INTHE SUPREME COURT OF FLORIDA Case No.: SC06-1894

DR. GREGORY L. STRAND, Appellant,

c D VS. L.T. Case NO.~OOESCAMBIA COUNTY, etc., et al.,

Appellees. CLERK, SUPREME COURT BY.---L-'112--LI.

FLORIDA LEAGUE OF CITIES, INC., ET AL.'S MOTION FOR LEAVE TO FILE AMICI CURIAE BRIEF

Pursuant to Florida Rule of Appellate Procedure 9.370, the following entities

(collectively, "movants") respectfully request leave to appear as amici curiae in

connection with rehearing of the matters addressed in the opinion dated September

6, 2007 (the "initial opinion"):

The Florida League of Cities, Inc. The Florida Redevelopment Association, Inc. The City of Hollywood The City of Hollywood, Florida Community Redevelopment Agency The City of Margate The City of Margate Community Redevelopment Agency The City of Miami Beach The Miami Beach Redevelopment Agency The City of Panama City Beach

&CBMSL

The Community Redevelopment Agency of the City of Palmetto The City of St. Petersburg The South Florida Water Management District The City of West Palm Beach The West Palm Beach Community Redevelopment Association

The initial opinion implicates critically important public policy considerations and

threatens the stability of the Florida municipal bond market and the day-to-day

operation of municipalities, counties, school districts, community redevelopment

agencies ("CRAs") and other governmental units. Accordingly, if granted leave to

appear, movants respectfully request that the Court expedite the schedule for

further briefing and argument of this matter.

Introduction

While Florida Rule of Appellate Procedure 9.370(c) contemplates that an

amicus brief will be served in conjunction with the parties' briefs, the rule also

authorizes the Court to "grant leave for later service." Movants did not seek leave

to appear earlier, because the appeal in this case did not raise the constitutionality

of any Court precedents. Movants did not expect the Court to recede from or

overrule any prior precedents, because the parties did not ask the Court to do so.

E.g., cJ, DepJt of Fin. Servs. v. Freeman, 921 So. 2d 598, 606 (Fla. 2006)

(Cantero, J., concurring). While the limits on the Court's latitude to reach issues

are more prudential than jurisdictional, rarely should the Court modify precedent

without first affording an opportunity for h l l briefing and argument by interested

persons. See Blonder-Tongue Labs., Inc. v. Univ. of Ill. Found., 402 U.S. 3 13,

3 19-20 (1971); see also Savoie v. State, 422 So. 2d 308, 3 10 (Fla. 1982) ("[Olnce

we accept jurisdiction over a cause in order to resolve a legal conflict, we may, in

our discretion, consider other issues properly raised and argued before this

Court.") (emphasis added).

Movants seek leave to file their brief in conjunction with rehearing of this

matter. Rehearing is appropriate for the Court to consider whether it can dispose

of the case without deciding constitutional questions and with full consideration of

potential consequences. See, e.g., Ashwander v. Tenn. Valley Auth., 297 U.S. 288,

347 (1936); Fla. Bar v. Rayman, 238 So. 2d 594, 596 (Fla. 1970). This principle is

particularly important when joined with the doctrine of stare decisis, which reflects

the sound jurisprudential policy that "in most matters it is more important that the

applicable rule of law be settled than that it be settled right." Burnet v. Coronado

Oil & Gas Co., 285 U.S. 393,406 (1932) (Brandeis, J., dissenting). Rehearing and

further briefing will assist the Court with the complete analysis that this Court has

expressed as necessary before departing from its prior decisions:

Before overruling a prior decision of this Court, we traditionally have asked several questions, including the following. (1) Has the prior decision proved unworkable due to reliance on an impractical legal "fiction"? (2) Can the rule of law announced in the decision be reversed without serious injustice to those who have relied on it and without serious disruption in the stability of the law? And (3) have the factual premises underlying the decision changed so drastically as to leave the decision's central holding utterly without legal justification? The presumption in favor of stare decisis is strong . . . .

N. Fla. Women's Health & Counseling Sews., Inc. v. State, 866 So. 2d 612, 637-38

(Fla. 2003).

This traditional analysis, absent from the initial opinion, will reveal that for

many decades local governments have followed the Court's clear guidance in

negotiating and developing carefully crafted financing vehicles. The Court's

precedents, far fi-om being "unworkable due to reliance on an impractical legal

'fiction,"' have in fact respected the taxpayer protection afforded by the referendum

requirement while at the same time providing practical access to critically needed

capital. The resulting financing vehicles, while sometimes complicated, have now

become stable, well known and accepted instruments in the national and

international credit markets, where they give Florida a competitive advantage.

Some may view these vehicles as resting in part on legal "fictions," but that in

itself is insufficient reason to abandon them, as the test of time has proven them

not only practical but absolutely necessary to deliver the infrastructure demanded

by Florida's rapid growth. See Petersen v. Brutman, 100 So. 2d 821, 824 (Fla. 2d

DCA 1958) (legal fictions can serve worthwhile purpose, especially when long

standing and clearly understood). The initial opinion recedes from precedents

whose underlying factual premises have not changed, and in doing so it has

dangerously disrupted the stability of the law.

