Title: Advisory Opinion to the Attorney Re: Fairness Initiative Requiring Legislative Determination That Sales Tax Exemptions and Exclusions Serve a Public Purpose

State: florida

Issuer: Florida Supreme Court

Document:

1.  This Court's review responsibilities are mandatory but narrow and are
completely unrelated to the merits of the proposed amendment.  Rather, we are
mandated to determine whether the amendment addresses a single subject and
whether the ballot title and summary for the amendment is adequate to properly
Supreme 
Court 
of 
Florida
____________
No. SC04-947
____________
ADVISORY OPINION TO THE ATTORNEY GENERAL
RE: FAIRNESS INITIATIVE REQUIRING LEGISLATIVE
DETERMINATION THAT SALES TAX EXEMPTIONS AND
EXCLUSIONS SERVE A PUBLIC PURPOSE
[July 15, 2004]
PER CURIAM.
The Attorney General has requested this Court to review a proposed
amendment to the Florida Constitution.  We have jurisdiction.  See art. IV, § 10;
art. V, § 3(b)(10), Fla. Const.  For the reasons expressed below, we hold the
proposed amendment violates article XI, section 3, Florida Constitution, and
section 101.161, Florida Statutes (2003).1
inform the voter.
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I.  PROCEEDINGS TO DATE
Floridians Against Inequities in Rates ("FAIR"), a political committee
registered pursuant to section 106.03, Florida Statutes (2003), has invoked the
petition process of article XI, section 3, Florida Constitution, to propose a
constitutional amendment through citizen initiative.  The amendment would direct
the Legislature to perform an open review of exemptions from and exclusions to
the state's sales tax.  The full text of the proposed amendment states:
BE IT ENACTED BY THE PEOPLE OF FLORIDA THAT:
ARTICLE III of the Florida Constitution is hereby amended to add
the following as Section 20:   
Legislative review and enactment of exemptions and exclusions from
the sales tax.--
(a)  FAIRNESS INITIATIVE.  Except for the current exemptions
provided for: food; prescription drugs; health services; and residential
rent, electricity and heating fuel, which secure tax fairness, the
Legislature shall, prior to July 1, 2007, and prior to the first day of July
for each tenth year thereafter, review all exemptions and services or
transactions excluded from the sales tax existing on or created
subsequent to the effective date of this amendment.  The Legislature
shall reenact only those exemptions or adopt and continue only those
exclusions that advance or serve the public purpose of: encouraging
economic development and competitiveness; supporting educational,
governmental, literary, scientific, religious, or charitable initiatives or
institutions; or securing tax fairness.  All exemptions or exclusions that
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are not reenacted or adopted and continued by the adoption of a law
in conformity with the enactment requirements provided in this section
shall be eliminated effective January 1 subsequent to the July 1
deadline established in this section for the review of all exemptions and
exclusions.  Each law creating or reenacting a sales tax exemption or
creating or continuing an exclusion shall require approval by
three-fifths vote of the membership of each house of the Legislature,
shall contain the single subject-matter of a single exemption or a single
exclusion and shall contain a factual determination that each exemption
or exclusion advances or serves a public purpose as enumerated in
this section.
(b)  CONSTRUCTION.  For purpose of this section:
(1)  The term sales tax shall mean the tax on sales, use and other
transactions levied by the state or authorized to be levied by a local
government in chapter 212, Florida Statutes, as of January 1, 2003,
except that the term sales tax shall not include the convention
development tax, the local option food and beverage tax or the rental
car surcharge provided in sections 212.0305, 212.0306, or 212.0606,
Florida Statutes, or the taxation of: the sales of tangible personal
property purchased for resale or imported, produced, or manufactured
in this state for export; sales of real property; sales of intangible
personal property; payment of employee salaries and benefits; or
transactions subject to the communications services tax imposed in
chapter 202, Florida Statutes.
(2)  The term "exclusion" and the phrase "a service or transaction
excluded from the sales tax" shall mean a sale or use of tangible
personal property or the rendering of services for consideration that is
not subject to the sales tax and not specifically exempted on the
effective date of this amendment.
