Case Title: Panama City Community Redevelopment Agency v. State of Florida

Citation: 

Docket Number: 

State: florida

Court: Florida Supreme Court

Date: 2002-10-17T00:00:00Z

Document:
Supreme 
Court 
of 
Florida
____________
No. SC02-145
____________
PANAMA CITY BEACH COMMUNITY REDEVELOPMENT AGENCY,
Appellant,
vs.
STATE OF FLORIDA, et al.,
Appellees.
[October 17, 2002]
CORRECTED OPINION
LEWIS, J.
The Panama City Beach Community Redevelopment Agency entered this
appeal seeking review of a circuit court judgment denying validation of a proposed
bond issue.  We have jurisdiction under article V, section 3(b)(2) of the Florida
Constitution.
Facts and Procedural History
In 1998, the City of Panama City Beach (“City”) approached the St. Joe
Company (“St. Joe”) regarding possible plans to embark upon an aggressive
1.  As is the situation with many of Florida’s coastal communities, Panama
City Beach has developed in a linear fashion along the Gulf of Mexico, with Front
Beach Road serving as one of the City’s major east-west thoroughfares.  The other
primary east-west roadway is Back Beach Road (U.S. 98).
2.  This Memorandum of Understanding served as the foundational contract
between the two entities, detailing their relationship, proposed exchanges of land
and services, and various other covenants and obligations.  The agreement was
amended once, on October 13, 2000.
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redevelopment of the City’s parks and recreation facilities located near the center
point of the City’s major beachfront roadway, Front Beach Road.1  St. Joe owned
the real property which adjoined and separated portions of the City’s parcels.  In
essence, the City sought to consolidate a large land area under its ownership to join
and redevelop its land holdings in the area--the land commonly referred to as its
fairgrounds facility (Aaron Bessant Park), and athletic fields (Frank Brown Park).
As part of an ongoing redevelopment effort, the City formally entered into a
Memorandum of Understanding with St. Joe Company on March 10, 2000,2 and
moved to acquire a parcel of property adjacent to the fairgrounds owned by a third
party.  On November 30, 2000, the Panama City Beach City Council convened to
discuss and determine its goals with regard to the proposed redevelopment.  At this
meeting, the City’s assistant city manager, with the assistance of an attorney the
City retained as special counsel for the redevelopment effort, summarized the
problems and goals associated with the portion of the City that would become the
3.  The same five people composed the city council and the CRA board.
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Community Redevelopment Area.  Following a fairly extended discussion of the
City’s redevelopment plans, the council adopted Resolution 00-23, in which it
created the Community Redevelopment Agency (“CRA”), and legislatively
determined that the redevelopment area was “blighted” within the definition of
section 163.340(8), Florida Statutes (2000).
Subsequently, the CRA produced a Community Redevelopment Plan, which
was adopted by the city council and CRA3 in Resolution 01-09, as amended by
Resolution 01-43.  In January 2001, the City advertised for the disposition of
certain land interests within the redevelopment area held by the City, and for
proposals for the development of the area.  St. Joe was the only respondent, and its
plan to develop the land was approved.  In March 2001, the City held public
hearings and established a redevelopment trust fund for the redevelopment area
through enactment of Ordinance Number 717.
In September 2001, the City, the Pier Park Community Development District,
and the CRA entered into an interlocal agreement, denominated the Public
Improvement Partnership Agreement, for the purpose of developing the
redevelopment area in conformity with the redevelopment plan.  Among the
provisions of the agreement were sections calling for the issuance of revenue bonds
4.  The State Attorney did not contest the validity of the agreement and
bonds in its answer.  Indeed, throughout the trial court proceedings, as well as in its
filings with this Court, the State has asserted that the bonds and interlocal
agreement are valid. 
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by the district.  Pursuant to chapter 190, Florida Statutes (2000), the City, the
district, and the CRA sought validation of the partnership agreement, a decision on
the legality of each plaintiff entering into the agreement, and the issuance of the
bonds in the Circuit Court of the Fourteenth Judicial Circuit in Bay County.
