Strand v. Escambia County
| Decision Date | 18 September 2008 |
| Docket Number | No. SC06-1894.,SC06-1894. |
| Citation | 992 So.2d 150 |
| Parties | Dr. Gregory L. STRAND, Appellant, v. ESCAMBIA COUNTY, Florida, etc., et al., Appellees. |
| Court | Florida Supreme Court |
David A. Theriaque, S. Brent Spain, and Timothy E. Dennis of Theriaque, Vorbeck and Spain, Tallahassee, Florida, and Kerry Ann Schultz of Bordelon and Schultz Law Firm, P.L., Gulf Breeze, FL, for Appellant.
Richard Lott of Lott and Associates, P.L., Gulf Breeze, Florida, Patricia Lott of Miller, Canfield, Paddock, and Stone, P.L.C., Pensacola, Florida, and Elaine Johnson James of Edwards, Angell, Palmer, and Dodge, LLP, West Palm Beach Florida, for Appellees.
David G. Tucker and Robert L. Nabors of Nabors, Giblin and Nickerson, P.A., Tallahassee, Florida, and Major B. Harding of Ausley and McMullen, P.A., Tallahassee, Florida, on behalf of Florida Association of Counties and Florida School Boards Association, Inc.; Randall W. Hanna of Bryant, Miller, and Olive, P.A., Tallahassee, Florida, and Harry Morrison, Jr., Tallahassee, Florida, on behalf of the Florida League of Cities, Inc.; Stephen H. Grimes of Holland and Knight, LLP, Tallahassee, Florida, and David E. Cardwell of The Cardwell Law Firm, Orlando, Florida, on behalf of the Florida Redevelopment Association, Inc.; and Scott D. Makar, Solicitor General, Craig D. Feiser, and Charles B. Upton, II, Deputy Solicitors General, Tallahassee, Florida, on behalf of Attorney General Bill McCollum, as Amici Curiae.
We have before us an appeal from a final judgment validating a proposed bond issue from the Circuit Court of the First Judicial Circuit, in and for Escambia County, Florida. We have jurisdiction. See art. V, § 3(b)(2), Fla. Const. Upon consideration of appellee Escambia County's motion for rehearing, we withdraw our revised opinion, filed on September 28, 2007, and substitute the following opinion. We affirm the circuit court's final judgment.
On May 4, 2006, Escambia County (County) adopted Ordinance 2006-38 (Ordinance). The Ordinance establishes the Southwest Escambia Improvement District (District) in the southwest portion of the County, running to the peninsula known as Perdido Key. The Ordinance also establishes the Southwest Escambia Improvement Trust Fund (Trust Fund), which will be used to finance or refinance infrastructure improvements in the District, and authorizes the use of tax increment financing to fund the Trust Fund. In conjunction with the adoption of the Ordinance, the County adopted Resolution R2006-96 (Resolution) on May 4, 2006, authorizing the County to issue bonds not exceeding $135,000,000 for the District. The stated purpose of these bonds is to finance a four-lane road-widening project in the District to improve economic development within that area and alleviate traffic congestion. The bonds are to reach maturity no later than the thirty-fifth year after revenues are first deposited into the Trust Fund.
The Ordinance provides that the bonds are to be "payable out of revenues pledged to and received by the County and deposited to its Southwest Escambia Improvement Trust Fund." Ordinance § 4(4). The Ordinance requires the County to appropriate to the Trust Fund by February 1 of each year an amount equal to the "Tax Increment"1 so long as any applicable indebtedness is outstanding. Id. § 4(1)-(3). The funds equaling the Tax Increment that are placed into the trust are known as "Tax Increment Revenues." Id. § 2.
The Resolution employs the term "Trust Fund Revenues," which are the moneys other than "Supplemental Revenues"2 deposited in the Trust Fund pursuant to the provisions of the Ordinance. Resolution art. I, § 101 (May 4, 2006). The Resolution provides that the bonds shall be repaid from "Pledged Funds,"3 which are the funds deposited in the Trust Fund including the Trust Fund Revenues and the Supplemental Revenues. Id. art. III, § 301. The Resolution does require that if necessary, the County shall appropriate in its annual budget non-ad valorem revenues if available as Supplemental Revenues sufficient to secure the indebtedness in each fiscal year. However, the Resolution expressly states that the County does not covenant to maintain any services or programs now provided which generate non-ad valorem tax revenues. Id. § 304(m).
