Case Name: NORTHERN PALM BEACH COUNTY WATER CONTROL DISTRICT, etc., Appellant, v. STATE of Florida, etc., Appellee
Court: Florida Supreme Court
Jurisdiction: Florida
Decision Date: 1992-06-16
Citations: 604 So. 2d 440
Docket Number: No. 77098
Parties: NORTHERN PALM BEACH COUNTY WATER CONTROL DISTRICT, etc., Appellant, v. STATE of Florida, etc., Appellee.
Judges: OVERTON, BARKETT, GRIMES and HARDING, JJ., concur.
Reporter: Southern Reporter, Second Series
Volume: 604
Pages: 440–447

Head Matter:
NORTHERN PALM BEACH COUNTY WATER CONTROL DISTRICT, etc., Appellant, v. STATE of Florida, etc., Appellee.
No. 77098.
Supreme Court of Florida.
June 16, 1992.
Charles F. Schoech of Caldwell & Pacetti, Palm Beach, and Anne Longman and Terry E. Lewis of Messer, Vickers, Caparello, Madsen & Lewis, P.A., Tallahassee, for appellant.
David H. Bludworth, State Atty. and Leslie M. Ritch, Asst. State Atty., Fifteenth Judicial Circuit, West Palm Beach, for ap-pellee.

Opinion:
CORRECTED OPINION
PER CURIAM.
This is an appeal from a final judgment which declined to validate water control and improvement bonds proposed to be issued by the Northern Palm Beach Water Control District (District). We have jurisdiction pursuant to article V, section 3(b)(2) of the Florida Constitution, and chapter 75, Florida Statutes (1989).
The District is a drainage district organized and existing under chapter 59-994, Laws of Florida, as amended and supplemented by chapter 89-462, Laws of Florida, and the applicable provisions of chapter 298, Florida Statutes (1989). The District sought validation of water control and improvement bonds to finance on-site road improvements in Unit of Development No. 31 (Unit 31), a unit of the District created for the purpose of draining and reclaiming the land located within the unit. The Unit 31 site, also known as Bailen Isles of the JDM Country Club, is being developed by Hansen-Florida II, Inc., and will include single family residences, multifamily housing, park areas, and three golf courses.
The Circuit Court of the Fifteenth Judicial Circuit appointed three commissioners to prepare a report regarding the District's water management plan for Unit 31. The commissioners' report determined that the estimated cost of the improvements would be less than the benefits assessed against the lands.in Unit 31. The report distinguished between two separate components of the planned improvements. The first component improvements, consisting of the water management system, the water and sewer facilities, and exterior road improvements, are not at issue here. The Program Two improvements, which are the subject of this appeal, include interior or on-site road improvements such as paving, striping, signs, landscaping, irrigation, bridges, an overpass, culverts, street lighting, security gatehouses, and a secondary drainage system consisting of storm drain pipes, inlets, manholes and surface drainage. The commissioners' report assessed the benefits of the Program Two improvements to be $18,125,000. The circuit court entered an order approving and confirming the report.
In December 1989, the Board of Supervisors of the District adopted a general bond resolution which authorized the issuance of Water Control and Improvement Bonds, Unit of Development No. 31, Program Two, in a principal amount not to exceed $16,-312,500. The bond resolution provided that the bonds "shall not be general obligations or indebtedness" of the District, but instead are "special obligations payable solely" from, and secured by, a first lien and pledge of the proceeds of the drainage tax levied on the lands in Unit 31. In March 1990, the Board of Supervisors adopted a resolution levying a $42,625,000 drainage tax on the lands in Unit 31 in proportion to the benefits to be derived from the construction of the Program Two improvements. The amount levied consisted of an initial assessment of $18,125,000, plus the $24,500,000 interest estimated to accrue on the bonds.
After the bond validation hearing, the circuit court entered a final judgment which declined to validate the bonds because "[t]he intended use of the proceeds of this bond issue serves no valid public purpose." The final judgment also stated that the District failed to comply with its enabling legislation because it "did not meet the requirements of the Safe Neighborhoods Act, as enumerated in Sections 163.501-163.522, Florida Statutes."
