Counties must pay property taxes on land they own outside their borders, the Florida Supreme Court ruled Thursday, putting to rest a nearly decadelong dispute between two Tampa Bay counties.
The case centered on 12,400 acres of ranch land that Pinellas County started acquiring in north Pasco County in the 1970s. Collectively known as the Al Bar and Cross Bar ranches, the land was initially bought by Pinellas for the groundwater below, and the regional utility Tampa Bay Water now owns the wells there while Pinellas harvests timber and pine straw.
Pinellas paid property taxes to Pasco for decades, but an internal audit in the early 2010s suggested that it was immune to the taxation. Pinellas stopped paying taxes. Pasco objected, and Pinellas sued in 2015.
A circuit court judge sided with Pinellas, but the Second District Court of Appeal overturned the ruling in 2019, saying that two different counties can’t claim immunity from taxes in the same place. Only Pasco can claim immunity in Pasco county. One judge summed it up by quoting a famous line from the 1986 film “Highlander”: “There can be only one.”
The appeals court had it right, the Supreme Court held in its 4-2 ruling Thursday. In the main opinion, Justice Jamie Grosshans wrote that “neither history, nor our precedent, support Pinellas County’s position.” She was joined by justices Jorge Labarga, John Couriel and Renatha Francis. Chief Justice Carlos Muñiz and Justice Charles Canady dissented. The court’s newest justice, Meredith Sasso, didn’t participate in the ruling.
“I’m very pleased with court’s decision,” Pasco County Tax Collector Mike Fasano said. “It’s one less thing that the property appraiser and tax collector have to deal with.”
A Pinellas County spokesperson said Thursday that the county attorney’s office was unavailable for comment but provided an analysis of the ruling that attorneys prepared for county commissioners.
Pinellas’ argument hinged on its interpretation of sovereign immunity, the legal doctrine that limits lawsuits against the government and generally exempts governments from having to pay most property taxes. Without a county-versus-county precedent to point to, the Supreme Court’s majority pointed to cases involving states and nations that owned property outside their borders. In those cases, sovereign immunity didn’t hold.
In 2022, while the Supreme Court was hearing arguments in the case, Pinellas officials publicly proclaimed that a broad ruling in the case could throw all of sovereign immunity into chaos. If the court found that it lost its tax-related immunity outside its borders, they asked, would it also mean the end of its immunity against lawsuits for things that happen in other counties?
The Florida Association of County Attorneys raised the same concerns in a brief urging the court’s caution. Though the group didn’t take a side in the ranchland dispute, it said that lifting limitations on lawsuits would be “flinging wide the doors of the county’s treasury.”
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Explore all your optionsGrosshans appeared to address that concern in a footnote: “Since our opinion is limited to taxation, we express no view on case law involving sovereign immunity in other contexts.”
The ruling was narrower than the one offered by the appeals court and avoided the broad scope Pinellas worried about, county attorneys said in their analysis.
“While the County did not prevail, the express limitation of the sovereign immunity analysis to tax immunity is a positive takeaway, not just for Pinellas County, but for all local governments,” the analysis said.
Emily Anderson, an executive coordinator for the Florida Association of Counties who serves as the staff for the county attorneys’ association, said she was unavailable to comment Thursday.
Though Pinellas went years without paying taxes to Pasco, it no longer owes money on the ranchland. It restarted regular payments in 2020, after the appeals court ruling. And last year, under threat of Pasco putting the tax-delinquent properties to auction, it paid its remaining back taxes.
Those years of unpaid taxes “cost Pinellas County tens of thousands, if not $100,000 or more, in penalties and interest,” Fasano said.
