and Appellee Department of Business and Professional Regulation, Division of Pari–Mutuel Wagering, have filed motions for clarification of our January 24, 2013, opinion. Appellee West Volusia Racing, Inc., has filed a motion for rehearing. We deny the motion for rehearing. In consideration of the motions for clarification, we withdraw our previous opinion and substitute the following in its place. We grant clarification to the extent reflected in this corrected opinion.

This appeal arises from a final order entered after a summary judgment declaring chapter 2009–170, section 6, Laws of Florida, (“the Act”) a valid general law. In pertinent part, the Act allows the holder of a pari-mutuel permit to change the class of the permit from jai-alai to greyhound if the permit or permitholder meets three enumerated criteria. In the proceedings below, Debary Real Estate Holdings, LLC, and Steven Costa, Appellants, sought a declaratory judgment that the Act is a special law enacted in violation of the notice or referendum requirement of article III, section 10, of the Florida Constitution. Upon a motion for summary judgment by Appellee License Acquisitions, LLC, an intervenor, the trial court reached the opposite conclusion. Because the Act is a special law unconstitutionally enacted in the guise of a general law, as shown through undisputed evidence in the record, we conclude that the trial court should have granted an earlier motion for summary judgment by Appellants.

I. FACTS

The Act added the following text to section 550.054, Florida Statutes, effective July 1, 2010:

(14)(a) Any holder of a permit to conduct jai alai may apply to the division to convert such permit to a permit to conduct greyhound racing in lieu of jai alai if:

1. Such permit is located in a county in which the division has issued only two pari-mutuel permits pursuant to this section;

2. Such permit was not previously converted from any other class of permit; and

3. The holder of the permit has not conducted jai alai games during a period of 10 years immediately preceding his or her application for conversion under this subsection.

(b) The division, upon application from the holder of a jai alai permit meeting all conditions of this section, shall convert the permit and shall issue to the permitholder a permit to conduct greyhound racing. A permitholder of a permit converted under this section shall be required to apply for and conduct a full schedule of live racing each fiscal year to be eligible for any tax credit provided by this chapter. The holder of a permit converted pursuant to this subsection or any holder of a permit to conduct greyhound racing located in a county in which it is the only permit issued pursuant to this section who operates at a leased facility pursuant to s. 550.475 may move the location for which the permit has been issued to another location within a 30–mile radius of the location fixed in the permit issued in that county, provided the move does not cross the county boundary and such location is approved under the zoning regulations of the county or municipality in which the permit is located, and upon such relocation may use the permit for the conduct of pari-mutuel wagering and the operation of a cardroom. The provisions

[112 So.3d 161]

of s. 550.6305(9)(d) and (f) shall apply to any permit converted under this subsection and shall continue to apply to any permit which was previously included under and subject to such provisions before a conversion pursuant to this section occurred.

Ch. 2009–170, § 6 at 1777–78, Laws of Fla.

Appellees West Volusia Racing, Inc., and License Acquisitions applied for the conversion of their jai-alai permits under section 550.054(14)(a) on the day the Act became effective. Approximately three weeks later, Appellee Department of Business and Professional Regulation, Division of Pari–Mutuel Wagering (the “Division”), granted the applications. Shortly thereafter, Appellant Debary instituted this declaratory judgment action. Appellant Costa later joined the suit as an additional plaintiff. Appellants contended below, and now argue on appeal, that the Act is a special law because the criterion specified in section 550.054(14)(a) 1 permanently closes the class of permits eligible for conversion. This criterion provides that a permit is not eligible unless it is “located in a county in which the division has issued only two pari-mutuel permits pursuant to [section 550.054].” § 550.054(14)(a) 1. According to Appellants, at the time the Act was passed, precisely two permits met this criterion, and no reasonable possibility exists that any other permits will ever qualify for conversion absent a change in the law. Seeking summary judgment, Debary and Costa supported this contention with the deposition testimony of Jim Barnes, whose position with the Division requires him to process the applications for permit conversion under section 550.054(14)(a).

Barnes opined that a permit cannot qualify for conversion under section 550.054(14)(a) unless it is located in a county that has exactly two permits issued under section 550.054 (no more and no fewer). He also provided the following factual information, which is undisputed. Jai-alai permits, including those recently converted under the Act, exist in nine Florida counties: Broward, Gadsden, Hamilton, Hillsborough, Marion, Miami–Dade, Palm Beach, St. Lucie, and Volusia. Of these counties, only Marion, Palm Beach, and Volusia have precisely two permits that have been issued under section 550.054. Three counties have only one such permit, and the remaining counties have more than two. The three counties with one section 550.054 permit, which is a jai-alai permit, are Gadsden, Hamilton, and St. Lucie. The one permit located in Gadsden County has been previously converted from a jai-alai to greyhound and then back to jai-alai.

According to Barnes, of the nine counties with jai-alai permits, only Volusia and Palm Beach meet the qualification criteria. He explained that Marion County does not qualify for conversion because there is no greyhound permit in the county with which the jai-alai permit could pair. This opinion is apparently based on the assumption that no jai-alai permitholder would convert its permit under section 550.054(14)(a) unless the permitholder could enter into a leasing arrangement with another greyhound facility and take advantage of the card-room provision of section 550.054(14)(b). Barnes also confirmed, however, that Marion County's jai-alai permit is active.

Barnes' testimony indicates that the issuance of new section 550.054 permits in the counties with a jai-alai permit that is currently the only section 550.054 permit in the county would be legally impossible due to restrictions contained in section 550.054(2). This provision prohibits the issuance of a permit “to conduct horseraces, harness horse races, or dograces at a location within 100 miles of an existing pari-mutuel facility, or for jai alai within 50

[112 So.3d 162]

miles of an existing pari-mutuel facility.” § 550.054(2), Fla. Stat. (2010).

According to Barnes, only two locations exist in Florida where a new pari-mutuel facility can be located consistently with the mileage restriction of section 550.054(2). One such location is in an unspecified county in the Panhandle, and the other is in Dixie County. After acknowledging these locations, Barnes confirmed that a single new pari-mutuel facility in either location would not bring the county within the geographical requirements of section 550.054(14), because the county would need two section 550.054 permits to qualify and neither county has an existing facility. Ultimately, Barnes confirmed that no counties can come within the reach of section 550.054(14)(a) 1, because of either the buffer requirement of section 550.054(2) or “other factors such as being the only permit in the county.”

License Acquisitions urged the trial court to read subsections (a) and (b) of section 550.054(14) together to determine if the law can be applied to others in the future. License Acquisitions opined that the purpose of the law is to allow the relocation of facilities and operation of card rooms as provided in subsection (b). License Acquisitions contended that the statute applies to greyhound permits first and that the conversion provision exists simply to open the relocation and card-room provision to facilities with dormant jai-alai permits. According to License Acquisitions, if the relocation and card-room provision may be applied to other permitholders in the future, the entire act must be considered a general law. In addition to its primary argument urging the consideration of subsection (b), License Acquisitions theorized that the two-permit criterion of subsection (a)1 could apply to counties other than Palm Beach and Volusia in the future. License Acquisitions explained that a permitholder in a county with more than two...