The scope of judicial inquiry in bond validation proceedings is limited to the following issues: 1) determining if the public body has the authority to issue the bonds; 2) determining if thq purpose of the obligation is legal; and 3) ensuring that the bond issuance complies with the requirements of law. Taylor v. Lee County, 498 So.2d 424 (Fla.1986). Only two questions are presented for our consideration here: 1) whether the revenue bond proceeds will be used for a valid public purpose, and 2) whether the District has complied with the requirements of its enabling legislation in issuing the bonds.
As to the first issue, the State contends that these bonds violate article VII, section 10 of the Florida Constitution, which prohibits the District from using its taxing power or pledging public credit to aid private enterprise, and that no valid public purpose can be served by financing the construction of roadways within a private development where public access will be limited by security gatehouses. The District asserts that in enacting chapters 59-994 and 89-462 the legislature found a public purpose in designating roads for the exclusive use and benefit of a unit of development and its residents.
Article VII, section 10 of the Florida Constitution prohibits the state and its subdivisions, including special districts such as this water control district, from using its taxing power or pledging public credit to aid any private person or entity. However, if the project falls within one of the four subsections of article VII, section 10, then no constitutional prohibition is involved. See Linscott v. Orange County Indus. Dev. Auth., 443 So.2d 97 (Fla.1983). The on-site road improvements planned for Unit 31 do not fall within these four subsections. Thus, in order to determine if the bonds run afoul of the constitution, we must first determine whether the District's taxing power or pledge of credit is involved. If either is involved, then the improvements must serve a paramount public purpose. See Orange County Indus. Dev. Auth. v. State, 427 So.2d 174 (Fla.1983). However, if we conclude that neither is involved, then the paramount public purpose test is not applicable and "it is enough to show only that a public purpose is served." Linscott, 443 So.2d at 101.
Section 298.36(1), Florida Statutes (1989), authorizes the board of supervisors of a water control district to "levy a tax" in proportion to the benefits to be derived from the works and improvements of the district. The District's resolution also refers to the assessment as a "drainage tax." However, we find that a special assessment rather than a tax is at issue in this case. See Lake Howell Water & Reclamation Dist. v. State, 268 So.2d 897 (Fla.1972). As this Court explained in City of Boca Raton v. State, 595 So.2d 25, 29 (Fla.1992), "there is no requirement that taxes provide any specific benefit to the property.... [But] special assessments must confer a specific benefit upon the land burdened by the assessment." We also noted that special assessments must be "reasonably apportioned among the properties that receive the special benefit." Id. Because this is a special assessment, rather than a tax, no use of the District's taxing power is involved. Moreover, the general bond resolution provides that the District cannot be compelled to exercise its taxing power in order to pay the bonds.
The resolution further provides that the bonds "shall be special obligations payable solely" from the drainage assessments to the landowners for the Program Two improvements, and that the bonds "shall not constitute a lien upon any of the facilities or properties" of the District. "Where there is no direct or indirect undertaking by the public body to pay the obligation from public funds, and no public property is placed in jeopardy by a default of the third party, there is no lending of public credit." State v. Housing Fin. Auth., 376 So.2d 1158, 1160 (Fla.1979); see also Nohrr v. Brevard County Educ. Facilities Auth., 247 So.2d 304 (Fla.1971). Thus, the bonds do not contemplate a pledge of the District's credit. Because neither the District's taxing power nor a pledge of its credit is involved here, the bonds need only serve a public purpose rather than a paramount public purpose. See Linscott, 443 So.2d 97.
