HomeMy WebLinkAboutReso 2008-1361
RESOLUTION NO. 2008- r3lo\
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
SUNNY ISLES BEACH, FLORIDA, APPROVING A
SETTLEMENT AGREEMENT WITH THE MIAMI-DADE
COUNTY PROPERTY APPRAISER'S OFFICE FOR PAYMENT
OF AD VALOREM PROPERTY TAXES FOR THE TAX YEARS
2006 AND 2007 FOR THE PROPERTY LOCATED AT 19200
COLLINS AVENUE; PROVIDING THE CITY MANAGER AND
THE CITY ATTORNEY WITH THE AUTHORITY TO DO ALL
THINGS NECESSARY TO EFFECTUATE THIS RESOLUTION
AND THE SETTLEMENT AGREEMENT; PROVIDING FOR AN
EFFECTIVE DATE.
WHEREAS, the City of Sunny Isles Beach (the "City") and the Miami-Dade County
Property Appraiser's Office ("Property Appraiser") have reached a settlement agreement for the
payment of ad valorem property taxes for the property located at 19200 Collins A venue: and
WHEREAS, the Property Appraiser has agreed to grant the City a fifty percent (50%)
reduction in the assessed ad valorem property taxes for the property for the tax years 2006 and
2007: and
WHEREAS, the Property Appraiser has further agreed to extend the 50% tax reduction
for the property for the current tax year 2008.
WHEREAS, the City desires to enter into a settlement agreement with the Property
Appraiser in order to receive a 50% reduced tax exemption for the property as more fully set
forth in the attached Exhibit "A".
NOW THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA, AS FOLLOWS:
Section I. Incorporation of Settlement. The recitals set forth hereinabove are hereby
incorporated herein by reference.
Section 2. Approval of Settlement Agreement. The City Commission hereby approves the
Settlement Agreement with the Property Appraiser attached hereto as Exhibit "A ".
Section 3. Authorization of the City Manager and City Attorney. The City Manager and
the City Attorney are hereby authorized to do all things necessary to effectuate this Resolution
and the Settlement Agreement.
Section 4.
Effective Date. This Resolution shall become effective upon adoption.
R200X- Approval or Settlement Agreement with Property Appraiser Page I or 2
PASSED AND ADOPTED this / 8~
ATTEST:
~Ar~
Jane A. Hines, City Clerk
APPROVED AS TO FORM
AND LE L- FFICIENCY:
Ins
Vote: '-\ -0- \
Mayor Edelcup
Vice Mayor Thaler
Commissioner Goodman
Commissioner Brezin -- ~
Commissioner Scholl
Moved by YICJ} ~ I r\l\1...'tR
Seconded by: ~~\Ot0T.e Sc.\-\,oLL
0Y es)
V(Yes)
0Yes)
(Yes)
~es)
(No)
(No)
(No)
(No)
(No)
R2008- Approval of Scttlcmcnt Agrccmcnt with Propcrty Appraiscr Pagc 2 of 2
_DADE.
Department of Property Appraisal
Administrative Division Suite 710
111 NW 1 ST.
Miami F133128-1984
VALUATION ADJUSTMENT BOARD PETITION WITHDRAWAL AGREEMENT
ASSESSMENT/TAX YEAR 2007
To:
Folio
31-2202-011-0040
Agenda Number
07 -51507
Dear Mr. Ottinot:
Please be advised that your petition filed with the Dade County Valuation Adjustment Board contesting
the value(s) of the referenced property has been reviewed by this department. As a result of this review, the
following recommendation is being proposed:
REAL PROPERTY
MARKET VALUE ASSESSED VALUE EXEMPTION
PRELIMINARY 2007 $12,447,325 $12,447,325 $0
VALUE RECOMMENDATION 2007 $10,810,500 $10,810,500 $5,405,250
Additionally, this proposed recommendation requires that the taxpayer waive any further Rights of appeal
before the Valuation Adjustment Board and Circuit Court with respect to the Market and/or assessed value of
the referenced property. If you agree with the proposed recommendation, please sign and date where
indicated below.
The Property Appraiser reserves the right to withdraw the proposed recommendation offer at any time prior to
acceptance by the taxpayer and proceed with the Value Adjustment Board Hearing scheduled for the referenced
property.
Marcus Saiz, Property Ap~~r
Reviewed By: ?~~
Supervisor: ).~ 1----.
