Appeal court asks Gainesville, GRU Authority to clarify new Florida law

The Florida Legislature had its say concerning House Bill 1451 in March, with Democratic Party members challenging why an amended section of the bill seemed to target the Gainesville Regional Utilities (GRU) Authority.

Now, the city of Gainesville and the GRU Authority have taken their turns, filing two supplemental briefs with the Florida First District Court of Appeal. The final brief came Monday after the court asked both sides to address House Bill 1451, which Gov. Ron DeSantis signed into law on June 12, and how it impacts the lawsuit currently on appeal.

The city of Gainesville said the new law has no effect on the current case; the GRU Authority said the law explicitly adds another reason to rule in its favor.

The court’s agreement with one side versus the other could change who manages GRU—the City Commission, as it had for decades before, or the authority as installed by the Legislature in 2023.

“Pitted against the Legislature’s plenary power, the City’s attempt to shutter the Authority fails,” the GRU Authority brief said. “The new law confirms that conclusion and forecloses any contrary result.”

Meanwhile, the city argues the bill’s preemption section fails to apply retroactively.

“Florida law requires a clear expression of retroactive intent before a substantive statute may be applied to past events. Section 4 contains none,” the Gainesville brief said.

With the briefs submitted, the appeal court has no timeline to decide the case and could rule at any time.

Appeal case background

The case concerns the 2024 referendum the City Commission placed on the ballot. It asked voters whether to remove Section 7 from the city charter, thereby eliminating the Legislature-created and governor-appointed GRU Authority. And 72% of voters said yes.

But the GRU Authority argued from the beginning that the City Commission lacked the power to hold such a referendum, since it would undo a special act of the Florida Legislature.

The courts postponed any changes until it could answer that question.

The GRU Authority and city of Gainesville debated the issue in February before the Legislature threw a curveball.

House Bill 1451 made waves in Gainesville after a 24-word section was added at the final committee stop. The section reads: the subject of a regional utilities authority created by the Legislature through charter amendment after January 1, 2023, is expressly preempted to the state.

The only current utility that fits this definition is GRU. Gainesville officials and local organizations argued against the section and criticized its late addition to the bill (at the final committee). GRU Authority lobbyists signed up to support the legislation.

Gainesville’s arguments

Foremost, the city of Gainesville said section 4 of chapter 2026-135, Laws of Florida, looks forward in its preemption, not backward or retroactively.

The city’s attorneys said that the Legislature needed to write that the preemption applied retroactively or to pending cases.

“Florida law presumes that statutes operate prospectively unless the Legislature clearly expresses a contrary intent,” the brief said.

Gainesville’s attorneys said that the operative events in the case were when the City Commission authorized the referendum, when voters approved the referendum and when the lower court issued a final judgement on the case. All of those happened over a year before the new law went into effect.

“Accordingly, applying section 4 to reverse or disturb the judgment would be retroactive,” the brief said. “It would attach a new legal consequence to completed acts by treating those acts as unauthorized, preempted, void, or legally defective under a statute that did not exist when they occurred.”

The city clarified that the Jan. 1, 2023, date in section 4 isn’t that date where the new law starts taking effect. Instead, the date identifies which regional utilities would be impacted.

In a second argument, the city said the preemption fails to prevent a referendum from moving forward, saying the section doesn’t remove a city’s referendum powers. An idea condemned in the GRU Authority brief.

Lastly, if the GRU Authority argues that section 4 applies retroactively, then the city’s attorneys said it would constitute a special law disguised as a general law—a prohibited legislative drafting technique according to past court cases.

A special law is not converted into a general law because the Legislature frames or passes it as a general law,” the city said. “A law that uses descriptive criteria to identify one local entity is special in substance.”

GRU Authority arguments

The attorneys for the GRU Authority reiterated its past arguments before the lower court and appeal court, adding that HB1451 now serves as another concrete reason to throw out the referendum.

“The [charter referendum] was unconstitutional before the new law both because the City lacked any power to abolish a legislatively created regional utilities authority and because the City’s effort to do so irreconcilably conflicted with the state law creating, empowering, and regulating the Authority,” the brief said.

The brief said that the appeal court can apply the new law retroactively or not, either way the GRU Authority remains in control of the utility. The attorneys said the new law “undoes nothing already done” since the utility authority remains in operational control and all past referendums have been halted for review.

The GRU attorneys also countered the idea that the section 4 wouldn’t preclude future referendums to dissolve a regional utilities authority. The section specifically prohibits direction or control, and destruction is the ultimate act of control.

“A city that may not direct the Authority is not free to destroy it,” the brief said. “Nor does labeling the mechanism of destruction a ‘charter amendment’ move it outside the preempted field.”

The authority also dismissed the idea that section 4 of HB 1451 is a special law disguised as a general law.

“Section 4 bears the hallmarks of a general law. It (1) identifies and applies uniformly to a class that remains open into the future and (2) regulates an important subject of statewide concern—the provision of utilities, including water and power,” the brief said.

For a full history of the GRU Authority and the arguments surrounding it, check out Mainstreet’s 39-month timeline from Gainesville’s audits in 2023 to the preemption last month.