Florida Supreme Court Chickens Out
Sunday, September 28th, 2008About a year ago, on Septemeber 25, 2007, we blogged about the Florida Supreme Court decision in Strand v. Escambia County, 2007 Fla. LEXIS 1598, holding that under the Florida Constitution, government bonds required a referendum, so that TIF bonds could not be issued in the future without one. As you can imagine, there was a great hue and cry from the government folks who — horrors! — were now facing an obligation to get the voters’ approval and couldn’t just spend the taxpayers’ money on their own say-so. As we noted, the Florida Supreme Court responded by granting rehearing. Now the new opinion has come down. Strand v. Escambia County, 2008 Fla. LEXIS 1745, filed on September 28, 2008.
The court flipped on this one and this time, affirmed the lower court decision upholding the bond issuance without their validation in a referendum. Chief Justice Quince dissented, characterizing the majority’s decision as supportive of a “local-government shell game, which is played to avoid the Florida voter.”
So it’s business as usual in Florida: the government can spend fortunes and put the taxpayers in hock up to their ears without giving them an opportunity to decide for themselves whether they think that the promised benefits are worth the financial burden. In a country that is sinking in public and private debt anyway, that’s something to ponder somberly. Rememeber that these are typically 30-year bonds, so that when they mature and the time comes to pay them off (or to face default, as the case may be) the politicians who issued them will have gone to their reward or out of office. So either way, there is nothing the taxpayers can do. The pols can just borrow and spend without giving the proverbial rat’s patoot about the soundness of the schemes financed by them or the long-term state of the public treasury.
A related thought. Out here in la-la land, redevelopment bonded indebtedness has gone from $5.3 billion in the 1984-1985 fiscal year to $41.8 billion in 1996-1997. It will be interesting to see how this debt is paid off if the current market foofaraw results in a decline in property tax revenues. Stay tuned.