Chapter 59-994 created the District and imbued it with a number of powers, including the authority to "issue negotiable or other bonds" and "to construct, improve, pave and maintain roadways and roads" needed to access and develop those areas which are made suitable for settlement and development as a result of the operations of the District. Ch. 59-994, § 3, Laws of Fla. Chapter 89-462 empowered the District to construct roads "for the exclusive use and benefit of a unit of development and its landowners, [and] residents," to "finance and maintain said roads and their associated elements as part of a water management plan," and to "construct and maintain security structures to control the use of said roads." Ch. 89-462, § 6, Laws of Fla. Chapter 298, Florida Statutes (1989), also authorizes water control districts to issue bonds to pay for the costs of proposed improvements. See, e.g., § 298.-36(2), 298.47, Fla.Stat. (1989). This enabling legislation evidences a clear legislative expression that the on-site controlled-access roads at issue in this case serve a valid public purpose. In addition, the District's Board of Supervisors adopted a resolution stating that the designation of roads for the exclusive use and benefit of Unit 31 is a public purpose "in the best interest of the health, safety, and general welfare of these areas and their inhabitants, visitors, property owners and workers." This Court has stated that a legislative declaration of public purpose is presumed to be valid, and should be deemed correct unless so clearly erroneous as to be beyond the power of the legislature. Nohrr, 247 So.2d 304. Although these legislative expressions of public purpose are not controlling, they are "entitled to great weight." State v. Leon County, 400 So.2d 949, 951 (Fla.1981).
As to the public purposes actually served by these bonds, we note that the roadway improvements at issue will provide access to the water management facilities and aid in the development of the reclaimed lands. However,.the fact that public access to the roads will be limited raises a question of whether the stated public purposes are only incidental to a primary private purpose, the development of Unit 31 by Hansen-Florida II, Inc. "A broad, general public purpose . will not constitutionally sustain a project that in terms of direct, actual use, is purely a private enterprise." Orange County, 427 So.2d at 179. In Orange County, the Court found that the expansion of a television station's broadcast facilities did not serve a paramount public purpose even though the public would receive a number of benefits from the proposed expansion. However, the Court also noted that the presence of public ownership would be a significant factor in a finding of public purpose. Id.
In this ease, the District will retain ownership of the roadways in question. This public ownership coupled with the legislative declaration of public purpose contained in the District's enabling legislation leads us to the conclusion that the on-site road improvements serve a public purpose. Thus, the proposed water control and improvement bonds are not prohibited by article VII, section 10 of the Florida Constitution.
As to the second issue, the State contends that' .the District failed to comply with its enabling legislation by not meeting the requirements of the Safe Neighborhoods Act, sections 163.501-163.522, Florida Statutes (1989). Thus, the State contends that the District did not have the authority to issue the bonds. The District argues that compliance with chapter 163 is a collateral issue outside the scope of the bond validation hearing.
in light of the legislature's 1991 amendment of the District's enabling legislation, we need not address these arguments. Chapter 91-408, section 2, Laws of Florida, declares the inclusion of "provision in a water management plan for roads for the exclusive use and benefit of a unit of development and its residents" to be a "public purpose" and deletes reference to the Safe Neighborhoods Act.
Accordingly, we reverse the final judgment and remand with directions that the bond issue be approved.
It is so ordered.
OVERTON, BARKETT, GRIMES and HARDING, JJ., concur.
SHAW, C.J., dissents with an opinion, in which KOGAN, J., concurs.
McDONALD, J., dissents.
. Article VII, section 10 of the Florida Constitution provides in pertinent part:
Neither the state nor any county, school district, municipality, special district, or agency of any of them, shall become a joint owner with, or stockholder of, or give, lend or use its taxing power or credit to aid any corporation, association, partnership or person....
. The District's enabling legislation provides in pertinent part:
It is to the benefit of the land in the district and its ultimate users and residents to include provision in a water management plan pursuant to and in furtherance of the Safe Neighborhoods Act, ss. 163.501-163.522, Florida Statutes, for roads for the exclusive use and benefit of a unit of development and its residents.
Ch. 89-462, § 6, Laws of Fla. (emphasis added).
. We do not pass upon the economic desirability of these bonds, but only upon whether they may be legally issued. See, e.g., State v. City of Sunrise, 354 So.2d 1206 (Fla.1978).