The Movants' Interest

Movants' particular organizational details are set forth in Exhibit 1 attached

to this motion. Collectively, they represent over five hundred municipalities, units

of local government providing municipal services, and CRAs devoted to the public

welfare of Florida's citizens. Many have created CRAs and have issued bonds

under or in reliance upon the Community Redevelopment Act of 1969, as amended

(codified as chapter 163, part 111, Florida Statutes (2007)) (the "Redevelopment

Act"). Based upon decades of settled case law in Florida, these bonds play an

important role in local governments meeting their obligations to redevelop blighted

and slum areas and to fund infrastructure and basic government services. In

addition, numerous Florida governments have issued certificates of participation

("COPs") for basic government facilities, including schools, city halls, fire stations

and other buildings serving important government functions. The same basic

financing structure used for COPs has also been used for lease-purchase

transactions involving purchase of basic equipment.

The initial opinion implicates issues of extreme significance to the movants

and to the holders of their outstanding bonded indebtedness. The parties to the

case and amicus Florida Association of Counties did not brief or argue,' and the

initial opinion did not discuss, the adverse effects the opinion could have on

Florida governments. Without full briefing or argument or consideration of the

1While Dr. Strand did make a general reference to the unconstitutionality of the proposed bonds under article VII, section 12, of the Florida Constitution, the primary focus of his initial brief was on the "home-rule" power of Escambia County. This issue was not mentioned in the initial opinion, and it will not be focused upon in the proposed brief.

impact on local governments, the initial opinion proposes to overturn decades of

settled jurisprudence while overlooking a basic concept of Florida constitutional

law that dates back to 1930. Under both the Constitution of 1885 and the

Constitution of 1968, the referendum requirement is triggered only when a taxing

authority's ad valorem taxing power is pledged to the repayment of a bond issue.

See Tucker v. Underdown, 356 So. 2d 251 (Fla. 1978); Town of Medley v. State,

162 So. 2d 257 (Fla. 1964). No court has ever held that referendum approval is

required before using revenues generated from ad valorem taxation to pay debt

service on a bond, where bondholders cannot directly or indirectly compel the levy

of ad valorem taxation. Before announcing this dramatic new rule, the Court

should study in-depth briefs on this particular issue from the parties and other

interested persons, and also ensure that it has thoughtfully considered how such a

ruling would disrupt the stability of the law and the rights of those who have relied

upon the settled interpretation. See, e.g., United States v. Title Ins. & Trust Co.,

265 U.S. 472, 486 (1924); N. Flu. Women's Health, 866 So. 2d at 637-38; Atlantic

Coast Line R. Co. v. City of Lakeland, 115 So. 669, 688 (Fla. 1928) (Brown, J.,

concurring).

In the wake of the initial opinion's reversal of years of settled jurisprudence,

the historically stable capital markets for Florida public debt obligations are in a

state of widespread upheaval. In good faith reliance on long-standing precedent,

many local governments have issued debt structured to comply with the

Redevelopment Act, without burdening this Court with unnecessary validation

proceedings. See $ 75.02, Fla. Stat. (2007) (validation is optional, not required).

In fact, very few bond issues are validated. The status of this debt is now unknown

and unstable, in light of the Court's signal that the "decision in this case does not

affect bonds that were validated prior to this opinion becoming final" (emphasis

added). What of the obligations that have been issued but not validated? The

Court must act to restore stability in the market place.

The market understands the implications of the initial opinion. Rating

agencies immediately responded with the drastic step of placing certain Florida

debt obligations on negative credit watch.2 These impacts may cost Florida local

governments millions of dollars in increased issue costs, including higher interest

rates. The risks stem not only from the potential increased cost of outstanding

variable interest rate instruments, but also fiom the pall cast over the entire

marketplace for Florida's outstanding debt.

If this Court does not modify or clarify the initial opinion, many Florida

local governments' debt may be deemed unconstitutional, leading the Internal

"ee FitchRatings, Fitch Places 164.2 MM of Florida TIF Bonds on Watch Negative; Comments on Florida School COPS (Sept. 11, 2007); Robin Prunty, Standard & Poor's, Florida School Dist. CertzJicates on Watch Afer Uncertainty of FL Supreme Court Decision (Sept. 11, 2007); Robin Prunty, Standard & Poor's, Florida Bonds Secured by Tax Increment Revenues Placed on Creditwatch Negative (Sept. 7,2007) (available at www.standardandpoors.com/ratingsdirect).

Revenue Service to revoke their tax-exempt status. Issuers of non-validated debt

will face dramatically increased interest costs and risk default of their debt

obligations, as the legality of using the tax increment revenue to pay the debt is

now called into question. Both the taxpayers and the bondholders will be

penalized. Just as egregious, the capital markets that buy local governments' debt

may shun all issues of Florida public debt, not just those that are structured as tax

increment financing. Until now, Florida has been a very attractive source of high-

quality, new-issue securities with favorable interest rate pricing. But capital

markets for Florida debt may evaporate if the initial opinion is understood to

unnecessarily, broadly, and retroactively reverse precedent involving a property

right obtained in good faith. Purchasers of debt crave consistency and

predictability; in their absence, investors will simply look to the more stable debt

of issuers from outside of Florida. This exodus of capital markets will inevitably

cost Florida citizens a great deal of money as investors refuse to purchase Florida

bonds at competitive rates. To make their debt more attractive, Florida

governments would be practically forced to have all debt validated. This action

will greatly increase the demand upon precious resources of the various state

attorneys and the judicial system, and it will also increase the time to enter the

market and the associated costs.

