Florida Supreme Court rules public marinas are exempt from tax

By Elizabeth Alt | Jun 29, 2017

TALLAHASSEE — A six-year-long case over taxing marinas came to an end June 15 when the Florida Supreme Court sided with the city of Fort Pierce.

TALLAHASSEE — A six-year-long case over taxing marinas came to an end June 15 when the Florida Supreme Court sided with the city of Fort Pierce.

The high court ruled the city's marinas are tax exempt after a trial court said that the marinas should pay taxes because they are not exclusively used for municipal purposes. In the ruling, Justice R. Fred Lewis noted the important role public marinas provide to the community.

In 2011, Treasure Coast Marina and Riverfront Developers sued the city of Fort Pierce, the St. Lucie County Property Appraiser's Office, the Florida Department of Revenue, et al. The suit claimed that the Fort Pierce City Marina and the Fisherman's Wharf Marina, owned by the Fort Pierce Redevelopment Agency, should pay property taxes because they are commercial enterprises not used exclusively for a municipal purpose. 

The trial court sided with Treasure Coast, using what Lewis called “an exceedingly narrow standard because it believed that we announced a new legal standard and discarded years of precedent when we issued our decision in Gainesville.” The cour was referring to Florida Department of Revenue v. City of Gainesville.

The 4th District Court of Appeal reversed the circuit court decision, siding with the city and property appraiser. Treasure Coast appealed to the state Supreme Court.

In the Supreme Court decision, Lewis wrote the issue is whether public marinas are traditional municipal functions that are presumed to be tax exempt. 

“One need not have special training to realize that marinas provide an invaluable contribution to serving the transportation needs of coastal communities dating to the birth of this nation and our state," he wrote.

The Supreme Court justices concurred on the decision, stating public marinas serve municipal or public purposes by ensuring access to the waterfront, which advances the recreational needs of the citizens and tourists. Lewis further noted that publicly owned and operated facilities are open to the public, as opposed to private facilities, which generally freely pick and choose the clients they wish to serve.

Lewis wrote that public marinas are considered traditional municipal functions, and a public marina owned and operated by a municipality is a traditional municipal function that carries a presumption of tax-exempt status. The court defines the term "municipal purpose" as embracing all activities essential to the health, morals, protection and welfare of the municipality.

Treasure Coast claimed that in Gainesville, the court’s recognition of certain distinctions of prior precedent meant that the legal standard for municipal or public purpose tax exemptions was narrowed.

Lewis disagreed with Treasure Coast’s interpretation of the ruling in Gainesville, writing that "we did not announce a new standard, but rather simply recognized a critical distinction between traditional municipal functions and functions historically provided by the private sector for purposes of the 'municipal or public purposes' constitutional tax exemption … certain categories of services which have been traditionally provided by municipalities, such as public housing and utilities, are within the concept of municipal and public purposes and thus remain exempt from taxation.”

The Supreme Court directed upon remand that the trial court enters a final summary judgment in favor of Fort Pierce.

Supreme Court of Florida, case number SC16-1107

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