EDWARD B. HESS
v.
CITY OF ORLANDO, A MUNICIPAL CORPORATION, ET AL.
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The Florida Supreme Court upheld Orlando's authority to issue utility revenue certificates secured by pledging income from its electric light and water plants, finding that such pledging of limited enterprise revenues does not constitute indebtedness requiring voter approval under the Florida Constitution.
The court held that a city may pledge a limited portion of income derived from its utility enterprises to pay revenue certificates, as this does not constitute indebtedness requiring voter approval because the certificates do not pledge the taxing power, create liens on property, or provide for foreclosure.
“It is shown that from the present revenues derived from the electric light and water plants, the Orlando Utilities Commission can and will contribute $60,000.00 a year to the liquidation of the certificates.”
Establishes the financial capacity to repay the certificates from enterprise revenues without relying on general taxation
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Join FLexlaw to unlock all legal intelligenceOn September 12, 1938, the City of Orlando adopted an ordinance to issue $798,000 in Utility Revenue Certificates to secure a federal loan for sewer s…
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—On the twelfth day of September, 1938, the City of Orlando adopted an ordinance proposing to issue seven hundred ninety-eight thousand dollars in Utility Revenue Certificates for the pu’rpose of securing a loan from the Federal Emergency Administration of Public Works to improve and extend its sewer system, the said loan to be amortized in stated annual payments over a period of thirty years and to bear interest at four per cent, per annum.
The ordinance expressly provides that the certificates will not constitute a lien upon any property or give any right for the appointment of a receiver or foreclosure against the improved sewer system when constructed or against any other property of the City of Orlando. It also proposes to issue said certificates without a freeholder’s election under amended Section 6 of Article IX of the Constitution of the State of Florida and to appropriate ample sums from the revenues derived from the electric light and water plants to liquidate them.
On the fifteenth day of September, 1938, the appellant as plaintiff below filed his bill of complaint in the Circuit Court, wherein he prayed that the City of Orlando, its officers, agents, and employees be restrained from issuing the utility revenue certificates described in said ordinance or from proceeding otherwise under the terms thereof to carry out its purpose. The chancellor denied the relief prayed for and this appeal was prosecuted from his decree.
It is agreed that the question presented is whether or not the income from the electric light and water plants realized under existing rates may be pledged by the City to discharge *833the utility revenue certificates proposed to be issued in the manner and for the purpose stated in the ordinance dated September 12, 1938.
It is shown that from the present revenues derived from the electric light and water plants, the Orlando Utilities Commission can and will contribute $60,000.00 a year to the liquidation of the certificates. It is also shown that the improvement proposed is very much needed, that the certificates are absent the elements to constitute them bonds, that they do not pledge the taxing power of the City, that they do not constitute a lien upon any property of the City of Orlando, that they contain no provision for foreclosure or the appointment of a receiver, that they constitute merely a promise to pay from a specific fund which can be spared for that purpose, that the fund from which they are proposed to be paid in no way involves the taxing power and the maturities are set up on a schedule which makes it possible for the contribution from the electric light and water plant to liquidate each group of certificates when they mature.
The City, in other words, proposes primarily to pledge a lifiiited portion of the income dreived from its electric light and water plants for the contemplated improvement. It is in harmony with Chapter 17118, Acts of 1935, is not an indebtedness requiring an approval vote of the taxpayers, and we think is concluded by State v. City of Fort Pierce, 126 Fla. 184, 170 So. 742, and City of Vero Beach v. McConnell, 125 Fla. 130, 169 So. 628. See also Town of River Junction v. Boykin, 124 Fla. 827, 169 So. 492; Williams v. Town of Dunnellon, 125 Fla. 114, 169 So. 631; Kathleen Land Company v. City of Lakeland, 169 So. 356, 124 Fla. 659.
The judgment below is affirmed.
*834Affirmed.
Ellis, C. J., and Whitfield, Brown, Buford and Chapman, J. J., concur.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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State v. City OF Miami, 150 Fla. 270 (Fla. 1942)…of River Junction, 124 Fla. 827, 169 Sou. 492; Williams v. Town of Dunnellon, 125 Fla. 114, 169 Sou. 631; State v. City of Fort Pierce, 126 Fla. 184, 170 Sou. 742; Brooks v. City of Jacksonville, 127 Fla. 564, 173 Sou. 365; Hess v. City of Orlando, 133 Fla. 831, 183 Sou. 473; State v. City of Pensacola, 135 Fla. 239, 184 Sou. 768; State v. City of Wauchula, 137 Fla. 374, 188 Sou. 365. And also Roach v. City of Tampa, 125 Fla. 62, 169 Sou. 627; Blocker v. City of St. Petersburg, 125 Fla. 156, 169 Sou. 647;…
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Rowe v. City of Fort Lauderdale, 142 Fla. 746 (Fla. 1940)…e and extend its sewerage system. The proposal is authorized [*748] by Chapter 10552, Special Acts of 1925, is not such an indebtedness as requires an approving vote of the taxpayers, and is concluded by the following cases: Hess v. City of Orlando, 133 Fla. 831, 183 So. 473; Trudnak v. City of Fort Pierce, 135 Fla. 573, 185 So. 353; Dickey v. Broward County Port Authority, 135 Fla. 622, 185, So. 349. Other questions have been examined but they present no reversible error so the judgment of the Chancellor…
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State v. Fla. State Tpk. Auth., 134 So. 2d 12 (Fla. 1961)…57). . State v. Florida State Improvement Commission, 71 So. 2d 146 (Fla.1954); State v. Florida State Improvement Commission, 48 So. 2d 156 (Fla.1950); Cf. State v. Town of River Junction, 125 Fla. 267, 169 So. 676 (1936); Hess v. City of Orlando, 133 Fla. 831, 183 So. 473 (1938); Rowe v. City of Fort Lauderdale, 142 Fla. 746, 196 So. 199 (1940); State v. City of Fort Myers, 156 Fla. 681, 24 So. 2d 50 (1945). . State v. City of Miami, 103 So. 2d 185 (FIa.1958); Miller v. City of St. Augustine, 97 So. 2d…
Authorities Cited
- Kathleen Citrus Land Co. v. City of Lakeland, 124 Fla. 659 (Fla. 1936)
- Williams v. The Town of Dunnellon, 125 Fla. 114 (Fla. 1936)
- Boykin v. Town of River Junction, 124 Fla. 827 (Fla. 1936)
- State v. MacConnell, 125 Fla. 130 (Fla. 1936)
- State v. City of Fort Pierce, 126 Fla. 184 (Fla. 1936)