Judge rejects class-action suit over Hillsborough transportation tax

A Leon County Circuit Court judge has dismissed a class-action lawsuit that sought to divvy up nearly $570 million collected from the defunct Hillsborough County sales tax for transportation.

Circuit Judge John C. Cooper dismissed the case from Robert Emerson of Apollo Beach after a hearing Wednesday, according to Hillsborough County Attorney Christine Beck. An online copy of Cooper’s order was not available Wednesday at the website for the Leon County Clerk of the Circuit Court and Comptroller.

In an email to Hillsborough commissioners, Beck wrote “the court appeared convinced that because the Legislature has intervened to specify the manner in which the proceeds were to be spent that the court no longer has jurisdiction to authorize a class action to proceed.”

That had been the legal position of the defendants in the case — Hillsborough County and Clerk of the Circuit Court and Comptroller Cindy Stuart. They argued Emerson’s claim was moot and cited the July 2022 final order from Hillsborough Circuit Court Judge Rex Barbas in an earlier suit from then-Commissioner Stacy White.

Barbas said the state Legislature was the proper authority to decide disbursement of the proceeds from the 1% sales tax collected from Jan. 1, 2019, until the Florida Supreme Court voided it in February 2021. White successfully challenged the legality of the tax, saying the authority to allocate the transportation money to specific projects should rest with elected commissioners. Instead, the allocations were part of the November 2018 ballot referendum that voters approved by a 57% to 43% margin.

The Florida Supreme Court, however, did not comment on what to do with the money already collected, which led to Barbas’ ruling after he rejected the county’s pitch for a refund plan overseen by a three-judge panel.

According to court documents, the tax produced $569.7 million, including $490 million collected by Hillsborough businesses, $71.7 million collected by out-of-county dealers and $8 million in interest. Following Barbas’ ruling, Stuart’s office turned the money over to the state Department of Revenue.

Less than three weeks after the state Supreme Court invalidated the tax, Emerson filed the class-action suit in Tallahassee.

“Now that the surtax has been ruled unconstitutional, defendants must stop collecting the tax and refund any tax proceeds to the taxpayers. To hold otherwise would sanction an unlawful confiscation,” Emerson’s suit contended.

Others, however, considered it nothing more than a money-grab. Former Commissioner Kimberly Overman, for instance, had publicly expressed concerns that a class-action suit would enrich the law firms administering the refunds, leaving less for members of the public who paid the sales tax.

The escrowed money, Commissioner Pat Kemp said Wednesday, “is desperately needed for transportation in Hillsborough County. It’s the taxpayers here who paid it. I hope we can finally move on and have this resolved.”

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State lawmakers are expected to decide the fate of the money in the legislative session that begins in March. White and his successor, Commissioner Michael Owen, have both advocated for widening Lithia Pinecrest Road.

Cooper’s ruling dismissed the case without prejudice, which means it can be refiled. Emerson can file an appeal within 30 days. Emerson declined to comment.

Separately, Hillsborough voters rejected a new transportation sales tax referendum in November by a 51.25% to 48.75% margin.