The Issues to be Addressed

In reversing the trial court's final judgment validating Escambia County's

(the "County") proposed bonds, the initial opinion concluded that the "County is

without authority to issue these bonds without first obtaining approval by

referendum as required by article VII, section 12 of the Florida Constitution."

Initial Op. at 1. The Court receded from its decisions in State v. Miami Beach

Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), and in State v. School Board

of Sarasota County, 561 So. 2d 549 (Fla. 1990), "to the extent they are inconsistent

with [the] decision in this case." Initial Op. at 27. Florida governments have relied

on these precedents for decades, and currently have billions of dollars of debt

outstanding whose validity is now called into question by the initial decision. To

eliminate market uncertainty and provide clearer guidance to local governments

that have and will rely upon tax increment financing for public improvements,

movants propose to address the following issues:

First, should the Court have receded from Miami Beach and School

Board of Sarasota County?

Second, is the County financing structure hndamentally different

from the structures at issue in numerous cases approved over many years,

including Miami Beach and School Board of Sarasota County and other cases not

addressed in the initial opinion,3 where the Court approved the issuance of revenue

bonds, notwithstanding the fact that ad valorem tax revenues may be used to pay

debt service?

Third, should the holding affect COPS transactions or other

obligations with a maturity not exceeding one year, as described in School Board

of Sarasota County?

Fourth, should the holding affect contractual obligations incurred by

local governments in connection with community redevelopment projects?

How the Proposed Brief Can Assist in Disposition of the Case

The proposed brief can assist in disposition of the case by outlining the

history of tax increment financing and, in particular, the differences between the

facts of this case and the facts of Miami Beach and the many subsequent

transactions that have relied upon Miami Beach. Movants have undertaken the

vast majority of tax increment financings in Florida. By virtue of their experience

and broad statewide representation, movants have perspective and information

regarding these issues that will serve as a usefbl supplement to the interests

represented by the parties, which will benefit the Court in its reconsideration of the

initial opinion.

3 ~ e e ,e.g.,Holloway v. Lakeland Downtown Dev. Auth., 4 17 So. 2d 963 (Fla. 1982); Kelson v. City of Pensacola, 483 So. 2d 77 (Fla. 1 st DCA 1986).

As to the first issue, the proposed brief will hlly outline the history of

Florida law prior to Miami Beach and argue for its continued validity as a rational

reflection of the Court's decisions since the 1930 amendment to the Constitution of

1885, starting with State v. City of Miami, 152 So. 6 (Fla. 1933). The brief will

address the Court's concerns that Miami Beach did not rely on well established

principles and precedents, which is clearly not the case. While Miami Beach's

discussion of the constitutional issues was limited, counsel has reviewed the reply

brief in Miami Beach and represents that this issue was thoroughly briefed. In

particular, the proposed brief will reveal Miami Beach's strong foundation in such

precedents as Seaboard Air Line Railroad .Co. v. Peters, 43 So. 2d 448 (Fla. 1949),

Tucker, and Town of Medley.

In Seaboard, the Dade County port authority proposed to issue $3,000,000

in bonds payable solely from a special fund, into which the authority would deposit

the net operating revenues of the airport and the proceeds of ad valorem taxes it

was authorized to levy for the purchase of land and for the expansion and

development of the airport. The authority did not grant any rights to the

bondholders in the authority's ability to compel ad valorem taxation, but rather

solely a lien on the funds in the special fund. As a result, there was no prohibited

pledge of the taxing powers of the authority, and no violation of the relevant

constitutional prohibition which required referendum approval to pledge the power

to tax to support the repayment of a bond. In Tucker, the Court recognized that the

Constitution of 1968 does not prevent a local government from using ad valorem

tax revenues where it is required to compute and set aside a prescribed amount,

when available, for a discreet purpose (servicing the bond obligations). See 356

So. 2d at 254. Town of Medley confirmed the constitutionality of using ad valorem

taxes as long as they were not pledged, and reiterated that only bonds or

certificates of indebtedness that directly obligate the ad valorem taxing power were

encompassed by article IX, section 6, of the Constitution of 1885. See 162 So. 2d

at 258. In addition, the proposed brief will address the impact of County of Volusia

v. State, 41 7 So. 2d 968 (Fla. 1982), and will clearly show why Miami Beach is

consistent with that decision.

It is critical to understand that under Miami Beach, ad valorem taxes are not

required to be levied, and ad valorem tax revenues are not required to be deposited

into the redevelopment trust fund. A taxing authority required by law to

appropriate funds to the trust fund may deposit any legally available funds. See

Kelson v. City of Pensacola, 483 So. 2d 77 (Fla. 1st DCA 1986). Therefore, the

initial opinion incorrectly states that use of the increment revenues4 to support a

bond issue cannot occur without a referendum. If the taxing authorities elect to

appropriate non-ad valorem revenues to the community redevelopment trust hnd,

4See 8 163.340(22), Fla. Stat. (2007) (defining increment revenues).

