Must one municipality pay property taxes on land in owns in another municipality? Pasco County says yes. Pinellas County says no.
A Pasco Circuit Court ruled for Pinellas County. The Second District Court of Appeal later overturned that decision on behalf of Pasco County.
Now, the Florida Supreme Court will decide which county is right in a case being closely watched by local governments across the state.
In a brief filed Friday, Pinellas County attorneys argued the county is “immune” from paying property taxes on 12,439 acres it owns in neighboring Pasco County because it is a political subdivision of the state and the land is being utilized for a public use – watershed conservation.
Pinellas County purchased the 8,200-acre Cross Bar Ranch in 1976 and the adjacent 4,200-acre A1 Bar Ranch in 1989 for water well field development.
The county sold the 17 wells and water it developed on 6.41 acres in the mid-1990s as part of the reorganization that created Tampa Bay Water.
Pinellas County claims it was unaware it was paying property taxes on both parcels until a 2014 audit. It sued Pasco County in 2015, seeking to have its land removed from the tax rolls and reimbursement of past taxes it inadvertently paid.
A Pasco County Circuit Court last year ruled in favor of Pinellas County. In May, the Second Circuit of Appeal overturned the lower court in a 2-1 decision that said the county is not “immune” from property taxes.
“This case presents an issue of first impression: whether a county's immunity from taxation extends extraterritorially to property that it owns in another county. We conclude that it does not and reverse,” Judge J. Andrew Atkinson wrote.
Citing the Florida Supreme Court’s 1957 ruling in Park-N-Shop, Inc. v. Sparkman, which states a county's immunity from taxation does not apply in situations where one county is seeking such immunity of lands located outside of its jurisdictional boundaries, Atkinson added, “We agree.”
In the brief it filed last week, Pinellas County asks the Supreme Court to confirm its contention that the county is “immune from taxation on the property” and approve its demand for reimbursement of tax payments made for 2014 through 2016.
“Because each county’s sovereign immunity emanates not from the county itself but rather from the state, [Pinellas County] argues that property owned by a county anywhere in the state is immune from ad valorem taxation,” the filing reads.
Pasco County maintains long-standing “overlapping sovereignty” statutes in which “the sovereign acting outside of its territory must be treated as a private entity” clearly state Pinellas County’s land is not “immune” from Pasco County taxes.
As precedent, Pasco County cites the 1924 U.S. Supreme Court ruling in Georgia v. City of Chattanooga, which found Georgia was not “immune” from condemnation of land it owned in Tennessee.
In its arguments, Pasco County asked how Pinellas County would react if Pasco County purchased a hotel resort in St. Pete Beach and operated it as a for-profit business without paying property taxes.
In June, Pasco County Property Appraiser Gary Joiner said Pinellas County made more than $2 million from timber and pine straw harvesting on the property and, therefore, owes Pasco about $200,000 in taxes just for that.
The Supreme Court has not scheduled hearings for the case.