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The Florida General Refunding Act of 1931 (Act) gives broad and full authority for the issuance of refunding bonds and the Supreme Court of Florida has in several cases held that such refunding bonds can be issued and sold, under the terms of said Act, without submitting the matter to a vote of the people, by virtue of the Act itself and the concluding clause of Fla. Const. art. IX, § 6, adopted in 1931, which reads: but the provisions of this law shall not apply to the refunding of bonds issued exclusively for the purpose of refunding of the bonds or the interest thereon of such counties, districts or municipalities. The first clause of said amendment prohibits the issue of bonds unless the same shall have been approved by a majority of the votes cast in an election in which a majority of the freeholders who are qualified electors residing in such counties, districts, or municipalities shall participate, to be held in the manner to be prescribed by law.
The county adopted a resolution authorizing the issuance of refunding bonds to refund 50 percent of bonds issued 15 years earlier that were shortly to fall due. The resolution stated that the county would not have on hand when the old bonds matured sufficient funds to pay more than one-half the amount then falling due; hence the necessity for issuing the refunding bonds under authority of the Act to take care of the other half. The county filed a petition for validation of the refunding bonds and the trial court entered a decree of validation. On appeal, the state and the taxpayer argued that the resolution violated the homestead exemption amendment in Fla. Const. art. X, § 7, which was enacted during the 15-year interval.
Was the refunding resolution, notwithstanding the intervening constitutional amendment exempting homesteads from taxation, valid?
The court affirmed the decree. The court held that the refunding resolution, insofar as it pertained to an exchange of the refunding bonds for a like amount of the old bonds, and insofar as it stipulated that as to the refunding bonds thus exchanged the same taxing power which protected the old bonds would continue in full force and effect, was valid notwithstanding the intervening constitutional amendment exempting homesteads from taxation.