12

as they are allowed to do, the increment revenues will consist of no funds which

have as their source ad valorem taxes. Further, if the source of funds in the

community redevelopment trust fund is a mixture of monies generated from both

non-ad valorem and ad valorem tax revenues, for this Court to hold that a pledge of

those funds to a bond issue requires a referendum places the local government in

the difficult and unnecessary situation of tracking and identifying the source of all

of its funds to make sure that none can be traced to ad valorem taxes and overturns

case law that has been developed and relied upon since the adoption of the 1930

amendment to the Constitution of 1885. This Court has never recognized or

required the specific tracking of such funds. See Miami Beach, 392 So. 2d at 894.

For the foregoing reasons, movants submit that the Court should wholly

abandon the initial opinion's analysis and conclusions. As a second issue,

however, the proposed brief will identify important differences between the facts

here and Miami Beach. The proposed brief will describe how the County's actions

in this case differed from the actions municipalities, counties, and CRAs typically

take under the Redevelopment Act. The brief will not contend that a government

must use the Redevelopment Act; however, there are significant facts in the present

case that could lead the Court to find constitutional infirmity in the County's

program on narrower grounds, without overturning years of settled precedent. This

understanding will assist the Court in disposing of this case without unduly

prejudicing the many transactions contemplated or completed in reliance upon

Miami Beach and in accordance with the safeguards similar to those set forth in the

Redevelopment Act. Such transactions are critically important to local

governments' ability to further the public good, and their future viability is

dangerously threatened by the initial opinion.

A much narrower ground for decision is that the County did not establish a

separate authority to undertake the financing and delivery of the proposed capital

projects using tax increment financing. The establishment of a separate legal

authority without the power to levy ad valorem taxation is a factor the Court must

consider.' Essentially, through a single ordinance enactment process, the County

identified an area, articulated an amount of dollars measured by taxes derived from

the area and deposited into a fund held by the County, and then pledged the dollars

in that fund as if it were a community redevelopment trust fund under the

Redevelopment Act. The dollars in the community redevelopment trust fund set

up by the County never were to be transferred to another entity (with no ad

valorem taxing power) and thereby removed from the County's ownership. If the

5A CRA is a body politic and corporate, separate and distinct from any other public body, and is a special district. See tj 163.356 Fla. Stat. (2007); see Panama City Beach Comm. Redev. Agency v. State, 831 So. 2d 662 (Fla. 2002). It does not have power to compel or levy ad valorem taxation. A CRA may issue a bond or enter into an interlocal agreement to contribute funds fiom a redevelopment trust fund to a bond financing. See State v. City of Daytona Beach, 43 1 So. 2d 981 (Fla. 1983) (an interlocal agreement, evidencing indebtedness, may be validated under chapter 75, Florida Statutes).

Court so chooses, the Court could invalidate this approach on much narrower

grounds than those articulated in the initial opinion, and could clearly do so

without receding from Miami ~ e a c h . ~

In addition and very important to this case as clearly recognized in the initial

opinion, was the testimony at trial that ad valorem taxes were the primary source of

revenue to be deposited into the trust fund. Typically, a CRA pledges only those

revenues in the community redevelopment trust hnd, and those revenues can come

from a variety of revenue sources other than ad valorem taxes, including utility

taxes, sales taxes, occupational license taxes, fines and forfeitures, state revenue

sharing, or fees. Under the Redevelopment Act, once deposited into a community

redevelopment trust fund, the revenues are funds of the CRA (statutorily

constrained to be used for community redevelopment) and no longer owned by a

contributing taxing authority. The Redevelopment Act process also includes many

procedural safeguards not present here, such as detailed planning requirements,

extensive public hearings, and expenditure constraints.

The many differences that the proposed brief will more h l ly develop should

lead the Court to reconsider its observation that the "County's tax increment

-

% narrower decision would also leave intact another case cited by the County, where a separate legal entity was established and tax increment funds were removed from the possession of the taxing authority upon deposit into a trust fund. See Penn v. Fla. Defense Fin. & Accounting Serv. Ctr. Auth., 623 So. 2d 459 (Fla. 1993).

financing scheme is certainly consistent with the premise and ultimate holdings of

Miami Beach." In fact, the County's approach is fundamentally different from the

premise and holdings of Miami Beach and its progeny, which have yielded

carefully considered and approved general law tax increment financing concepts.

The Court should not abandon these concepts unnecessarily or without fully

appreciating the consequences of doing so. The Court can easily decide the case

on narrower grounds, such as by recognizing that the County never relinquished

ownership of the measurement of the funds to be contributed (the incremental

increase in ad valorem tax revenues in the redevelopment area), specifically the ad

valorem tax revenues the County anticipated would be used to repay the bonds.

The third issue the proposed brief will address is the important difference

between the debt proposed by the County and COPs issued in reliance upon School

Board of Sarasota County. In unnecessarily receding from that decision, the Court

has generated great uncertainty concerning more than $12 billion of outstanding

COPs. This issue is of extreme importance. Not only have local governments

issued COPs for essential buildings, they also have acquired hundreds of millions

of dollars of equipment using lease-purchase financing structures based upon the

same concept.

