On July 7, 2023, the Florida Court of Appeal handed down a significant ruling in favor of Fixed Base Operators (FBOs) providing aviation support services at municipal airports in Hillsborough County, Florida. The Court struck down a lower court ruling that subjected FBOs to ad valorem property taxes on leasehold interests at regional airports in the county. The National Air Transportation Association (NATA) filed an amicus (‘friend of the court”) brief arguing that the imposition of ad valorem taxes on FBOs was contrary to Florida law and harmful to the general aviation economy.
The Court of Appeal’s July 7 ruling correctly determined that FBOs are exempt from property tax under Florida law thereby ensuring continued vitality and efficiency in the local general aviation space. The Court wrote “[t]he lessees’ uses of the property are unique in that they must occur at the airport, and their uses are essential to airport operations.”
NATA President and CEO Curt Castagna stated, “The Court’s ruling removes a significant burden to general aviation operations in Florida and represents a resounding victory for economic efficiency and growth in our industry. Our members around the country should be reassured that the legislature and court system in Florida recognize the vital role that FBOs play in facilitating general aviation operations which contribute mightily to our economy.”
Privately owned and operated FBOs provide aviation support services such as tie-down and hangar service, refueling, ramp service, maintenance, and flight training at thousands of general aviation airports around the country. These services are integral to the efficient operation of the aviation ecosystem. While airport sponsors (e.g., municipal governments, states, etc.) provide FBO services at many airports, approximately 55% of U.S. airports lease facilities to privately operated FBOs to provide aviation services, products, and facilities. In these instances, privately operated FBOs perform functions that are “governmental” in nature and under Florida law are exempt from property taxes on their leasehold interests.
In 2019 the Hillsborough County assessor attempted to impose property taxes on FBOs operating under municipal leases at three general aviation airports and Tampa International Airport. The imposition of these taxes would have burdened the general aviation community and subjected airport users to higher costs in comparison to surrounding areas.
