Florida golf course fights to stay tax-exempt

In resolving a case that’s taken more turns than a car on a California mountain road, the Florida Supreme Court has weighed in on the side of Gulf Breeze in a years-old legal dispute pitting the city against the Santa Rosa County Property Appraiser’s Office over the tax-exempt status of Pensacola’s Tiger Point Golf Club.

It was in 2016 that Property Appraiser Greg Brown’s office first challenged the exempt status of the golf course.

The course first came into the hands of Gulf Breeze in 2012 when the city purchased it with the primary motivation of using it as a place to dispose of treated wastewater effluent coming from its sewage treatment facility.

It was run as a municipal course until late 2015 and enjoyed government tax-exempt status unchallenged for three years.

But after the city brought on a private for-profit company called IGC to manage the golf course and its amenities − which included a restaurant − questions arose over whether the agreement amounted to a lease, and in 2016 the Property Appraiser sent a tax bill.

The city questioned the action and took its case to a Value Adjustment Board, which reversed the exemption denial, finding the agreement between Gulf Breeze and IGC was a “management contract” as opposed to a lease. The Property Appraiser’s Office sought review by bringing an action in Circuit Court.

The Property Appraiser also denied the city’s application for exemption for the golf course in 2017. In doing so, it expanded its arguments for denial in part by arguing the property was being used as a “governmental proprietary function” rather than a “governmental-governmental function,” the Supreme Court’s summary of court events said.

In the consolidated cases, the Circuit Court granted final summary judgment in favor of the city, and agreed in its findings with the VAB, holding the agreement with IGC was a management agreement and not a lease. It ruled the 2016 and 2017 exemptions were valid.

The Property Appraiser appealed the Circuit Court’s decision and in 2022, the First District Court of Appeal sided with his office. It also posed a certified question for the Supreme Court to answer.

“Is a city’s public golf course still being ‘used exclusively by it for municipal or public purposes,’ so that it remains tax exempt … if the city turns the course and its appurtenant facilities over to a private business to operate and manage for the business’s own profit or loss in return for an…