Finally, the proposed brief will address the danger that the initial opinion

might unconstitutionally impair existing contracts. Good faith purchasers of local

government debt are the most obvious, but not the only, contract right holders

threatened by retrospective operation of the initial opinion. Many local

governments have expended sums in anticipation of CRA bonds neither validated

nor issued. Further, many have agreed to issue CRA bonds later as consideration

for contracts with developers that have undertaken renewal projects. The

anticipated bonds would provide the funds necessary for the local governments to

satisfy the contractual rights to payment of those involved in the redevelopment

process, e.g., costs of feasibility studies, design and conceptual plans, engineering,

purchase of property, geotechnical testing and remediation, etc. The bonds have

not been validated because the total costs cannot be estimated (and thus the bond

amount not known) until all of the expenses have been incurred. The final decision

in this case should not impair the contracts relating to redevelopment projects in

process, even if the bonds are unvalidated and unissued. See, e.g., Florida Forest

& Park Sew. v. Strickland, 18 So. 2d 25 1, 253 (Fla. 1944). Where a statute has

received a given construction by a court of supreme jurisdiction and rights have

been acquired in accordance with that construction, those rights should not be

destroyed by retroactively applying a subsequent overruling decision. Instead, the

overruling decision should unambiguously be given a prospective operation only,

in the same manner as though the new construction had been added to the statute

by legislative amendment. Id.

Consent of Parties

Undersigned counsel contacted counsel for all parties to obtain their consent

to the filing of the proposed brief. Counsel for the County consents; counsel for

Dr. Strand does not consent.

Based on the foregoing, movants respectfully request that this Court, upon

granting rehearing of this matter, also enter an order granting them leave to file an

amici curiae brief addressing the issues outlined above. Further, movants request

an expedited schedule for briefing and reargument.

Respectfully submitted this / @ % a y of September, 2007.

Randall W. Hanna Florida Bar No. 398063 Bryant Miller Olive P.A. 10 1 North Monroe St., Suite 900 Tallahassee, FL 3230 1 (850) 222-86 1 1 (850) 222-8969

Harry Morrison, Jr. Florida Bar No. 339695 P.O. Box 1757 Tallahassee, FL 32302-1 757 (850) 222-9684 (850) 222-3806 (fax)

Attorneys for the Florida League of Cities, Inc.

David E. Cardwell Florida Bar No. 205419 The Cardwell Law Firm 7380 Sand Lake Road, Ste. 500 Orlando, FL 328 19 (407) 352-3989 (407) 876-4627 (fax)

Attorneys for the Florida Redevelopment Association, Inc.

Bruce Giles-Klein Florida Bar No. 0542652 Greenberg Traurig, P.A. 122 1 Brickell Avenue Miami, FL 33 13 1 (305) 579-0573 (305) 961-5573 (fax)

Attorneys for the City of Hollywood and the City of Hollywood, Florida Community Redevelopment Agency

Eugene M. Steinfeld Florida Bar No. 01 84567 5790 Margate Boulevard Margate, FL 33063-3699 (954) 972-6454 (954) 935-5304 (fax)

Attorney for the City of Margate and the City of Margate Redevelopment Agency

Jose Smith, Esquire Florida Bar No. 176156 1700 Convention Center Drive, Fourth Floor Miami Beach, FL 33 139

(305) 673-7000 (305) 673-7002 (fax)

Attorneys for the City of Miami Beach and the City of Miami Beach Redevelopment Agency

Michele S. Hall, Esq. Florida Bar No. 160008 Michele S. Hall, P.L. 505 25th Street W. Bradenton, FL 34205 (941) 745-1920 (8 13) 433-5556 (fax)

Attorneys for the Community Redevelopment Agency of the City of Palmetto

Douglas J. Sale Florida Bar No. 22099 1 Kevin D. Obos Florida Bar No. 57 1660 Harrison, Sale, McCloy, Thompson, Duncan & Jackson, Chtd. P.O. Drawer 1579 Panama City, FL 32402 (850) 769-3434 (850) 769-6121 (fax)

Attorneys for the City of Panama City Beach

John C. Wolfe Florida Bar No. 159 165 Post Office Box 2842 St. Petersburg, FL 3373 1 (727) 893-7401 (727) 892-5262 (fax)

Attorneys for the City of St. Petersburg

Frank S. Bartolone FL Bar No. 236209 3301 Gun Club Road, MSC 1410 West Palm Beach, FL 33406 (561) 682-2884 (561) 682-6276 (fax)

Attorneys for the South Florida Water Management District

Claudia M. McKenna Florida Bar No. 520586 City Attorney 200 2nd Street West Palm Beach, FL 33401 (561) 822-1350 (561) 822-1373 (Fax)

Attorneys for the City of West Palm Beach and the West Palm Beach Community Redevelopment Association

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing and attached exhibit has

been furnished this 17@day of September, 2007, by U.S. Mail, to the following:

David S. Theriaque Theriaqaue, Vorbeck and Spain 433 North Magnolia Drive Tallahassee, Florida 32308

Attorney for Appellant

Kerry Ann Schultz Bordelon and Schultz Law Firm, P.L. 2721 Gulf Breeze Parkway Gulf Breeze, Florida 32563

Attorney for Appellant

Richard Lott Lott & Associates, P.L. 362 Gulf Breeze Parkway, Ste. 288 Gulf Breeze, FL 32561 Attorney for Appellees

David G. Tucker Nabors, Giblin and Nickerson, P.A. 1500 Mahan Drive Suite 200

, Tallahassee, FL 32308

Attorney for amicus curiae, Florida Asso

~ ~ W D Y8V6 Attorney

Florida League of Cities, Inc.