(3)  To satisfy the enactment limitation of this section that each law
shall contain only the single subject-matter of a single exclusion, each
law adopting or continuing an exclusion from the sales tax shall
include or reference the sale or use or the rendering of a service by a
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business, industry or profession with at least the same first four digits
in its NAICS code number as described by the North American
Classification System code published by the United States Census
Bureau, or its successor in function.
The ballot title for the proposed amendment is "Fairness Initiative Requiring
Legislative Determination that Sales Tax Exemptions and Exclusions Serve A
Public Purpose."  The summary for the proposed amendment states:
The Legislature shall periodically review sales tax exemptions or
excluded services and transactions except:  food; prescription drugs;
health services; and residential rent, electricity, and heating fuel; and
shall continue or create only exemptions or exclusions serving a
defined public purpose.  Each law shall contain the single subject of a
single exemption or exclusion and be approved by three-fifths vote of
each legislative house.  Exemptions and exclusions not reenacted or
adopted by the Legislature are eliminated.
The Florida Secretary of State submitted the amendment to the Florida Attorney
General, pursuant to section 15.21, Florida Statutes (2003).  
In accordance with the provisions of article IV, section 10, Florida
Constitution, and section 16.061, Florida Statutes (2003), the Attorney General has
petitioned this Court for an advisory opinion as to whether the text of the proposed
amendment complies with article XI, section 3, Florida Constitution, and whether
the proposed ballot title and summary comply with section 101.161, Florida
Statutes (2003).  FAIR has filed a brief in favor of the proposed amendment, and a
number of interested parties have filed a joint brief opposing the placement of the
2.  The parties appearing in opposition include: (1) Florida Association of
Realtors, Inc., a not-for-profit Florida corporation made up of professionals in the
Florida real estate industry; (2) Florida Institute of Certified Public Accountants and
Florida Institute of Accountants, Inc., a not-for-profit Florida corporation that has
members who are certified public accountants licensed to perform professional
accounting services in Florida; (3) National Federation of Independent Businesses,
Inc., a California not-for-profit corporation that represents members located and
doing business in Florida; (4) Florida Phosphate Council, Inc., a not-for-profit
Florida corporation that is a trade association that represents five member
companies in statewide governmental relations and public affairs; (5) Florida
Cattlemen's Association, Inc., a not-for-profit Florida corporation that represents
members who are in the cattle and ranching business; (6) Florida Farm Bureau
Federation, Inc., a not-for-profit Florida corporation representing commercial
farmers and their families; (7) Florida Manufacturing and Chemical Council, Inc., a
not-for-profit Florida corporation representing approximately fifty businesses in the
manufacturing and associated industries; (8) Florida Fruit and Vegetable
Association, Inc., a not-for-profit Florida corporation that is a trade association
that aims to enhance the fruit and vegetable business; and (9) Sunshine State Milk
Producers, Inc., a Florida not-for-profit corporation that represents dairy farms
throughout the southeastern United States.
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amendment on the ballot.2
II.  THIS COURT'S INQUIRY
When the Court is mandated to render an advisory opinion concerning a
proposed constitutional amendment arising through the citizen initiative process, the
Court must limit its inquiry to two issues: (1) whether the amendment violates the
single-subject requirement of article XI, section 3, Florida Constitution, and (2)
whether the ballot title and summary violate the requirements of section 101.161(1),
Florida Statutes (2003).  See, e.g., Advisory Op. to Att'y Gen. re Amendment to
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Bar Gov't From Treating People Differently Based on Race in Pub. Educ., 778 So.
2d 888, 890-91 (Fla. 2000).  
