State v. Division of Bond Finance of the Department of General Services
246 So.2d 102, 1971 Fla. LEXIS 3839 (1971)
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Rule of Law:
State bonds pledging the full faith and credit of the state may be issued without a statewide voter referendum if they are authorized by law and are for the specific purpose of financing the acquisition and construction of roads in a county, provided the project is approved by both the county's governing body and the state agency supervising the road system, as permitted by Article XII, Section 9(c) of the Florida Constitution.
Facts:
- The Division of Bond Finance proposed issuing $4,900,000.00 in State of Florida, Escambia County, bridge bonds dated November 1, 1970.
- The purpose of these bonds was to finance the construction of a new four-lane toll bridge and causeway across Santa Rosa Sound.
- The new bridge and causeway were intended to replace the existing two-lane Pensacola Beach Bridge and Causeway.
- The proposed plan of financing for the bonds involved securing them by (1) net tolls collected on the project, (2) eighty percent (80%) gasoline tax funds allocated to Escambia County, and (3) the full faith and credit of the State of Florida.
- The plan purported to pledge the full faith and credit of the State of Florida for these bonds.
Procedural Posture:
- The Division of Bond Finance of the Department of General Services of the State of Florida initiated proceedings for the validation of proposed State of Florida, Escambia County, bridge bonds.
- The Circuit Court of the Second Judicial Circuit entered a final judgment validating the proposed bonds.
- The case then came before the Supreme Court of Florida on appeal from that judgment.
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Issue:
Does Article XII, Section 9(c) of the Florida Constitution, in conjunction with statutory authorization, permit the issuance of state bonds pledging the full faith and credit of the state for road construction without a statewide voter referendum?
Opinions:
Majority - Boyd
Yes, the proceedings comply, and state bonds pledging the full faith and credit of the state for specific road construction, authorized by law, can be issued without a referendum under Article XII, Section 9(c) of the Florida Constitution. The Court affirmed the lower court's judgment, finding that Article XII, Section 9(c) was intended to provide an alternative method of financing state bonds without a referendum in particular instances. This includes bonds issued to finance the acquisition and construction of roads in a county, provided they are approved by the governing body of the county and the state agency supervising the state road system. The Court cited Florida Statutes § 215.60, F.S.A., which specifically authorizes the issuance of state bonds for road financing, primarily payable from Article XII, Section 9(c) revenues, and pledging the full faith and credit of the State, pursuant to the Constitution and the Act. Since the bond issue met these constitutional and statutory requirements, it was deemed valid despite pledging the State's full faith and credit without a referendum, as it fell under a specifically exempted purpose.
Dissenting - Roberts, C.J.
No, the bonds pledging the general credit of the state should not be issued without a statewide voter referendum. Chief Justice Roberts respectfully dissented, expressing concern that neither the Constitutional Revision Commission, the Legislature, nor the people of Florida intended to allow the general credit and overall taxing power of the state to be pledged so lightly, without the authorization of a statewide vote. He emphasized Florida's long-standing tradition of requiring a statewide vote for state bonds and a general pledge of credit, finding it difficult to accept that this fundamental principle was dispensed with in such a simple manner or assigned to a board not directly accountable to the electorate at large.
Analysis:
This case represents the Florida Supreme Court's first interpretation of Article XII, Section 9(c) of the revised Florida Constitution. It clarifies the conditions under which the state can issue bonds backed by its full faith and credit for road construction without a statewide voter referendum, thereby creating an important exception to the traditional requirement of public approval for state debt. The ruling provides a legal framework for expedited infrastructure financing in Florida but also highlights the ongoing tension between governmental efficiency and direct democratic accountability in public finance. Its impact is significant for future state and local government bond issues, particularly those related to transportation projects, by defining the scope of direct legislative and administrative authority in pledging the state's credit.