The Florida League of Cities, Inc. ("League"), is a statewide organization consisting of municipalities and units of local government providing municipal services. The principal purpose of the League is the improvement and efficient administration of municipal government in Florida. Toward this end, the League represents its members, including over four hundred municipalities, before the judicial branch on issues pertaining to their welfare.

Florida Redevelopment Association, Inc.

The Florida Redevelopment Association, Inc. ("FRA") is a statewide organization consisting of cities, counties, CRAs, consultants, financial firms, and individuals committed to the redevelopment of Florida's urban areas and small cities, and supports the ability of local governments to create and effectively use CRAs to redevelop and revitalize their urban areas, including the use of tax increment financing pursuant to section 163.387, Florida Statutes (2007). FRA's mission is to promote the improvement of downtowns and other urban areas including small cities, through redevelopment and development activities under the Redevelopment Act; encourage Florida's communities to create a healthy mix of affordable workforce and market rate housing; and provide a forum for networking, training and technical assistance; be an advocate for its membership; and monitor legal and legislative issues impacting its members and redevelopment. FRA hrther supports local control and disposition of any disputes between local governments over the use of such agencies and financing. Through an informal survey of its members since the initial opinion appeared, FRA has identified over $1 billion in outstanding CRA financing that could be adversely affected by the initial opinion, as identified on pages 8 and 9 of this Exhibit 1.

City of Hollywood

The City of Hollywood, Florida (the "City") is a municipal corporation organized and existing under the laws of the State of Florida. In accordance with the requirements of the Redevelopment Act, in furtherance of the purposes thereof, and in reliance upon this Court's opinion in State v. Miami Beach Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), the City approved the issuance by the Hollywood, Florida Community Redevelopment Agency (the "CRA"), without prior approval by voter referendum and without the benefit of a validation judgment, $60,010,000 in aggregate principal amount of the Agency's

Case No. SC06- 1894 Exhibit 1 Motion for Leave to File Amici Curiae Brief Page 1 of 9

Redevelopment Revenue Bonds (Beach CRA) (the "Bonds"), of which $58,245,000 remains outstanding.

The City believes the issues presented in the initial opinion relate to matters of great public importance because they call into question the validity of the Bonds (and other bonds outstanding of many similarly situated community redevelopment agencies) and the ability of the CRA (and similarly situated agencies) to issue bonds pursuant to the Act in order to carry out the purposes of the Act and the Community Redevelopment Plan of the CRA, which has also been approved by the City. The manner in which this Court deals further with the issues presented in the initial opinion are of fundamental importance to the citizens of the City.

City of Hollywood, Florida Communitv Redevelopment Agency

The City of Hollywood, Florida Community Redevelopment Agency ("HCRA") is a public body formed under the Redevelopment Act. In reliance upon State v. Miami Beach Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), HCRA has issued in furtherance of the purposes of the Redevelopment Act, but without prior approval by voter referendum and without the benefit of a validation judgment, $60,010,000 in aggregate principal amount of its Redevelopment Revenue Bonds (Beach CRA) (the "Bonds"), of which $58,245,000 remains outstanding.

HCRA believes the issues presented in the initial opinion relate to matters of great public importance because they call into question the validity of the Bonds (and other bonds outstanding of many similarly situated community redevelopment agencies) and the ability of HCRA (and similarly situated agencies) to issue bonds pursuant to the Redevelopment Act in order to carry out the purposes of the act and HCRA's Community Redevelopment Plan. The manner in which this Court deals further with the issues presented in the initial opinion are of fundamental importance to the CRA and the citizens of the City of Hollywood.

City of Margate

The City of Margate, Florida (the "City") is a municipal corporation organized and existing under the laws of the State of Florida. In accordance with the requirements of the Redevelopment Act, in furtherance of the purposes thereof, and in reliance upon this Court's opinion in State v. Miami Beach Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), the City approved the issuance by the City of Margate Community Redevelopment Agency (the "CRA"), without prior approval by voter referendum and without the benefit of a validation judgment, the CRA's

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$15,000,000 Community Redevelopment Revolving Line Of Credit Bond, Series 2006 (the "Bond"), all of which remains outstanding.

The City believes the issues presented in this initial opinion relate to matters of great public importance because they call into question the validity of the Bond (and other bonds outstanding of many similarly situated community redevelopment agencies) and the ability of the CRA (and similarly situated agencies) to issue bonds pursuant to the Act in order to carry out the purposes of the Act and the Community Redevelopment Plan of the CRA, which has also been approved by the City. The manner in which this Court deals further with the issues presented in the initial opinion are of fundamental importance to the citizens of the City.