In addressing these two issues, our inquiry is governed by several general
principles.  First, we do not consider or address the merits or wisdom of the
proposed amendment.  See, e.g., Amendment to Bar Gov't From Treating People
Differently Based on Race in Pub. Educ., 778 So. 2d at 891.  Second, "[t]he Court
must act with extreme care, caution, and restraint before it removes a constitutional
amendment from the vote of the people."  Askew v. Firestone, 421 So. 2d 151, 156
(Fla. 1982).  Specifically, where citizen initiatives are concerned, "[the] Court has
no authority to inject itself in the process, unless the laws governing the process
have been 'clearly and conclusively' violated."  Advisory Op. to Att'y Gen. re Right
to Treatment and Rehabilitation for Non-Violent Drug Offenses, 818 So. 2d 491,
498-99 (Fla. 2002); see also Amendment to Bar Gov't From Treating From
Treating People Differently Based on Race in Pub. Educ., 778 So. 2d at 891 ("In
order for the Court to invalidate a proposed amendment, the record must show that
the proposal is clearly and conclusively defective . . . .").  Hence, our review is
narrow and limited to the two questions set out above.
III.  THE SINGLE-SUBJECT RULE
Article XI, section 3, Florida Constitution, sets forth the requirements for a
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proposed constitutional amendment arising via the citizen initiative process.  This
section contains the single-subject rule:
SECTION 3.  Initiative.—The power to propose the revision or
amendment of any portion or portions of this constitution by initiative
is reserved to the people, provided that, any such revision or
amendment, except for those limiting the power of government to raise
revenue, shall embrace but one subject and matter directly connected
therewith.
Art. XI, § 3, Fla. Const. (emphasis added).  The single-subject requirement is a
"rule of restraint" that was "placed in the constitution by the people to allow the
citizens, by initiative petition, to propose and vote on singular changes in the
functions of our governmental structure."  Advisory Op. to Att'y Gen. re
Prohibiting Public Funding of Political Candidates' Campaigns, 693 So. 2d 972,
975 (Fla. 1997) (quoting Fine v. Firestone, 448 So. 2d 984, 988 (Fla. 1984)).
Specifically, the single-subject rule prevents an amendment from engaging in either
of two practices: (a) logrolling, or (b) substantially altering or performing the
functions of multiple branches of state government.
The single-subject rule prevents logrolling, "a practice wherein several
separate issues are rolled into a single initiative in order to aggregate votes or secure
approval of an otherwise unpopular issue."  See In re Advisory Op. to Att'y
Gen.—Save Our Everglades, 636 So. 2d 1336, 1339 (Fla. 1994); see also Advisory
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Op. to Att'y Gen. re Limited Casinos, 644 So. 2d 71, 73 (Fla. 1994) ("A primary
purpose for the single-subject restriction is to prevent 'logrolling,' a practice
whereby an amendment is proposed which contains unrelated provisions, some of
which electors might wish to support, in order to get an otherwise disfavored
provision passed."); Fine, 448 So. 2d at 993 ("The purpose of the single-subject
requirement is to . . . avoid voters having to accept part of a proposal which they
oppose in order to obtain a change which they support.").  In addressing this issue,
the Court utilizes a "oneness of purpose" standard.  See Fine, 448 So. 2d at 990
("[T]he one-subject limitation deal[s] with a logical and natural oneness of purpose
. . . .").  A proposed amendment meets this test when it "may be logically viewed
as having a natural relation and connection as component parts or aspects of a
single dominant plan or scheme.  Unity of object and plan is the universal test . . . ." 
Id. (quoting City of Coral Gables v. Gray, 19 So. 2d 318, 320 (Fla. 1944)).
Although FAIR argues that the proposed amendment deals with the single-
subject of sales tax, in reality, the initiative before the Court for review contains
three disparate subjects: (1) a scheme for the Legislature to review existing
exemptions to the sales tax under chapter 212; (2) the creation of a sales tax on
services that currently does not exist; and (3) limitations on the Legislature's ability
to create or continue exemptions and exclusions from the sales tax.
3.  Chapter 212 does address sales tax on certain specifically delineated
services.  See, e.g., §§ 212.05(1)(i), Fla. Stat. (2003) (providing for tax on
detective, burglar protection, and other protection services and pest control
services); 212.0606, Fla. Stat. (2003) (providing a daily surcharge on rental car
services); 212.08(7)(v), Fla. Stat. (2003) (exempting "professional services" from
sales tax).  However, other than these very limited exceptions, services generally are
not within the scope of the sales and use tax provided for in chapter 212.
