Business impact estimate in advance of new local ordinances; process to
seek damages when businesses suffer losses caused by new regulations
The Florida Senate today passed Senate Bill 620, Local Business Protection Act, and Senate Bill 280, Local Ordinances, both by Senator Travis Hutson (R-St. Augustine). The Local Business Protection Act creates a process by which an established business can recover losses caused by new ordinances imposed by local governments. SB 280 improves transparency by requiring local governments to provide an estimate of how a new regulation would impact local businesses.
“The bills we passed today work together to address the challenges existing businesses face when local governments impose new regulations, striking the right balance between respecting the role of local government and protecting local businesses,” said Senator Hutson.
“Private sector businesses, not the government, create the jobs and provide the goods and services our communities need to thrive,” said Florida Senate President Wilton Simpson (R-Trilby). “We want to make sure our communities, and in particular our business owners, have the chance to understand the impact of local ordinances before new regulations are put in place. In the event a local ordinance causes an existing business owner to lose profits, it is important that we have a fair process for that business owner to recover damages.”
SB 280, Local Ordinances, requires counties and cities to produce a “business impact estimate” prior to passing an ordinance. The estimate must be published on the local government’s website and include certain information, such as the proposed ordinance’s purpose, estimated economic impact on businesses, and compliance costs.
“SB 280 improves transparency on the front end by requiring a business impact statement before an ordinance is passed, so local communities and business owners understand what is at stake, and can hopefully address any problems before the ordinance is passed in the first place,” continued Senator Hutson. “When an ordinance is arbitrary or unreasonable, we don’t want to see Floridians lose their rights and small business owners lose their livelihood as these cases languish in the court system. The bill gives priority to these cases, so they can be resolved as quickly as possible.”
SB 620, Local Business Protection Act, creates a cause of action for an established business to recover loss of business damages from a county or municipality whose regulatory action has caused a significant impact on the business.
“Consistency is critical for business owners who are making decisions about hiring, capital investment, etc. There are huge consequences for businesses when local government changes the rules in the middle of the game, and this bill creates a fair process by which a long-standing business owner whose business has been drastically impacted by a local ordinance can seek an appropriate remedy,” said Senator Hutson.
Landowners currently have a cause of action under the Bert J. Harris Act to compensate them for the lost value of their land caused by certain local government actions. Landowners also have a cause of action for onerous local regulation in the form of exactions, and business landowners have a cause of action under eminent domain law for business damages related to a taking of real property. Similarly, this bill creates a cause of action for a business to sue a local government when an ordinance or charter provision causes a significant loss of profits to the business. The business must be operating legally and have been in operation for at least three years to qualify. The bill applies prospectively to ordinances implemented after the effective date of the bill.