The Ordinance and the Resolution dictate that the bonds do not pledge the full faith and credit or taxing power of the County, the State, or any political divisions thereof. Section 4 of the Ordinance states as follows:
(4) The revenue Bonds and notes of every issue under this part are payable out of revenues pledged to and received by the County and deposited to its Southwest Escambia Improvement Trust Fund. The lien created by such bonds, notes or other forms of indebtedness shall not attach until the revenues referred to herein are deposited in the Southwest Escambia Improvement Trust Fund at the times, and to the extent that, such Tax Increment Revenues accrue. The holders of such bonds, notes or other forms of indebtedness have no right to require the imposition of any tax or the establishment of any rate of taxation in order to obtain the amounts necessary to pay and retire such bonds, notes or other forms of indebtedness.
(5) Revenue Bonds issued under the provisions of this part shall not be deemed to constitute ... a pledge of the faith and credit of the County or the state or any political subdivision thereof, but shall be payable solely from the revenues provided therefor.
Ordinance § 4(4)-(5). Section 103(i) of the Resolution reiterates that the bonds are payable solely from the Pledged Funds and "shall not constitute an indebtedness, liability, general or moral obligation, or a pledge of the faith, credit or taxing power of the Issuer, the State, or any political subdivision thereof." Section 301 adds that no bondholder
shall ever have the right to compel the exercise of the ad valorem taxing power of the Issuer, the State or any political subdivision thereof, or taxation in any form of any real or personal property therein, or the application of any funds of the Issuer, the State or any political subdivision thereof ... other than the Pledged Funds as provided in this Resolution.
Section 302 explains that the bonds "shall not constitute a lien upon any property owned by or situated within the corporate territory of the Issuer, but shall constitute a lien only on the Pledged Funds." Accordingly, no lien created by the bonds shall attach until the revenues are deposited in the Trust Fund. Finally, the Resolution includes a finding that "[t]he estimated Pledged Funds will be sufficient to pay all principal of and interest on the [bonds]." Resolution art. I, § 103(h).
On May 16, 2006, the County filed a complaint for validation in the Escambia County Circuit Court, seeking validation of the bond issuance. The state attorney promptly filed his answer, and Dr. Gregory Strand intervened pursuant to section 75.07, Florida Statutes (2006). Dr. Strand argued that the bond issuance was distinguishable from the bond issuance approved by this Court in State v. Miami Beach Redevelopment Agency, 392 So.2d 875 (Fla. 1980), and therefore required a referendum pursuant to the requirement of article VII, section 12 of the Florida Constitution.4
On August 18, 2006, the circuit court entered the final judgment validating the bond issuance. The circuit court concluded that the County had the authority to issue the bonds and that the bonds were not subject to referendum pursuant to article VII, section 12. The circuit court cited to our decisions in Miami Beach and Penn v. Florida Defense Finance & Accounting Service Center Authority, 623 So.2d 459 (Fla.1993). Dr. Strand, the intervenor, appeals that final judgment.
In City of Gainesville v. State, 863 So.2d 138, 143 (Fla.2003), this Court explained the scope of a bond validation proceeding as follows:
We have previously explained the scope of a bond validation proceeding: "[C]ourts should: (1) determine if a public body has the authority to issue the subject bonds; (2) determine if the purpose of the obligation is legal; and (3) ensure that the authorization of the obligation complies with the requirements of law." State v. City of Port Orange, 650 So.2d 1, 2 (Fla.1994).
This Court reviews the "trial court's findings of fact for substantial competent evidence and its conclusions of law de novo." Id. (citing Panama City Beach Cmty. Redev. Agency v. State, 831 So.2d 662, 665 (Fla.2002); City of Boca Raton v. State, 595 So.2d 25, 31 (Fla.1992)). The final judgment of validation comes to this Court clothed with a presumption of correctness. Wohl v. State, 480 So.2d 639, 641 (Fla. 1985).
Dr. Strand raises three issues in his appeal: (A) whether the circuit court abused its discretion in denying his motion for continuance; (B) whether the circuit court's final judgment is supported by competent, substantial evidence; and (C) whether the bonds required a referendum pursuant to the requirement of article VII, section 12 of the Florida Constitution.
On June 29, 2006, the day before the bond validation hearing, Dr. Strand filed a motion for a thirty-day continuance, asserting that his counsel did not learn of the bond validation hearing until June 27, 2006. A continuance is within the discretion of the trial judge and will not be reversed absent a clear showing of abuse. See Perlow v. Berg-Perlow, 875 So.2d 383, 387 (Fla.2004); Lebron v. State, 799 So.2d 997, 1018 (Fla.2001). We find that the circuit court did not abuse its discretion in denying Dr. Strand's motion for a continuance.
Section 75.06, Florida Statutes (2006), provides that notice of a bond validation hearing shall be effectuated by publishing notice in a newspaper published in the territory to be affected by the issuance of the bonds for two consecutive weeks, commencing not less than twenty days before the...
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