Following the State Attorney’s answer and agreement with the plaintiffs in a
joint stipulation,4 the trial court scheduled an initial hearing and a subsequent
evidentiary hearing regarding the City’s findings of blight within the redevelopment
area.  Following the second hearing, the court issued its final judgment, in which it
validated the entirety of the interlocal agreement but declared invalid the revenue
bonds that the district planned to issue.  In its order, the trial court reasoned:
The Re-development Act was intended to provide for the
rehabilitation of previously built-upon properties that have outlived
their usefulness and are so economically impaired that no-one is
interested in rehabilitating them; the cost of leveling the property and
of putting in new infrastructure and buildings would be too much,
particularly in urban areas of decay.
. . . .
The law should not be at war with common sense.  The Court
has tried mightily to reconcile the stated purpose of the
Redevelopment Act with the facts before it.  But when the Court
places the evidence alongside the Act – and reads all of it – it is plain
that the District does not qualify for re-development.  It has never been
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developed!  By and large it is vacant land begging to be built on.
The Plaintiffs’ desire to extract a few words from the Act and
apply them to the District, irrespective of the obvious purpose of the
Act, leads to an absurdity.  The Redevelopment Act does not apply. 
The request for validation must be and is denied.
Pier Park Cmty. Dev. Dist. v. State, No. 03-2001-CA-3463-J (Fla. 14th Cir. Ct.
Dec. 7, 2001).  This timely appeal followed.
Analysis
The issue before us today is the appellant’s contention that the trial court
improperly substituted its judgment for that of the city council with regard to the
propriety of developing the redevelopment area.  The CRA asserts that in declaring
the City’s determination of blight to be unfounded and without justification, the trial
court ignored well-settled Florida law which holds that legislative findings by local
governments may be overturned only when they are determined to be clearly
erroneous.  In effect, the appellant argues, the trial court fixated upon the fact that
portions of the redevelopment area are undeveloped--a consideration entirely
beyond the scope of the trial court’s review in this bond validation proceeding--due
to an erroneous interpretation of the applicable statutes.  Therefore, it is asserted
that the trial court erred by independently examining the merits of the City’s
redevelopment plan.
It is clear that this Court’s review of the trial court’s conclusions of law is de
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novo.  See JFR Investment v. Delray Beach Cmty. Redevelopment Agency, 652
So. 2d 1261, 1262 (Fla. 4th DCA 1995).  Indeed, a concrete example of such de
novo review is this Court’s recent decision in Boschen v. City of Clearwater, 777
So. 2d 958 (Fla. 2001).  While the factual setting we analyzed in Boschen differs
from the instant case because “[a] final judgment validating bonds comes to this
Court with a presumption of correctness,” id. at 962, the comprehensive inquiry
performed by this Court in Boschen reveals that we thoroughly examined all of the
legal conclusions rendered by the trial court.  For example, this Court both
“determine[d] whether the evidence presented at the validation hearing supported
the trial court’s validation of the bonds,” and examined whether sufficient evidence
existed in the record to “demonstrate[] that the overall project promotes public
health and safety.”  Id. at 966, 968.
In stark contrast to this Court’s standard of review in validation proceedings,
the decisions of this Court also clearly mandate that trial courts must maintain a
very deferential standard of review when testing the validity of statutorily authorized
revenue bonds.  In Boschen, this Court stated:
Generally, “legislative declarations of public purpose are presumed
valid and should be considered correct unless patently erroneous.” 
Moreover, the wisdom or desirability of a bond issue is not a matter
for our consideration.  Indeed, we have recognized that so long as the
Legislature does not exceed its constitutional authority, our review of
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legislative declarations is limited.
777 So. 2d at 966 (citations omitted).  Additionally, “questions concerning the
financial and economic feasibility of a proposed plan are to be resolved at the
executive or administrative level and are beyond the scope of judicial review in a
validation proceeding.”  State v. City of Daytona Beach, 431 So. 2d 981, 983 (Fla.
1983).  Thus, only where the legislative determinations and conclusions are clearly
erroneous should a court refuse to validate the bond issue.
In its Final Judgment and Supplemental Final Judgment, the trial court made
clear that it fully validated the creation and powers of the Community
Redevelopment Agency and approved the interlocal agreement and redevelopment
plans.  The court only disapproved the issuance of bonds based upon its analysis
and conclusions regarding the impropriety of the City’s findings of “blight” within
the redevelopment area.  For this reason, this Court’s standard full inquiry into
whether (1) the public body has the authority to issue bonds, (2) the purpose of the
obligation is legal, and (3) the bond issuance complies with the requirements of the
law, see State v. Osceola County, 752 So. 2d 530, 533 (Fla. 1999); Poe v.