/ ~
To: Dade County Property Appraiser and Valuation Adjustment Board
I hereby accept the proposed recommendation indicated above regarding the market and/or assessed valuation
of the referenced property; and I hereby withdraw the related petitior,(s) previously filed with the Valuation
Adjustment Board, acknowledging that such withdraw I onstitutes a waiver of any further rights of appeal. I
further acknowledge I am fully authorized to e cu e t i acc ance on behalf of the taxpayer.
(sign)
~t holrrint)
Dete, /1"J-70 b Texpey,,/Ageo
Exhibit "A"
CITY OF MIAMI BEACH, Plaintiff, v. JOEL W. ROBBINS, etc., et al., Defendants. Cir... Page 1 of 3
12 Fla. L. Weekly Supp. 650a
Taxation -- Ad valorem -- Exemptions -- Municipal property -- Challenge to value adjustment
board decision upholding property appraiser's denial of municipal property tax exemption for
city-owned parking garage -- Lease of retail space in parking garage building, granting priority
access to parking spaces to hotel and inclusion of private companies in sharing profits from garage
operation are private for-profit uses that do not qualify as serving governmental-governmental
purpose necessary to qualify for municipal property tax exemption -- Private uses of garage by
retail stores and two hotels are not merely incidental -- No merit to argument that hotels' uses
should be discounted because they are not granted by leases where uses granted by easements and
covenants running with land do not eliminate private use of property and convey greater and
more secure property interests than would be conveyed by leases -- Summary judgment granted
in favor of property appraiser -- Section 194.301 does not affect presumption of correctness of
property appraiser's decision to grant or deny exemptions, as statute "relates to valuations made
by property appraiser and not exemptions or categorizations"
CITY OF MIAMI BEACH, Plaintiff, v. JOEL W. ROBBINS, etc., et al., Defendants. Circuit Court,
11 th Judicial Circuit in and for Miami-Dade County, General Jurisdiction Division. Case No. 02-31177
CA 06. March 31,2005. Jeri B. Cohen, Judge. Counsel: Robert T. Datorre and Gary Held, Assistant
City Attorneys, Miami Beach, for Plaintiff. Robert A. Ginsburg, County Attorney, and Thomas W.
Logue, Assistant County Attorney, for Property Appraiser. Mark T. Aliff.
ORDER GRANTING FINAL SUMMARY JUDGMENT
This matter came for hearing on March 30, 2005 on the parties' cross-motions for summary judgment.
This case raises the question whether a certain parking garage owned by the City of Miami Beach is
entitled to a municipal property tax exemption for tax year 2001. The City applied for such exemption,
the Property Appraiser denied the exemption, the City filed a petition challenging such denial before the
Value Adjustment Board, and the Value Adjustment Board upheld the Property Appraiser's decision.
The City then filed the instant case, challenging the denial of its application for an exemption.
The subject property, known as the" 16th Street Parking Garage," is a six story parking garage built in
1998 and located at 1550 Collins A venue on Miami Beach. It contains approximately 800 parking
spaces and 261,800 square feet. On the ground floor, the subject property has approximately 20,752
square feet ofretail sales space fronting on Washington A venue, Collins A venue, and 16th Street.
At all times relevant to this lawsuit, the City has offered the 20,752 feet of retail space for rent to private
companies and has leased the space to various for-profit enterprises including a bar and grill, a liquor
store, and imported clothing stores. In addition, the City has granted the Loews' Hotel, a privately owned
and operated for-profit hotel, an Easement and Covenant running with the land. Among other things, the
Easement and Covenant allows Loews to share in the profits from the operation in the garage. In
particular, it provides that Loews shall pay an annual Garage Usage Fee of $550,000 and receive in
return 41. 7% of the first $1,320,000 of Gross Parking Revenues and 28% of such revenues over
$1,320,000.
The Easement and Covenant also grant Loews "priority access" to 560 out of the 800 existing parking
spaces. Regarding the Hotel's "priority access" to parking, the Easement and Covenant provides that, if
the Hotel's patrons are unable to use the spaces because they are occupied by parking by members of the
general public, the Hotel can require the City to mark the spaces for the exclusive use of the Hotel and to
hire a towing company to remove violators. A similar Easement and Covenant was granted to the Royal
http://www.floridalawweekly .com/newsystem/showfile. php?fromsearch= 1 &file= ../supfil... 11/26/2008
CITY OF MIAMI BEACH, Plaintiff, v. JOEL W. ROBBINS, etc., et aI., Defendants. Cir... Page 2 of 3
Palm Hotel, although that agreement recognized Loews' priority access to the first 560 spaces and
provided for a lower usage fee and lower share of revenues from garage operations.