City of Marpate Community Redevelopment Agency

The City of Margate Community Redevelopment Agency ("CRA") is a public body corporate and politic, organized and existing under and pursuant to the Redevelopment Act. In reliance upon this Court's opinion in State v. Miami Beach Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), the CRA has issued in furtherance of the purposes of the Act, but without prior approval by voter referendum and without the benefit of a validation judgment, its $15,000,000 Community Redevelopment Revolving Line Of Credit Bond, Series 2006 (the "Bond"), all of which remains outstanding.

The CRA believes the issues presented in the initial opinion relate to matters of great public importance because they call into question the validity of the Bond (and other bonds outstanding of many similarly situated community redevelopment agencies) and the ability of the CRA (and similarly situated agencies) to issue bonds pursuant to the Act in order to carry out the purposes of the Act and the CRA's Community Redevelopment Plan. The manner in which this Court deals further with the issues presented in the initial opinion are of fundamental importance to the CRA and the citizens of the City of Margate.

City of Miami Beach and Miami Beach Redevelopment Agency

The Miami Beach Redevelopment Agency ("MBRA") is a public body corporate and politic created by the City of Miami Beach (the "City") in 1976 pursuant to the Redevelopment Act. MBRA was the proposed issuer of the bonds in the Supreme Court's decision of State v. Miami Beach Redevelopment Agency, 392 So. 2nd 875 (Fla. 1980), which has been relied upon since then in the issuance of tax increment bonds in the State of Florida.

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Two redevelopment areas were established within the City limits and over the years, MBRA has issued, in accordance with the Redevelopment Act and in the furtherance of its redevelopment plans, without approval by voter referendum and without the benefit of validation, $196,2 15,000 principal amount of tax increment revenue bonds payable from tax increment revenues, of which $91,645,000 principal amount are currently outstanding. In addition, MBRA has numerous additional contractual obligations payable fiom tax increment revenues.

The initial opinion calls into question the validity of MBRA's bonds and the ability of MBRA to pay debt service thereon and other related obligations as well as its other contractual obligations. It also affects the ability of MBRA to issue tax increment revenue bonds in the future as may be necessary to carry out the redevelopment plan.

City of Panama City Beach

In 2003, the City of Panama City Beach, a Florida municipal corporation, validated its $1 50,000,000 Capital Improvement Revenue Bonds (Front Beach Road Project) which are payable through an Interlocal Agreement between the City and the Panama City Beach Community Redevelopment Agency, a body corporate and politic. In the Interlocal Agreement, the Redevelopment Agency has promised to pay to the City from the Agency's FS 1 63.3 87 Redevelopment Trust Fund monies, if and when collected, sufficient to meet debt service on the City's bonds. In reliance upon the Redevelopment Act, and the final judgment validating the bonds to be issued, the City has embarked upon implementation of the adopted Front Beach Road Community Redevelopment Plan. In 2006, $54,835,000 of the validated bonds were issued and are outstanding. To date, as part of the redevelopment plan, the City has expended $17,000,000 to acquire real estate to be developed for public parking, rights of way and stormwater facilities, $6,000,000 for planning, research and design, and has entered two, initial construction contracts totaling $17,000,000. To continue the redevelopment program, the City's adopted FY 2007-08 budget contains additional income of $30,000,000 to be derived fiom the planned sale of a second series of validated but un-issued bonds. The initial opinion may place in jeopardy the sale of additional bonds and, in turn, the City's entire Redevelopment Plan.

Community Redevelopment Agency of the City of Palmetto

The Community Redevelopment Agency of the City of Palmetto ("CRA") is a public body corporate and politic, lawfully established and operating under and

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pursuant to the Redevelopment Act. The City encompasses approximately six square miles, two-thirds of which lie within the Community Redevelopment District. The CRA presently has in place approximately $ 4,195,000 of long term debt. The CRA's 2007-2008 budget is contingent upon the CRA acquiring an additional $ 1,200,000 of long term debt. All debt is to be repaid from the CRA's F.S. 163.387 Redevelopment Trust Fund monies, Existing and future CRA loan proceeds, utilized exclusively for capital projects that are essential to facilitate redevelopment within the District, could be adversely affected by the court's decision. In addition to jeopardizing redevelopment efforts within the boundaries of the community development district, the court's decision puts at risk vital city- wide infrastructure projects that are inextricably linked to improvements funded by the CRA, such as the relocation and upgrade of certain utility facilities. Notably, flood insurance rates decreased city-wide as a result of recent storm water improvements funded by CRA loan proceeds. Without clarification, the court's decision potentially hinders the CRA's ability to deliver important benefits such as this to the taxpayers of Palmetto.

City of St. Petersburg

The City of St Petersburg, Florida, created the Intown Redevelopment Area in the early 1980's. In reliance on State v. Miami Beach Redevelopment Agency, 392 So. 2d 875 (Fla. 1980), the City has two unvalidated bond issues outstanding in the amount of approximately $30,000,00 which pledge the tax increment. The City continues with its redevelopment efforts and will be significantly adversely affected by the initial opinion.