Hillsborough County, 695 So. 2d 672, 675 (Fla. 1997), is not necessary.  Because
the trial court narrowly defined its reason for refusing to validate the bond issuance,
we need only examine the first condition.
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Codified in chapter 163 of the Florida Statutes, the Community
Redevelopment Act of 1969 details the various measures which must be taken by
localities desiring to create redevelopment agencies, declare redevelopment areas,
and issue revenue bonds to finance projects within these areas.  Germane to the
instant case is section 163.385(1)(a), which states:
When authorized or approved by resolution or ordinance of the
governing body, a county, municipality, or community redevelopment
agency has the power in its corporate capacity, in its discretion, to
issue redevelopment revenue bonds from time to time to finance the
undertaking of any community redevelopment under this part . . . .
§163.385(1)(a), Fla. Stat. (2001).  “Community redevelopment” is defined as
including “undertakings, activities, or projects . . . in a community redevelopment
area for the elimination and prevention of the development or spread of slums and
blight.”  §163.340(9), Fla. Stat. (2001).  Finally, the Legislature defined “blighted
area” as either:
(a) An area in which there are a substantial number of slum,
deteriorated, or deteriorating structures and conditions that lead to
economic distress or endanger life or property by fire or other causes
or one or more of the following factors that substantially impairs or
arrests the sound growth of a county or municipality and is a menace
to the public health, safety, morals, or welfare in its present condition
and use:
1. Predominance of defective or inadequate street layout;
2. Faulty lot layout in relation to size, adequacy, accessibility or
usefulness;
3. Unsanitary or unsafe conditions;
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4. Deterioration of site or other improvements;
5. Inadequate and outdated building density patterns;
6. Tax or special assessment delinquency exceeding the fair
value of the land;
7. Inadequate transportation and parking facilities; and
8. Diversity of ownership or defective or unusual conditions of
title which prevent the free alienability of land within the deteriorated or
hazardous area; or
(b) An area in which there exists faulty or inadequate street
layout; inadequate parking facilities; or roadways, bridges, or public
transportation facilities incapable of handling the volume of traffic flow
into or through the area, either at present or following proposed
construction.
§163.340(8), Fla. Stat. (2001) (emphasis supplied).  Thus, as the trial court noted,
the CRA only has the authority to issue revenue bonds if the funds derived
therefrom are to be used to alleviate “blight.”
In City of Panama City Beach Resolution 00-23, the city council specifically
found:
Within the Redevelopment Area there exists faulty or inadequate
street layout; inadequate parking or parking facilities; or roadways or
other public transportation facilities incapable of handling the volume
of traffic flows into or through the area, either at present or following
substantial improvement within the area.  The Redevelopment Area
suffers from a predominance of defective or inadequate street layout,
aging infrastructure and design, and deterioration of site or other
improvements.
The City Council hereby finds that one or more slum or blighted
areas exist within the Redevelopment Area, and that the rehabilitation,
conservation, or redevelopment, or a combination thereof, of such
Redevelopment Area is necessary in the interest of the public health,
safety, morals, or welfare of the residents of the City.
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City of Panama City Beach Res. 00-23 (2000).  Under Florida case law, the trial
court should have simply examined these legislative findings to determine whether
they were “patently erroneous.”  See Boschen, 777 So. 2d at 966.  Indeed,
legislative determinations are entitled to a presumption of correctness and should be
upheld if supported by competent, substantial evidence in the record.  See City of
Winter Springs v. State, 776 So. 2d 255, 261-62 (Fla. 2001).  Thus, this Court
must examine the record to determine whether the City had a reasonable basis for
concluding that portions of the redevelopment area are blighted as that term has
been defined by our Legislature.  
It is not necessary that this Court detail the entirety of evidence contained in
the record which supports the City’s declaration of blight.  It is clear, however, that
a great quantity of information which supports the City’s conclusions in the instant
case was before this legislative body when it made its determinations.  Indeed, at
the city council session during which Resolution 00-23 was adopted, the City’s
attorney for the redevelopment project specifically informed the members of the
legislative determination they were required to make:
Important to looking at the redevelopment area – statutory scheme – is
this governing body’s determination that the redevelopment area is
subject to the terms “slum” or “blight.”  We’re not dealing with the
legal term “slum” here.  We’re really dealing with the term “blight” and
that goes to the lack of adequate infrastructure, the lack of a
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transportation system, the make up of parcels in a specific area that
are all conducive to a redevelopment initiative or exercise.  In a few
minutes I’m going to go over the findings necessary to determine
blight and I’m going to have a discussion with your Assistant
Manager, Mr. Pickle, that will serve as a form of testimony to
demonstrate record information that I would say you hold self evident
in this community.  It will be a description of the make up of this
parcel.  It’ll be a description of ownership.  It’ll be a description of
what exists and what doesn’t exist on the parcel today and that will
allow you to have a factual backdrop to ultimately consider a finding
contained in the resolution.