The Florida Constitution provides that municipal property shall be exempted from taxation only if it
owned by a municipality and "used exclusively by it for municipal or public purposes." Article VII,
section 4, Florida Constitution. As the Official Commentator to the Constitution explained, "[I]n order
to qualify for the constitutional mandatory municipal exemption, property must (1) be owned by a
municipality and (2) be used exclusively by the municipality for either municipal or public purposes. . .
." Id., Commentary. Art.VII, section 3, Fla. Const. (West Stat. Ann. 1995).
To qualify as a municipal or public purpose the subject property must be used for a "governmental-
governmental" purpose and not merely for a "governmental-proprietary" purpose. See, e.g., Sebring
Airport Authority v. McIntyre, 642 So. 2d 1072, 1073 (I 994). This standard reflects the changes
concerning municipal exemptions made by the 1968 Constitution. See, e.g., Williams v. Jones, 326 So.
2d 425, 433 (Fla. 1975). In Williams, the Supreme Court emphasized that the 1968 Constitution required
that "all property used by private persons and commercial enterprises is subjected to taxation. . . . . Thus,
all privately used property bears a burden in some manner and this is what the Constitution mandates."
326 So. 2d at 433. The private uses of the garage described above clearly do not qualify as serving a
governmental-governmental purpose.
The City suggested that the term "public purpose" be given the more relaxed meaning that it has in the
context of revenue bonds and eminent domain. This argument, however, was rejected by the Supreme
Court as recently as 2001 in Sebring Airport Authority v. McIntyre, 783 So. 2d 238, 250-51, n. 15 & 16
(Fla. 2001). The Court explained that the stricter standard was required because "any newly-created tax
exemption necessarily involves a direct shift in tax burden from the exempt property to other non-
exempt properties." 783 So. 2d at 250.
The City also suggested that the private uses of the garage by the retail stores and the "two Hotels are
merely incidental. The Court finds, however, that the lease of 20,000 square feet of retail space, the
granting of "priority access" to 560 out of 800 parking spaces, and the inclusion of private companies in
sharing profits from the operations of the garage are private, for-profit uses too substantial to qualify as
incidental. The City also suggests that the Hotels' uses should be discounted because they are not
granted by leases. The Hotels' uses, however, are granted by Easements and Covenants running with the
land which do not eliminate the private use of the property and, if anything, convey to the Hotels greater
and more secure property interests in the garage than would be conveyed by leases.
In deciding this matter, the Court must take into consideration the fact that the Court is reviewing a
decision of a Constitutional officer in the area of his discretion. For this reason, the Property Appraiser's
determination to grant or deny an exemption is entitled to a presumption of correctness. Straughn v.
Tuck, 354 So. 2d 368, 371 (Fla. 1977); Markham v. June Rose, 495 So. 2d 865 (Fla. 4th DCA 1986).
The Taxpayer's heavy burden in this case is to exclude every reasonable hypothesis that would support
the Property Appraiser's conclusion that the property is not exempt. See, e.g., Straughn, 354 So. 2d at
371. This burden was not altered by the enactment of Section 194.301 of Florida Statutes because the
bill creating that section was specifically amended to clarify "that the bill relates to valuations made by
the property appraiser and not exemptions or categorizations." Bill Analysis & Economic Impact
Statement for HB 445, House Finance & Tax Committee (Fla. March 11, 1997).
For the above-stated reasons, the Court upholds the decision of the Property Appraiser to deny a
municipal tax exemption to the subject property. Accordingly, the Court grants the Property Appraiser's
Request for Judicial Notice, grants the Property Appraiser's Motion for Final Summary Judgment and
denies the City's Motion for Summary Judgment. Final judgment is hereby entered for the Property
hrtp://www.floridalawweekly .com/newsystem/showfile. php?fromsearch= 1 &file=. ./supfil... 11/26/2008
CITY OF MIAMI BEACH, Plaintiff, v. JOEL W. ROBBINS, etc., et aI., Defendants. Cir... Page 3 of 3
Appraiser and against the City and the Property Appraiser shall go hence without day. The Court
reserves jurisdiction to tax costs.