South Florida Water Management District

The South Florida Water Management District, a public corporation of the State of Florida, is charged with several statutory duties and hnctions, including, in partnership with the State of Florida and United States Army Corps of Engineers, implementation of the Comprehensive Everglades Restoration Program (CERP). In 2005, the District approved the issuance of $1,800,000,000 of certificates of participation (COPs) for the purpose of financing the construction of several CERP projects. This approval was based on the opinion of the Florida Supreme Court in the case of-State v. School Board of Sarasota County, 561 So. 2d 549 (Fla. 1990). To date, $546,120,000 of COPs have been issued; the District anticipates issuing the balance of the COPs in the next two years. The initial opinion could affect the issuance of additional COPs to complete the projects.

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City of West Palm Beach and West Palm Beach Community Redevelopment Agency

The City of West Palm Beach, a Florida municipal corporation (City), formed the West Palm Beach Community Redevelopment Agency (WPCRA) and established the CRA's Redevelopment Trust Fund in 1984. In 1985, the City adopted the West Palm Beach City Center Redevelopment Plan for the City Center area based on a blight study and findings of necessity (the Redevelopment Plan). A second redevelopment area, the Northwood/Pleasant City area, and its redevelopment trust fund was established in 1993.

Since 1985, the City has been engaged in redevelopment efforts that have resulted in such projects as Cityplace and Kravis Center. Most recently, the City and WPCRA have undertaken a mile-long waterfront redevelopment project along the Intracoastal Waterway (Waterfront Park and City Commons) and the building of a new city hall, library and photographic museum in the heart of the downtown (City Center).

To fbnd these and other important redevelopment projects, the City and WPCRA have entered into numerous financial obligations, which include the following:

Tax Increment Revenue Bonds - WPCRA has issued un-validated bonds totaling $111,000,000 (balance as of September 2007) for the purposes of funding various Redevelopment Projects within WPCRA that fbrther the Redevelopment Plan. Debt service on the bonds are payable solely from WPCRA's FS 163.387 Redevelopment Trust Fund monies. The Redevelopment Projects are currently in the design phase or under construction.

Interlocal Obligations - The City has entered into financial obligations totaling $45,760,000 (balance as of September 2007) for the purposes of funding various Redevelopment Projects within WPCRA that further the Redevelopment Plan. Debt service on the financial obligations are payable through an Interlocal Agreement between the City and WPCRA. In the Interlocal Agreement, the CRA has promised to pay to the City, from WPCRA's FS 163.387Redevelopment Trust Fund monies, amounts sufficient to meet debt service on the City's financial obligations.

Development Agreements - WPCRA has entered into various Development Agreements with annual obligations approximating $2,500,000 for the purposes of spurring redevelopment and eliminating blight including the provision of

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public parking. Funding due under the Development Agreements are payable solely from WPCRA's FS 163.387 Redevelopment Trust Fund monies.

Additionally, WPCRA has allocated millions towards property acquisition and redevelopment initiatives to assist in the financial viability of numerous Redevelopment Projects, including transit-oriented developments, which will most likely require some form of financial assistance including a multi-year pledge of WPCRA's FS 163.387 Redevelopment Trust Fund monies. The initial opinion potentially jeopardizes WPCRA's ability to enter into the financing arrangements necessary to carry out its goals under the Redevelopment Plan.

Significantly, WPCRA does not have ad valorem taxing power. WPCRA bonds are payable from tax increment revenues received from taxing authorities and the bondholders cannot compel the taxing authorities contributing tax increment to exercise their ad valorem taxing power or taxation in any form of real or personal property to make payments on the bonds. The risk of insufficient tax increment revenues to pay for the bonds remains with the bondholders, not the taxpayers.

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Florida RedevelopmentAssociation BONDING SURVEY

September 2007

CRA Amount?

Boca Raton Boynton Beach Boynton Beach Bradenton Bradenton Charlotte County Clearwater Collier County Collier County Daytona Bch Shores Delray Beach Delray Beach Delray Beach Delray Beach Destin Flagler Beach Fort Myers Fort Pierce Groveland Holly Hill Hollywood Hollywood Hollywood Jacksonville Beach

,I

Kissimmee Lake Worth Lauderdale Lakes Leesburg Maitland Margate Margate Miami Beach New Port Richey New Port Richey New Port Richey North Miami North Miami Beach

Issue Date

2004 NA

2006 Pending

2006 NA

1999 2004 2004 2005

Pending 2005

05 - 07 2006 2005 2007 2006 2004 2003 2003 2003 2003 2003 2003 2003 2005

2007 Pending

2005 2006 2006 2005 2005 2006 2005 2007 2007

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Florida Redevelopment Association BONDING SURVEY

September 2007

Issue CRA Amount? Date

Orlando Orlando Orlando Orlando Palm Bay Palmetto Panama City Beach Pinellas Park Plant City Port Orange Port Orange Port St. Lucie Port St. Lucie Rockledge Saint Johns County Satellite Beach Sebring Airport Sebring Airport South Daytona South Miami Tampa Westgate Belvedere West Palm Beach West Palm Beach West Palm Beach Winter Garden Winter Park

TOTAL

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