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The first of these three subjects creates a scheme for review of legislative
exemptions to the sales tax in chapter 212, Florida Statutes.  Chapter 212 generally
imposes the sales and use tax on goods, but also includes enumerated exemptions
for goods that are not to be taxed.3  The proposed amendment would create a
scheme by which the Legislature would review these exemptions listed in chapter
212 and determine which exemptions should be continued because they serve the
public purpose of (1) encouraging economic development and competitiveness; (2)
supporting educational, governmental, literary, scientific, religious, or charitable
initiatives or institutions; or (3) securing tax fairness.  If the Legislature does not
reenact the exemption, the exemption expires.
Separate from the review of exemptions in chapter 212, the proposed
amendment also requires the Legislature to examine "exclusions" from the sales tax. 
Section (b)(1) of the proposed amendment specifically defines exclusions on
services and transactions from the sales tax as meaning "a sale or use of tangible
personal property or the rendering of services for consideration that is not subject
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to the sales tax and not specifically exempted on the effective date of this
amendment." (Emphasis added.)  Therefore, unlike the specific exemptions in
chapter 212, exclusions are not enumerated or expressly listed in the statutes.   The
Legislature would ostensibly have to anticipate and identify what services and
transactions are currently excluded from the sales tax.  If the Legislature failed to
anticipate or identify a particular transaction or service and specifically exclude it
from being taxed, the result would be appear to be a tax on such service created by
the Legislature's inaction.  Hence, we must agree with the assertion that, by its
operation, the proposed amendment would create a sales tax on services that
currently does not exist.
Finally, the proposed amendment also limits the Legislature's authority to
pass exemptions or exclusions to the sales tax by requiring the Legislature to
enunciate a public purpose within a set of defined criteria.  Moreover, the
Legislature is required to pass each law creating or reenacting a sales tax exemption
or creating or continuing an exclusion by a three-fifths vote of the membership of
each house of the Legislature.
While all of these three goals arguably relate to sales taxes, and any one of
these three goals might be the permissible subject of a constitutional amendment
under the initiative process, we conclude that together they constitute impermissible
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logrolling and violate the single-subject requirement of article XI, section 3, of the
Florida Constitution because of the substantial, yet disparate, impact they may
have.  A voter may support requiring the Legislature to periodically review tax
exemptions on the sale of certain goods, but oppose the actual creation of a broad
sales tax on undefined services that are currently excluded from the sales tax.  This
initiative requires the voter to "choose all or nothing" among the three apparent
effects of the amendment.  Save Our Everglades, 636 So. 2d at 1341.  This case is
similar to others where we have concluded that a proposed amendment engages in
impermissible logrolling.  See, e.g., Advisory Opinion to the Attorney General re
Tax Limitation, 644 So. 2d 486, 491 (Fla. 1994) (concluding that proposed
amendment violated the single-subject requirement because it combined the
subjects of taxes and fees); Save Our Everglades, 636 So. 2d at 1341 (holding that
initiative's dual objectives, i.e., to restore the Everglades and to compel the sugar
industry to fund the restoration, constituted impermissible logrolling); Advisory
Opinion to the Attorney General re Right of Citizens to Choose Health Care
Providers, 705 So. 2d 563 (Fla. 1998) (holding that proposed amendment was
"flawed in many respects" and violated single-subject requirement by banning
limitations on health care provider choices and prohibiting private parties from
entering into contracts that would limit health care provider choice).  
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IV.  BALLOT TITLE AND SUMMARY
Section 101.161, Florida Statutes (2003), sets forth the requirements for the
ballot title and summary of a proposed constitutional amendment and provides in
relevant part:
[T]he substance of the amendment or other public measure shall be an
explanatory statement, not exceeding 75 words in length, of the chief
purpose of the measure. . . .  The ballot title shall consist of a caption,
not exceeding 15 words in length, by which the measure is commonly
referred to or spoken of.