* * *
http://www.f1oridalawweekly .com/newsystemlshowfile. php?fromsearch= I &file=. ./supfil... 11/2612008
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
(305) 947-0606 City Hall
(305) 949-3113 Fax
(305) 947-2150 Building Department
(305) 947-5 107 Fax
City Commission
Norman S. Edeleup, Mayor
Lewis .J. Thaler, Vice Mayor
Roslyn Brezin. Commissioner
Gerry Goodman, Commissioner
George "Bud" Scholl. Commissioner
A. John Szerlag, City Manager
/lalls Ottinol. City Attorney
.Jane A. Hilles, CMC, City Clerk
MEMORANDUM
TO:
FROM:
The Honorable City commissm%:
Hans OUinot, City Attorneyw '-l
December 18,2008
DATE:
RE:
Resolution approving a tax settlement agreement with the Miami-Dade County
Property Appraiser's Office for the property located at 19200 Collins Avenue
RECOMMENDATION:
It is recommended that the City Commission approve the attached Resolution approving a tax
settlement agreement with Miami-Dade County for the property located at 19200 Collins Avenue.
REASONS:
As you may know, the City Attorney's Office has been involved in lengthy settlement negotiations
with the Miami-Dade County Property Appraiser's Office regarding the property located at 19200
Collins A venue. The City purchased this property to be used as open space and developed as a public
park. Towards that end, the City approved a covenant requiring the land to be used for park purposes
in perpetuity and applied for an ad valorem tax exemption with Miami-Dade County. However, the
Property Appraiser's Office denied the City's requested tax exemption, concluding that the property
was not used "exclusively" for governmental purposes under Chapter 196, Florida Statutes, because the
City is allowing the Marco Polo Hotel to use the property for parking purpose. The settlement reduces
the City's tax liability by fifty percent (50%).
Realizing that the law favors the Property Appraiser's Office, a settlement was the best course of
action. Specifically, the Miami-Dade County Circuit Courts have taken a very restrictive view of what
constitutes an "exclusive" governmental use in order to qualify for a property tax exemption.
Moreover, the Property Appraiser's determination to grant or deny an exemption is entitled to a
presumption of correctness by the court. For example, in the case styled City of Miami Beach v.
Robbins, 12 Fla. L. Weekly Supp. 651 a (Fla. 11 th Circ. Ct. March 31, 2005), the court upheld the value
adjustment board's decision upholding the property appraiser's denial of a municipal property tax
exemption for a city owned parking garage. The court reasoned that the city's parking garage was not
used "exclusively" by the city for municipal or public purposes. Accordingly, the court upheld the
Property Appraiser's decision to deny the city a municipal tax exemption for the property.
Agenda Item ~ 0 \
Date I 2 - \ ~ ' 0 2
This proposed settlement agreement with Miami-Dade County may save the City an estimated amount
of$201,055.38 (Two Hundred One Thousand Fifty Five Dollars and Thirty Eight Cents) in ad valorem
property taxes. Importantly, the City will continue to receive a 50% tax exemption for the property for
the 2008 tax year.
The City Attorney's Office believes this proposed settlement agreement strongly inures to the benefit
of the City. For this reason, it is recommended that the City Commission approve and adopt the
attached Resolution approving the tax settlement agreement with the Miami-Dade County Property
Appraiser's Office.
/ Attachment
TO:
FROM:
DATE:
RE:
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
(305) 947-0606 City Hall
(305) 949-3113 Fax
(305) 947-2150 Building Department
(305) 947-5107 Fax
City Commission
Norman S. Edelcup, Mayor
Lewis J. Thaler, Vice Mayor
Roslyn Brezin, Commissioner
Gerry Goodman, Commissioner
George "Bud" Scholl, Commissioner
A. John Szerlag, City Manager
Hans Ottinot, City Allorney
Jane A. Hines, CMC, City Clerk
MEMORANDUM
Hans Gttinot, City Attorney
Jane A. Hines, CMC, City Clerk ~ f\ ~
December 24, 2008
Approval of Agreements
At its regular meeting of December 18, 2008, the City Commission adopted the following
Resolutions:
. Resolution No. 2008-1360 Approving an Agreement with Barthet Firm;
. Resolution No. 2008-1361 Approving a Settlement Agreement with the County
Property Appraiser's Office; and
. Resolution No. 2008-1362 Approving a Non-Binding Agreement with LSB
Investment.
Enclosed is a copy of each of the adopted Resolutions for your handling.
Thank you.
Attachments
cc: Doug Haag, Assistant City Manager/Finance
Memo I-lans Ottinot Re Resolutions Approved 121808