Donnelly v. Marion County, 5D02-1851.

• Decision Date: 01 August 2003
• Docket Number: No. 5D02-1851.,5D02-1851.
• Citation: 851 So.2d 256
• Parties: Patrick DONNELLY and Leigh A. Donnelly, Appellants, v. MARION COUNTY, et al., Appellees.
• Court: Florida District Court of Appeals

851 So.2d 256

Patrick DONNELLY and Leigh A. Donnelly, Appellants, v. MARION COUNTY, et al., Appellees.

No. 5D02-1851.

District Court of Appeal of Florida, Fifth District.

August 1, 2003.

Richard Bennett and Lisa Bennett of Bennett & Bennett, Coral Gables, for Appellants.

Gordon B. Johnston, Marion County Attorney, Ocala, and Gregory T. Stewart, Harry F. Chiles and Virginia Saunders Delegal of Nabors, Giblin & Nickerson, P.A., Tallahassee, and Charles R. Forman of Forman, Hanratty & Montgomery, Ocala, for Appellees.

PLEUS, J.

This appeal concerns the legality of using special assessments to fund "enhanced law enforcement" and "community resource facilities" in an unincorporated area of Marion County.

Patrick Donnelly, individually and on behalf of others similarly situated, and Leigh Donnelly (the plaintiffs), appeal from an adverse final judgment validating the Marion County Marion Oaks Municipal Service Taxing Unit (MSTU).

The plaintiffs, representing a class of some 14,000 landowners, sued Marion County and the MSTU seeking a declaration that a special assessment levied by the MSTU for the purpose of funding, in the words of the ordinance creating the taxing unit, "law enforcement" and "community resource facilities," was unconstitutional. The plaintiffs alleged that the services funded by the special assessment provided no special benefit and had no logical relationship to the class members' real property. The complaint also challenged apportionment of the assessments.

The plaintiffs and approximately 14,000 class members are owners of unimproved property within the Marion Oaks development in Marion County subject to annual levy of non ad valorem special assessments fixed by the MSTU. The actual class was certified by the trial court consisting of all owners of unimproved real estate located within the boundaries of the Marion Oaks MSTU who are listed on the current tax roll. The plaintiffs' lots are located on paved roads but contain no structures.¹ The MSTU and Marion County are governed by the Marion County Board of County Commissioners.

Marion County had previously created a municipal service taxing unit which provides law enforcement services in the unincorporated area of the county funded by a special ad valorem tax. That service is provided to properties in the Marion Oaks MSTU. Enhanced law enforcement (greater patrols, creation of a sheriff's substation in Marion Oaks) is provided pursuant to the instant MSTU funded by the special assessment.

The assessments fund 160 hours per month of sheriff services in Marion Oaks. The assessments have also been used to construct and operate a 450-seat auditorium and a building containing recreational areas and rent-free space for a public library, a sheriff's substation and a neighborhood watch office. The grounds contain sports courts (basketball, tennis, shuffleboard) and a children's playground.²

This MSTU was created after a referendum election in 1988 when the voting residents of Marion Oaks approved enhanced law enforcement services and a community resource facility within Marion Oaks to be funded by special assessments on properties within the development.

Ordinance 88-37, in creating the Marion Oaks MSTU, does so under section 125.01(1)(q), Florida Statutes, "for the purpose of providing law enforcement and the construction, maintenance, and operation of community resource facilities...." The ordinance authorized the collection of special assessments beginning in 1989 at the following rates (the assessments continue to be imposed at the same rates):³

Improved Property $25 Partially Improved Property $20 Commercial Improved $25 Commercial Tracts $10 Greenbelt $ 5 The annual resolution of the Marion County Commission imposing the assessment contains no legislative finding of special benefit from 1990-96. Beginning in 1997, the annual resolution asserts that the services funded provide a special benefit to the properties assessed. No legislative finding of fair apportionment was included in any resolution until 2001.

The MSTU currently has six employees. The MSTU contracts annually with the Sheriff's Department to provide for patrols and investigative services at Marion Oaks for a total of 160 hours per month. The MSTU construction debt has been satisfied and the annual assessments now pay for operations and maintenance of the facilities and the sheriff's services and for reserves.

The plaintiffs moved for partial summary judgment claiming Ordinance 88-37 was unconstitutional under Florida law and that the assessments made pursuant to it were invalid as a matter of law. The defendants countered with their own motion for partial summary judgment.

