The Impacts of Lawsuits Against Local Governments for Business Damages

The “home rule” provisions contained in Florida’s Constitution afford broad powers to local governments, including the power to pass and enforce local ordinances. This broad home rule authority is limited by “preemption,” where the state or federal government has already legislated an issue, and standards of reasonableness. Local governments are precluded from passing ordinances that are inconsistent with the State Constitution or state or federal law, or that are unreasonable or arbitrary. Anyone who is adversely affected by a local ordinance may initiate a cause of civil action against the local government.

The 2022 Florida Legislature is debating two pieces of legislation that add to the process of passing local ordinances and provides additional rights to businesses and residents who wish to challenge those ordinances. Bills under consideration include:

SB620/CS/HB569 --- Authorizes businesses that have been operating in Florida for at least three years to bring suit against local ordinances that directly result in a 15 percent loss—or projected loss—of profit and recover damages. 

CS/SB280/HB403 --- Requires municipal and county governments to prepare a business impact estimate before the enactment of an ordinance; requires ordinances to be suspended if challenged as being preempted by the state or is arbitrary or unreasonable; and allows the courts to award attorney fees, costs, and damages to the complainant if it prevails. The two bills were identical when filed, but SB280 has been amended extensively, favorably addressing a number of stakeholder concerns.

Florida TaxWatch undertakes this independent review to better understand the potential impacts of this suite of legislation on local governments, Florida businesses, and on the Florida taxpayer.