Subsequent to this introduction, the city council heard the testimony of Assistant
City Manager Dennis Pickle, who related the various transportation and
maintenance difficulties currently associated with the redevelopment area.  At a later
date, the City detailed the poor traffic and safety conditions within its community
redevelopment plan, which concluded by stating:
Together, fragmented ownership, poor traffic circulation, parking
constraints, and physical and economic degradation – a series of
interconnected conditions – have effectively created an environment of
blight within the Study Area.
The crux of that which transpired before the Panama City Beach City Council was
perhaps best summarized by Lee Sullivan, the city’s mayor, during the evidentiary
hearing before the trial court:
Well, I believe that [the redevelopment area] is a bad place, and
that it has problems, and I know what the problems are through my
experience.  And then I had an opportunity, as I said, as Mayor, and
listened to the process and had the explanation done about the
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statutory issues to understand, at least as I sat there, that it qualified to
meet the statutory definition.  So I, you know I, yes.  I believe that it
meets . . . I heard you explain the statutes time after time after time. 
I’ve heard that explanation so that I and the counsel [sic] clearly
understood that not only were the issues of finding [blight], but once
you had issues of finding you had to have a direct issue and how to
solve what you had found.
It is clear that when the city council adopted Resolution 00-23 finding that
the redevelopment area was blighted, the members had before them competent
evidence in support of this conclusion.  The council relied upon their own
knowledge of the area in question, the informed opinions of experts, and a
significant amount of testimonial evidence regarding the state of the redevelopment
area--particularly with regard to the roadways and concomitant safety issues--in
concluding that the area was blighted under section 163.340(8) of the Florida
Statutes.  As was the situation in City of Winter Springs v. State, a review of the
record “yields competent, substantial evidence to support the City’s
determination.”  776 So. 2d at 261.
Certainly, the evidence before the city council which revealed and outlined
the transportation, vagrancy, and sanitation problems within the redevelopment area
supports a finding of blight under section 163.340(8) of the Florida Statutes.  As
defined in this statutory section, a blighted area is properly found where a
“predominance of defective or inadequate street layout,” “unsanitary or unsafe
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conditions,” or “inadequate transportation and parking facilities” “substantially
impairs or arrests the sound growth of a county or municipality and is a menace to
the public health, safety, morals, or welfare.” § 163.340(8)(a), Fla. Stat. (2001). 
Additionally, section 163.340(8)(b) authorizes the finding of blight in "[a]n area in
which there exists faulty or inadequate street layout; inadequate parking facilities; or
roadways, bridges, or public transportation facilities incapable of handling the
volume of traffic flow into or through the area, either at present or following
proposed construction."  §163.340(8)(b), Fla. Stat. (2001) (emphasis supplied). 
Especially as related by Mayor Sullivan and the experts at the hearing before the
trial court, the evidence before the city council and the council’s explicit findings
fulfill the statutory requirements for blight set forth in either (a) or (b) of section
163.340(8).
The trial court’s conclusion that undeveloped land can never qualify as
blighted under chapter 163 is erroneous, because section 163.360(8) clearly
provides for the acquisition and redevelopment of “open land.”  See § 163.360(8),
Fla. Stat. (2001) (“If the community redevelopment area consists of an area of
open land to be acquired by the county or municipality . . . .”).  It is apparent that
the trial court viewed the applicable statutory provisions through a prism of
“redevelopment” with somewhat more restrictive parameters than those actually set
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forth by the Legislature.  While one may very logically reason, as did the trial court,
that the concept of “redevelopment” should have a direct nexus to that which has
previously been “developed,” the controlling statutory provisions are not so
limited.  Although the statutory scheme does, in part, contemplate action directed
toward prior development that has fallen into decay, the breadth of the statutory
scheme also specifically encompasses action that may be directed toward open
land.  The definition of “blighted area” under section 163.340(8)(a) seems to
contemplate some form of building development in the area, as it describes:  "An
area in which there are a substantial number of slum, deteriorated, or deteriorating
structures and conditions that lead to economic distress . . . ."  §163.340(8)(a), Fla.
