Senate passes bill enabling businesses to sue local governments, halt ‘arbitrary or unreasonable’ ordinances

TALLAHASSEE, FLA. 2/10/23-Sen. Travis Hutson, R-St. Augustine, left, is congratulated by Sen. Jay Trumbull, R-Panama City, after Hutson’s Intercollegiate Athlete Compensation and Rights bill passed the Senate, Friday at the Capitol in Tallahassee. COLIN HACKLEY PHOTO

Businesses in Florida are now one step closer to having a state-sanctioned path to sue local governments and halt enforcement of ordinances that hurt their bottom line.

The Senate passed legislation (SB 170) Wednesday that would hand businesses new tools to fight what they deem to be harmful oversteps by counties and cities.

Critics blasted the bill as a litigious tarpit that will open governments across Florida to frivolous lawsuits. Proponents like Plant City Republican Sen. Jay Trumbull, the measure’s sponsor, have labeled it the preemption to end all government preemptions and say it’s a much-needed check on careless rulemaking.

“We come up (to Tallahassee) year after year and there are preemption bills,” he said. “Our hope is that through this particular piece of legislation that there will be no more … and it gives local governments an opportunity to hit the pause button, see what they’re doing and maybe see if the ends justify the means on (an) ordinance.”

If it becomes law, SB 170 will enable companies to sue county and city governments that pass “arbitrary or unreasonable” ordinances that harm profits for up to $50,000. While a court decides the legitimacy of that claim on a fast-tracked basis — a provision called “rocket docket” — the local government would have to suspend enforcement of the ordinance in question.

If the ordinance is ultimately deemed to be “valid and enforceable,” governments would still have to wait 45 days from that judgment to resume enforcement. And that process again is interrupted if the plaintiff obtains a stay of the lower court’s order or another business files suit over the same issue.

Asked by Democratic Sen. Tracie Davis of Jacksonville to define “arbitrary or unreasonable,” Trumbull said the term covers any local measure “that fails to pass the courts’ lowest standards and one that does not have a rational relationship to a legitimate government interest.”

The bill would also require county and city legislative bodies — Commissions, Councils and the like — to produce and post to the government website a “business impact statement” during the drafting phase of the ordinance. The document must include ample information about the proposed ordinance, including its estimated economic impact on for-profit businesses, how many businesses it will affect and the enforcement cost.

Emergency ordinances or measures to adopt budget amendments, comply with federal or state law, or the issuance and refinancing of debt would be exempted. Local governments would also have the final say on rules relating to their growth policy and planning and development regulations, including zoning and development orders, agreements and permits.

Ironically, SB 170 would not extend to the state government, which is shielded by a centuries-old doctrine called sovereign immunity that prevents governments from lawsuits.

Senators passed the bill at around 7 p.m. on an almost exclusively partisan line. St. Petersburg Rep. Darryl Rouson was the only Democrat to vote “yes.”

The bill’s applications and implications are myriad. Critics have cited its potential to occlude government oversight of everything from neighborhood noise ordinances, bans on single-use plastics and limiting the size of vessels calling on seaports to efforts localities have made to stymie predatory landlord practices through tenant bills of rights.

Trumbull confirmed SB 170 would also extend to local living wage ordinances “unless there’s a contract.”

Miami Sen. Jason Pizzo, a lawyer and former prosecutor, noted the bill stipulates that upon losing a legal challenge, local governments must cover the plaintiff’s attorney’s fees; however, if the government prevails, the business that brought forth the lawsuit would face no such liability. He asked why the bill was written that way, since the lack of financial penalties for businesses challenging the ordinance in court, in essence, practically invites vexatious litigation.

Trumbull said it’s to help businesses, which can already sue governments for assumed damages to profit but may not otherwise be able to hire lawyers to represent them.

“The reality is when there is an ordinance that is egregious, arbitrary, unreasonable (or) already prevented by the state, (the governments) should lose,” he said. “But our sincere hope and most sincere desire is that it never ends up in court.”

Several industry and advocacy groups, including the Florida Association of Counties and Florida League of Cities — backed the legislation, as they and several others did its Senate and House versions last year by St. Johns County Sen. Travis Hutson and Cape Coral Rep. Mike Giallombardo.

This year, Republican Rep. Robert Brackett, a former Mayor of Vero Beach, filed the bill’s House analogue (HB 1515).

Other groups, including Progress Florida and Sierra Club Florida, have condemned the measure as placing the financial burden on taxpayers to defend against for-profit corporations for passing local laws that serve the unique needs of their communities.

They point to similar legislation from last year (SB 620), a top priority of then-Senate President Wilton Simpson, which Gov. Ron DeSantis vetoed after it cleared both chambers of the Legislature.

DeSantis pointed to the “broad and ambiguous language” of SB 620 as potentially troublesome and disagreed with its exemption of emergency orders that led to “bizarre and draconian measures adopted by some local governments during COVID-19.”

Trumbull’s bill would supersede those types of local emergency dictates.