State v. Reedy Creek Improvement District
216 So. 2d 202 (1968)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A government project funded by public bonds that provides a significant benefit to a private entity is constitutional if the project's primary purpose serves a valid public interest, such as promoting tourism and recreation, and the benefit to the private entity is merely incidental to that public purpose.
Facts:
- The Florida Legislature enacted Chapter 67-764, establishing the Reedy Creek Improvement District (the District) across Orange and Osceola Counties.
- The enabling legislation granted the District's Board of Supervisors the power to undertake drainage and reclamation of wet and submerged lands within its territory.
- The Walt Disney World Company was the largest landowner within the newly formed District.
- The District's Board of Supervisors adopted a resolution to issue up to $12 million in drainage revenue bonds.
- The purpose of the bonds was to finance the cost of a drainage, reclamation, and water control project within a subdistrict.
- The stated goals of the project included improving sanitation, controlling pests, conserving natural resources, and fostering tourism and recreation.
Procedural Posture:
- Reedy Creek Improvement District filed a complaint in the Circuit Court for Osceola County, a court of first instance, seeking validation of two series of drainage revenue bonds.
- The State of Florida filed an answer opposing the validation.
- The Circuit Court entered a final judgment validating the bonds, finding they served a public purpose.
- The State of Florida, as appellant, directly appealed the Circuit Court's final judgment to the Supreme Court of Florida.
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 issuance of revenue bonds by a special improvement district, established to facilitate the development of land primarily owned by a private corporation, violate the Florida Constitution's prohibition against using public funds or credit for private purposes?
Opinions:
Majority - Ervin, J.
No. The issuance of revenue bonds does not violate the Florida Constitution because the project's primary purpose is public, and any benefit to private enterprise is incidental. The Legislature found that promoting tourism, recreation, and conservation of natural resources are valid public purposes, and such a finding should not be disturbed unless it is arbitrary. While the Walt Disney World Company will undoubtedly benefit from the improvements, the project is primarily directed toward developing tourism and recreation for the benefit of all citizens and visitors of the state. The project also provides public benefits like improved sanitation and pest control. Therefore, the significant benefit to a private enterprise does not invalidate the public purpose of the project.
Concurring - Drew, J.
I concur with the judgment affirming the validation of the revenue bonds for the reclamation and water control improvements. However, I believe these proceedings are limited in scope and do not require a full evaluation of all the broad and diverse powers granted to the District under its enabling act. The validity of those other powers is a question for another day.
Analysis:
This decision solidifies the legal framework for large-scale public-private partnerships in Florida by giving significant deference to legislative declarations of 'public purpose.' It establishes that a project's constitutionality hinges on its primary purpose, not on the magnitude of incidental benefits that may accrue to private entities. This ruling was instrumental in the development of Walt Disney World and set a precedent for using special improvement districts to finance infrastructure for major economic development projects, confirming that fostering tourism is a legitimate public purpose justifying public expenditure.
Unlock the full brief for State v. Reedy Creek Improvement District