The trial court denied the plaintiffs' motion and granted the defendants' motion, finding the ordinance to be valid, facially constitutional and constitutional as applied. The court declined to rule on the actual correctness of the assessments, finding that genuine issues of material fact existed which necessitated an evidentiary hearing.

At trial, the plaintiffs' expert, Dr. Nicholas, and the defendants' expert, Dr. Fishkind, testified on the issues of special benefit and fair apportionment of the special assessments. At the close of the plaintiffs' case, the court entered judgment for the defendants on the issue of special benefit. The court found that the assessments do not fund general government services but supplement such services. The court ruled that the special assessments provide a special benefit to the assessed properties by enhancing the value of the property and creating a community identity. At the close of the trial, the court ruled that the assessments were fairly and reasonably apportioned among the benefitted properties. A final judgment incorporating these rulings was entered.

In order for a special assessment to be valid and enforceable, it must be made pursuant to legislative authority and the method prescribed by the Legislature must be substantially followed. Madison County v. Foxx, 636 So.2d 39 (Fla. 1st DCA 1994). Further, a valid special assessment requires that the property assessed must derive a direct, special benefit from the service provided and that the assessment must be fairly and reasonably apportioned among properties that receive the special benefit. City of North Lauderdale v. SMM Props., Inc., 825 So.2d 343 (Fla.2002); Workman Enters., Inc. v. Hernando County, 790 So.2d 598 (Fla. 5th DCA 2001).

Counties are authorized by the Florida Constitution to levy ad valorem taxes on real property⁴ and are authorized by general law to impose special assessments and user fees. Collier County v. State, 733 So.2d 1012 (Fla.1999). The county, in enacting Ordinance 88-37, acted pursuant to section 125.01(1)(q), Florida Statutes, which provides in relevant part that counties have the power to:

Establish, and subsequently merge or abolish those created hereunder, municipal service taxing or benefit units for any part or all of the unincorporated area of the county, within which may be provided fire protection; law enforcement; beach erosion control; recreation service and facilities; water, alternative water supplies, including, but not limited to, reclaimed water and water from aquifer storage and recovery and desalination systems; streets; sidewalks; street lighting; garbage and trash collection and disposal; waste and sewage collection and disposal; drainage; transportation; indigent health care services; mental health care services; and other essential facilities and municipal services from funds derived from service charges, special assessments, or taxes within such unit only. Subject to the consent by ordinance of the governing body of the affected municipality given either annually or for a term of years, the boundaries of a municipal service taxing or benefit unit [MSTU; MSBU] may include all or part of the boundaries of a municipality. In ad valorem taxes are levied to provide essential facilities and municipal services within the unit, the millage levied on any parcel of property for municipal purposes by all municipal service taxing units and the municipality may not exceed 10 mills. This paragraph authorizes all counties to levy additional taxes, within the limits fixed for municipal purposes, within such municipal service taxing units under the authority of the second sentence of s. 9(b), Art. VII of the State Constitution.

The concept underlying MSTUs and MSBUs developed in the late 1960s as a way of avoiding taxation of real property within municipalities to finance services rendered by the county purely for the benefit of unincorporated areas. See Sarasota County v. Town of Longboat Key, 353 So.2d 569 (Fla. 2d DCA 1978),

quashed in part on other grounds, 375 So.2d 847 (Fla.1979). Section 125.01(1)(q), originally enacted in 1974, authorizes a county to provide "municipal services" and provides for a mechanism whereby only the recipient of the services pays for such services. By creation of municipal service taxing or benefit units within its unincorporated areas, the county can assess the full costs of the "municipal service" provided to that unit. Sarasota County, 353 So.2d at 570.

While the language in section 125.01(1)(q) contains an extensive list of municipal-type services and several funding alternatives, including "service charges, special assessment or taxes," this court has read this language as being descriptive and not necessarily "authorizing all listed services to be funded by all of the devices identified." Water Oak Mgmt. Corp. v. Lake County, 673 So.2d 135, 136 n. 3 (Fla. 5th DCA 1996), quashed in part, 695 So.2d 667 (Fla.1997). Nevertheless, case law has recognized that counties are authorized by section 125.01(1)(q) to levy special assessments to fund certain services provided through a MSTU or MSBU. See, e.g., Workman Enters., 790 So.2d at 598 (fire rescue services); Lake County, 673 So.2d at 136 (solid waste disposal and fire...