§ 101.161(1), Fla. Stat. (2003).  The basic purpose of this provision is "to provide
fair notice of the content of the proposed amendment so that the voter will not be
misled as to its purpose, and can cast an intelligent and informed ballot."  See
Advisory Op. to Att'y Gen. re Fee On Everglades Sugar Prod., 681 So. 2d 1124,
1127 (Fla. 1996).
In conducting its inquiry into the validity of a proposed amendment under
section 101.161(1), the Court asks two questions.  First, the Court asks whether
"the ballot title and summary . . . fairly inform the voter of the chief purpose of the
amendment."  Right to Treatment and Rehabilitation for Non-Violent Drug
Offenses, 818 So. 2d at 497.  Second, the Court asks "whether the language of the
title and summary, as written, misleads the public."  Advisory Op. to Att'y Gen. re
Right of Citizens to Choose Health Care Providers, 705 So. 2d 563, 566 (Fla.
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1998).
Because we have concluded that the proposed amendment violates the
single-subject rule, we need not discuss all the opponents' challenges to the ballot
summary and title.  Nevertheless, as noted above, the proposed amendment
operates in a way that could essentially create a tax on services if the Legislature
fails to enact specific exclusions for all possible services.  We conclude that a voter
must be directly informed of such an important consequence, and that this
summary fails to do so.  Therefore, we conclude that the ballot summary is
deficient because it does not inform the voter that the amendment can operate in a
way that would create such a tax by the passage of the amendment.
V.  CONCLUSION
We recognize the need of this Court to "act with extreme care, caution, and
restraint before it removes a constitutional amendment from the vote of the people." 
Askew v. Firestone, 421 So. 2d at 156.  However, our review would be
meaningless if we failed to act when presented with a proposed amendment that is
clearly and conclusively defective.  Accordingly, we hold that the proposed
amendment fails to comply with the legal requirements of article XI, section 3 of the
4.  Pursuant to article XI, section 5(b) of the Florida Constitution, the
Legislature recently enacted legislation requiring this Court's review of  financial
statements as to the estimated increase or decrease in any revenues or costs to state
or local governments resulting from  proposed initiatives.  See ch. 2004-33, Laws
of Fla.  Because we are holding that the proposed amendment should be stricken
for failure to comply with the single-subject  requirement of article XI, section 3 of
the Florida Constitution and with the ballot title and summary requirements of
section 101.161, Florida Statutes (2003), we need not conduct the separate review
process contemplated by the new legislation for this proposed amendment.
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Florida Constitution and section 101.161, Florida Statutes (2003).4
It is so ordered.
No petition for rehearing will be entertained by the Court.
PARIENTE, C.J., and WELLS, QUINCE, CANTERO, and BELL. JJ., concur.
ANSTEAD and LEWIS, JJ., concur in result only.
NO MOTION FOR REHEARING WILL BE ALLOWED.
Original Proceeding - Advisory Opinion to the Attorney General
Charles J. Crist, Jr., Attorney General, Tallahassee, Florida,
for Petitioner
Senator John McKay, Chair, Tallahassee, Florida; and Thomas R. Julin and Talbot
D'Alemberte, Tallahassee, Florida,
for Floridians Against Inequities in Rates, Proponents
Cynthia S. Tunnicliff, Howard E. Adams, and Kimberly L. King of Pennington,
Moore, Wilkinson, Bell and Dunbar, P.A.; and Victoria L. Weber, Dan R. Stengle,
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and David L. Powell of Hopping Green and Sams, P.A. on behalf Florida
Association of Realtors, Inc,; Florida Institute of Certified Public Accountants and
Florida Institute of Accountants, Inc.; Florida Phosphate Council, Inc.; National
Federation of Independent Businesses, Inc.; Florida Minerals and Chemistry
Council, f/k/a Florida Manufacturing and Chemical Council, Inc.; Florida Fruit and
Vegetable Association, Inc.; Florida Farm Bureau Federation, Inc.; Florida
Cattlemen's Association, Inc.; and Sunshine State Milk Producers, Inc.,
for Opponents