Stat. (2001) (emphasis supplied).  However, section 163.340(8)(b) is not so
limiting, is separated in the context of the disjunctives “either” and “or,” and is
expansive without reference to the prior development with structures as it provides
a “blighted area” also means:  "An area in which there exists faulty or inadequate
street layout; inadequate parking facilities; or roadways, bridges, or public
transportation facilities incapable of handling the volume of traffic flow into or
through the area, either at present or following proposed construction."   
§163.340(8)(b), Fla. Stat. (2001).
Any doubt with regard to whether open or vacant land may be included
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within the area of redevelopment is resolved by consideration of section 163.360(8)
of the Florida Statutes, which clearly contemplates the inclusion of such land and
provides restrictions concerning its acquisition.  See § 163.360(8), Fla. Stat. (2001)
(providing separate and differing requirements for the acquisition of land,
depending upon the residential or nonresidential use for which the property will be
utilized).
In the face of basically unrefuted evidence detailing the information upon
which the city council based its conclusion that the redevelopment area is
“blighted,” the trial court concluded that “it is difficult to imagine that the evidence
before the City met any accepted definition of blight.”  Pier Park Cmty. Dev. Dist.
v. State, No. 03-2001-CA-3463-J (Fla. 14th Cir. Ct. Dec. 7, 2001).  However,
because the city council’s determination that the redevelopment area is blighted was
a legislative function, Florida law requires that this action “be sustained as long as
[it was] fairly debatable.”  Board of County Comm’rs of Brevard County v.
Snyder, 627 So. 2d 469, 474 (Fla. 1993); see also Pepin v. Div. of Bond Finance,
493 So. 2d 1013, 1014 (Fla. 1986) (holding that “legislative declarations of public
purpose are presumed valid and should be considered correct unless patently
erroneous”); State v. Housing Finance Auth. of Polk County, 376 So. 2d 1158,
1160 (Fla. 1979).  While the City Council cannot simply label an area “blighted”
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and make it so, see, e.g., City of Jacksonville v. Moman, 290 So. 2d 105, 107 (Fla.
1st DCA 1974) (“The city may designate an area as a slum, but such designation
does not make it a slum.”), the wealth of information before the city council and
knowledge possessed by its members certainly make the issue of blight “fairly
debatable.”  As discussed above, after examining competent, substantial evidence,
the city council properly determined that the subject property was within the
statutory definition of “blight.”  On this evidence, the city council’s conclusion that
the redevelopment area is blighted is not clearly or patently erroneous.
Here, the trial court did not give the city council’s legislative determinations
the proper deference mandated by well settled Florida law.  Indeed, the trial court’s
final judgment is strikingly similar to the determination this Court addressed in City
of Winter Springs: "By substituting its own judgment for that of the locally elected
officials, and thus failing to attach a presumption of correctness to the legislative
determination, the trial court erred as a matter of law."
776 So. 2d at 258.  The trial court failed to properly defer to the city council’s
findings under a correct statutory application; therefore, its judgment must be
reversed.
Conclusion
Based upon the foregoing, we reverse the final judgment of the trial court,
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and remand this cause for further bond validation proceedings consistent with this
opinion and settled Florida law regarding the proper deference to be given
municipal legislative findings.  As there was competent, substantial evidence before
the city council supporting its determination of blight, the trial court is directed to
validate the bond issue which is the subject of this action.
It is so ordered.
ANSTEAD, C.J., SHAW, WELLS, PARIENTE, and QUINCE, JJ., and
HARDING, Senior Justice, concur.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION, AND
IF FILED, DETERMINED.
An Appeal from the Circuit Court in and for Bay County - Bond Validations
   Glenn L. Hess - Judge - Case No. 03-2001-CA-3463-J
Randall W. Hanna, Mark G. Lawson, Michael S. Davis, and Kenneth A.
Guckenberger of Bryant, Miller and Olive, P.A., Tallahassee, Florida,
for Appellant
William A. Lewis, Assistant State Attorney, Panama City, Florida,
for Appellee
Jeffrey P. Whitton, Panama City, Florida,
for William Hendrick, Appellee/Intervenor