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House panel moves bill to allow businesses to sue over lost income due to ordinances

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Rep. Lawrence McClure

Rep. Lawrence McClure

Over the strong objection of  cities and counties, a House panel has approved a measure that would give businesses a right to sue when a local ordinance hurts their bottom line.

The Civil Justice and Property Rights Subcommittee voted 12-3 on January 13 to approve HB 569 by Rep. Lawrence McClure, R-Plant City.

“It’s trying to persuade municipalities from displacing the success of our businesses,” McClure said.

The measure would create a cause of action for businesses if a local ordinance or charter amendment reduces the business’ revenue or profits by 15%. Some restrictions would apply.

Businesses would have to be operating three years or longer in Florida. Ordinances or charter provisions that are required to comply with state law would be exempt.

So would an emergency ordinance, declaration, or order adopted under the Emergency Management Act, or a temporary emergency ordinance in effect for 90 days or less.

At McClure’s urging, the committee approved an amendment that expanded the list of exemptions to include land-use ordinances, fire and building codes, and finance and budget amendments.

But that did little to ease the concerns of critics, some of whom call the measure the “mother of all preemption bills.”

Among their biggest concerns is a one-way attorney fee provision that would allow only businesses to recover attorney fees and costs if they prevail in the lawsuit.

Rebecca O’Hara, legislative advocate for the Florida League of Cities, warned that local governments would be left defenseless against predatory lawsuits.

“It creates a new tort, imposing strict liability on local governments, with no opportunity to cure the problem,” O’Hara said. “There’s really no downside to bringing a suit — if you get a demand letter, your only opportunity is to pay.”

Bob McKee, deputy director of public policy for the Florida Association of Counties, said the measure would allow any Florida-based business to sue any local government.

“Business is not required to be in the county where the ordinance was passed,” he said. “We cannot stand here today and tell you that this is the right public policy.”

McClure insisted that the legislation was merely designed to force local governments to consider the impact their decisions have on the small businesses that drive their economies.

Pressed for an example of how the measure would work, McClure cited a ban on gas-powered lawn equipment that some cities are proposing to mitigate global warming.

“If you’re a yard company, you have to dispose of all of your equipment,” he said.

Democratic lawmakers said the measure would bankrupt local governments or discourage them from making the tough decisions their constituents demand.

“I think what we’re hearing loud and clear for the last hour is a lawsuit bonanza against our municipalities and counties,” said Rep. Ben Diamond, D-St. Petersburg. “I think we have to stand against this bill and stand with our residents that we represent that want their trash to be picked up twice a week, that want their potholes filled.”

Rep. Carlos Guillermo Smith, D-Winter Park, asked what would happen if a local ordinance raised the profitability of nine businesses but reduced profits for one business.

“Does that mean we should not be passing policy for the greater good?”

HB 569 still faces hearings in the Local Administration & Veterans Affairs Subcommittee and Judiciary before reaching the House floor.

The Senate Judiciary Committee voted 7-4 on November 30 to approve a companion, SB 620 by Sen. Travis Hutson, R-Palm Coast. It faces one more hearing in Appropriations before reaching the Senate floor.

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