Sebring Airport Auth. v. McIntyre
783 So. 2d 238 (2001)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
The legislature cannot by statute define a private, for-profit use of government property as a "public purpose" to create an ad valorem tax exemption where the Florida Constitution limits such exemptions to uses that are "governmental-governmental" in nature, not "governmental-proprietary."
Facts:
- The Sebring Airport Authority, a governmental entity, owns property in Highlands County, Florida.
- The Authority leases this property to Sebring International Raceway, Inc., a private, for-profit corporation.
- Sebring International Raceway, Inc. operates an automobile racetrack on the leased government property for profit.
- In addition to the racetrack, the lessee operates attendant commercial functions for profit, including food stands, drink stands, and souvenir shops.
- The racetrack facility is open to the general public upon payment of an admission charge.
Procedural Posture:
- Following a 1994 Florida Supreme Court decision denying a tax exemption to the same parties, the Florida Legislature amended section 196.012(6) to define uses like sports facilities as serving a public purpose.
- Sebring Airport Authority and Sebring International Raceway, Inc. (Appellants) subsequently sought an ad valorem tax exemption from the Highlands County Property Appraiser (Appellee).
- The trial court denied the exemption, ruling that the 1994 statutory amendment was unconstitutional.
- Appellants appealed to the Second District Court of Appeal, which affirmed the trial court's decision and held the statutory amendment unconstitutional.
- Appellants then appealed to the Supreme Court of Florida, which has jurisdiction because a district court declared a state statute unconstitutional.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the 1994 legislative amendment to section 196.012(6), Florida Statutes, which deems the use of government property by a private lessee as a sports facility to be a "public purpose," violate the Florida Constitution by creating an ad valorem tax exemption for a proprietary, for-profit enterprise?
Opinions:
Majority - Lewis, J.
Yes. The 1994 legislative amendment to section 196.012(6) violates the Florida Constitution because the Constitution, not the legislature, defines the scope of tax exemptions, and it does not permit exemptions for private, for-profit enterprises using government property for proprietary functions. The court distinguished the concept of "public purpose" used for bond validation cases from the stricter standard required for ad valorem tax exemptions under Article VII, section 3(a) of the Florida Constitution. For tax exemption purposes, the controlling test is whether the use of the property serves a "governmental-governmental" function, as opposed to a "governmental-proprietary" function. A proprietary function is a commercial, for-profit activity, even if it provides a public benefit, and operating a racetrack for profit is a classic example. The legislature cannot circumvent this constitutional limitation by simply passing a statute that "deems" a proprietary function to be a public one, as the constitution is supreme over legislative enactments.
Analysis:
This decision reaffirms the strict, constitutionally-derived distinction between governmental and proprietary functions for ad valorem tax exemption purposes in Florida. It serves as a significant check on legislative power, establishing that lawmakers cannot use statutory redefinitions to create tax exemptions that the constitution itself does not authorize. The case solidifies the "governmental-governmental" test as a constitutional requirement, preventing private, for-profit entities from gaining tax-exempt status simply by leasing government land for commercial activities like sports stadiums or arenas. This precedent makes it significantly more difficult for public-private partnerships involving for-profit ventures on public land to avoid property taxation.
Unlock the full brief for Sebring Airport Auth. v. McIntyre