State v. City of Fort Pierce

• Decision Date: 18 November 1936
• Citation: 170 So. 742,126 Fla. 184
• Court: Florida Supreme Court
• Parties: STATE v. CITY OF FORT PIERCE.

170 So. 742

126 Fla. 184

STATE v. CITY OF FORT PIERCE.

Florida Supreme Court, Division A.

November 18, 1936

Proceeding by the City of Fort Pierce for the validation of revenue certificates of the city. From a decree for validation, the State of Florida appeals.

Affirmed. Appeal from Circuit Court, St. Lucie County Elwyn Thomas, judge.

COUNSEL

Angus Sumner, of Fort Pierce, for the State.

E. O Denison, of Fort Pierce, for appellee.

OPINION

BROWN Justice.

This appeal is taken from a final decree validating $170,000 of revenue certificates authorized by an ordinance of the City of Fort Pierce, for the payment of which the future net revenues of the city's electric light and water system were pledged. The proceeds of the certificates when sold are to be used in paying for needed extensions of the electric light plant.

The only new question presented by this record is whether the pledging of the net revenues of both plants--the waterworks plant as well as the electric plant--can be validly made without approval at an election held pursuant to article 9, § 6, of the Constitution (as amended in 1930) when the proceeds of the certificates are to be used for extending the facilities of the electric plant only. If the net revenues of the electric light system only had been pledged for the payment of the certificates to be used in extending that system, the decree of validation could clearly and readily be affirmed upon the authority of the cases heretofore decided by this court, which dispose of all questions here involved (except the one new question above referred to) favorably to the contentions of the appellee and the correctness of the decree of validation. See State v. City of Miami, 113 Fla. 280, 152 So. 6; State v. City of Daytona Beach, 118 Fla. 29, 158 So. 300; Board of County Commissioners v. Herrick (Fla.) 167 So. 386; Wilson v. City of Bartow (Fla.) 168 So. 545; State v. City of Clearwater (Fla.) 168 So. 546; State ex rel. City of Vero Beach v. MacConnell (Fla.) 169 So. 628; Williams v. Town of Dunnellon (Fla.) 169 So. 631; State v. Town of River Junction (Fla.) 169 So. 676.

The authorizing ordinance under which the certificates are to be issued expressly provided that, 'None of the foregoing covenants shall be construed as requiring the City to expend any funds other than the revenue derived from the operation of the electric light and water system,' and added in the next section (9) that: 'No taxes shall ever be levied and no moneys shall ever be taken or diverted from any funds of the City for the payment of the principal or interest on the certificates issued hereunder, except as hereinbefore expressly provided.' As there is no covenant 'hereinbefore expressly rpovided' pertaining to the levy of taxes, this paragraph is tantamount to an express covenant to renounce any right to ever resort to the taxing power of the city to enforce the payment of the revenue certificates, and to confine the security for such payment solely to the pledge of the net revenues of the electric light and water system, after payment of the costs of operation and maintenance, as thereinbefore provided for.

Recurring now to the question of whether the city could lawfully pledge the revenues of both the water and electric light plants as security for the payment of said certificates, we deem it appropriate to here quote several paragraphs from the well-considered opinion and decree of the circuit judge. Paragraphs 2 to 4 thereof, inclusive, read as follows:

'2. That, under and by virtue of chapter 19746, Laws of Florida, [Special] Acts of 1927, and other laws amendatory and supplementary thereto and the Constitution and general laws of the State of Florida, the City of Fort Pierce, a municipality in the County of St. Lucie, State of Florida, petitioner herein, was and is authorized and empowered to construct, own, operate and maintain an electric light and water system, to furnish the facilities of said electric light and water system to consumers thereof, and to fix and maintain rates and collect charges for such services and facilities; and that said City of Fort Pierce did construct an electric light and water system for said purpose and did finance such construction by the issuance of general obligation bonds of said City of Fort Pierce, for the payment of which bonds the said City of Fort Pierce was required by law to levy an ad valorem tax on all taxable property within the limits of said municipality.

'3. That said City of Fort Pierce now owns, operates and controls said electric light and water system, in its proprietary capacity; that said City of Fort Pierce has owned, operated and controlled said electric light and water system continuously during the last twenty-four (24) years; that although said system consists of an electric light plant and a water works, the said electric light and water system is operated, managed and maintained as a single system and in fact constitutes only one utility; that said electric light and water system comprises all the existing utility plants of said City of Fort Pierce; that said City of Fort Pierce has been and is deriving annual net revenues from said electric light and water system, and that the revenues so derived have not been pledged, in whole or in part, to the payment of any outstanding bonds or other obligations of said City of Fort Pierce, except that section 74 of chapter 12746, Laws of Florida, [Special] Acts of 1927 (same being the charter of said City), provides that the profits arising from the operation of the utility plants of the City, after payment of current interest and sinking fund requirements of the bonded indebtedness of such plants, may be placed in a reserve account...