New Florida Bill Could Set Up Legal Fights Between Businesses, Ordinances

A bill approved by the Florida House and sent to Governor Ron DeSantis Wednesday could allow some businesses to sue local governments if they believe a city ordinance caused them to lose at least 15 percent of their profits.

Senate Bill 620, called the Local Business Protection Act, would let businesses that have been established for at least three years challenge local ordinances, which critics have said could allow businesses that actually harm their community to challenge an ordinance that is meant to stop their behavior,the Tampa Bay Times reported.

Legal action could not be brought against cities over ordinances that require businesses to follow state and federal laws like fire codes and other safety measures.

Once a legal challenge is brought, the ordinance would be suspended until the lawsuit is concluded and a judge determines whether an ordinance is harmful to a business's profits and whether a city should be required to pay the legal fees of the business.

Florida House Businesses Lawsuits Bill
Florida's House passed a bill Wednesday that could allow local businesses to sue city governments over ordinances they believe harm their profits. Above, a view of the Florida State Capitol building on November 10, 2018, in Tallahassee, Florida. Mark Wallheiser/Getty Images

One example raised by House Democrats that could cause an issue is noise ordinances that impact bars and restaurants that are open late at night, but House Republicans said it would be unlikely that profits lost because of such ordinances would rise to the necessary 15 percent.

Bill sponsor Representative Lawrence McClure also said the bill has an "opportunity to cure" period that would allow cities to amend or repeal ordinances that could be a liability.

Another bill currently being considered by the legislature, SB 280, would require cities to produce a "business impact estimate" to determine what economic impact an ordinance would have on local businesses before it can be put into place.

Supporters of the bills, including the Florida Chamber of Commerce and several business organizations, said it would eliminate the need for the state legislature to get involved in disputes between businesses and local governments to determine whether an ordinance should stay in place or if it should be overruled by state law, according to the Florida Political Review.

Opponents, including the Florida League of Cities, said it would allow businesses to have a significant influence on local policy decisions and lead to lawsuits that are paid for by taxpayers.

A University of Florida business law professor, Robert W. Emerson, told the Florida Political Review that while it's easy for a business to claim an ordinance is to blame for their profit losses, it could be difficult to prove that the local government is at fault and the cause of the lost profits wasn't simply market competition or other forces.

Update 03/09/22, 3:05 p.m. ET: This story has been updated with additional information.