Did a radio broadcaster's tower-space lease qualify for Florida's real-property rental exemption based on the documents first submitted?

Plain-English summary

Florida initially denied a sales-tax exemption for a radio broadcaster's lease of tower space and fixtures because the submitted record did not show that the tower itself stood on a public or private street or right-of-way.

The broadcaster used the tower for communications, but the surveys showed private roads encircling the site and guy-wire easements crossing roads. The Department concluded that the leased tower area was separate from the roads and railroad right-of-way. Access to the site was not enough.

This was not the Department's final view of the same lease. TAA 21A-001 later incorporated the July 10 response, considered additional facts showing that the tower was constructed on a privately owned dirt access road, treated that road as a private street, and allowed the exemption.

What this means for you

Radio broadcasters and tower tenants

The tower's precise physical location matters. A right to travel over a road or an easement near the tower does not by itself establish that the tower is located on the exempt property.

Property and tax teams

Provide parcel records, surveys, permit history, and evidence of actual road use. Additional site evidence changed the result in the later advisement.

Common questions

Was the exemption granted in this ruling? No.

Why not? The original documents placed the tower inside roads and easements, not on a qualifying street or right-of-way.

Did Florida later change the result? Yes. TAA 21A-001 allowed the exemption after additional facts established a private street beneath the tower.

Citations and references

• Fla. Stat. Sec. 212.031(1)(a)5.
• Fla. Stat. Sec. 212.031(1)(b)
• Fla. Stat. Sec. 177.031(16)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 20A-013

Original ruling text

TAX: Sales and Use Tax
TAA NUMBER: 20A-013
SUBJECT: Lease of Space on a Communications Tower
STATUTE CITE(S): Sections 177.031, 212.031, 403.503, and 610.103, Florida Statutes
RULE CITE: Rule 12A-1.070, Florida Administrative Code
QUESTION:
Whether Taxpayer’s lease of tower space and fixtures for the transmission of radio signal
qualifies for the sales tax exemption provided in section 212.031(1)(a)5., F.S.

ANSWER:
Taxpayer’s lease of tower space and fixtures for the transmission of radio signal does not
meet the qualification requirements for the sales tax exemption provided in section
212.031(1)(a)5., F.S.

July 10, 2020
XXX
XXX
XXX
RE:

Technical Assistance Advisement No. – 20A-013
Sales and Use Tax – Lease of Communication Tower Space
XXX (“Taxpayer”)
FEI No. XXX
Sections 177.031, 212.031, 403.503, and 610.103, Florida Statutes (F.S.);
Rule 12A-1.070, Florida Administrative Code (F.A.C.)
XXX (“Tower Licensor”)
XXX (“Prior Broadcast Company”)
XXX (“Ground Lessee”)
XXX (“Tower Site”)
XXX (“Landowner”)

Dear XXX:
This letter is a response to your petition on behalf of XXX (“Taxpayer”), dated March 11, 2020
(received March 16, 2020), for the Florida Department of Revenue’s (the “Department’s”)

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July 10, 2020
Florida Department of Revenue
Page 2
issuance of a Technical Assistance Advisement ("TAA") with regards to the sales tax
implications on the lease of space on a communications tower. Your petition has been
carefully examined and the Department finds it to be in compliance with the requisite criteria
set forth in Chapter 12-11, Florida Administrative Code. This response to your request
constitutes a TAA and is issued to you under the authority of s. 213.22, F.S.
Requested Advisement
Whether Taxpayer’s lease of tower space and fixtures for the transmission of radio signal
qualifies for the sales tax exemption provided in section 212.031(1)(a)5., F.S.
Brief Answer
Taxpayer’s lease of tower space and fixtures for the transmission of radio signal does not
meet the qualification requirements for the sales tax exemption provided in section
212.031(1)(a)5., F.S.
Facts
Taxpayer, a radio broadcaster, has use rights to a tower provided by Tower Lessor for the
purpose of radio transmission. Taxpayer acquired use rights of Tower Site from Prior
Broadcast Company. Tower Site is built on a portion of property subject to ground lease from
Landowner to Ground Lessee. Ground Lessee assigned a portion of the land to Tower Licensor
who provided Tower Site use rights to Prior Broadcast Company pursuant to the Site License
Agreement. Taxpayer obtained its use rights pursuant to an Asset Purchase Agreement with
Prior Broadcast Company.
Taxpayer provided copies of the Asset Purchase Agreement, the Site License Agreement, the
Consent to Assignment from Ground Lessor, copies of the original Memorandum of Lease
between Landowner and Ground Lessee, and the Assignment and Assumption of Ground
Lease between Prior Broadcast Company and Ground Lessee.
The parcel involving the ground lease is 18.4 acres, and the Site License Agreement is for 2056
square feet. In addition to the Tower Site rental location, there are other tenants located on
the parcel. Taxpayer provided the parcel description as “Exhibit A.” It provides that the parcel
that the Tower Site is located as follows:
The Land is described and depicted as follows:
PARCEL 1:
XXX

XXX
July 10, 2020
Florida Department of Revenue
Page 3

XXX
XXX
XXX
PARCEL 2:
XXX
XXX
XXX
XXX
XXX
The request provides that the Site License Agreement provides for the tower and fixtures.
Taxpayer provided two Site License Agreements, both of which provide, in pertinent part, the
following description of the leased property:

1. Premises. Licensor currently leases, licenses or owns a parcel of land
   (“Land”) and owns and operates a telecommunications tower (“Tower”)
   located thereon commonly known as [Tower Site] (the Tower and Land are,
   collectively, the “Site”). The Land is more particularly described in Exhibit A
   attached hereto and incorporated herein. Licensor hereby licenses to
   Licensee and Licensee licenses from Licensor, (a) the portion of the Land on
   which is currently located an equipment shelter that is owned by Licensee and
   used in connection with its radio operations (the “Equipment Shelter”) and (b)
   space on the Tower at the _-foot level (antennas mounted on the
   tower with a center of radiation at approximately _____ feet above grade)
   (collectively, the “Premises”) and grants Licensee the right to install utility
   cables, conduits and pipes from the existing utility termination point on the
   Premises; said premises and right-of-way for access being substantially
   described in Exhibit B2 annexed hereto. Notwithstanding the foregoing,
   Licensor grants Licensee the non-exclusive right to use the Land to access the
   Premises and to install, maintain and repair utilities serving the Premises and
   improvements thereon.
   The property appraiser website does not provide for a right-of-way for the parcel, except for
   the railroad right-of-way, which is on the Landowner’s parcel, but not on the Tower Site.

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July 10, 2020
Florida Department of Revenue
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Taxpayer provided surveys and photographs of the parcel that Tower Site is located. The
surveys provide for three 20-foot guy-wire easements extending from Tower Site. One of the
easements extend over the access road that the Site License Agreement allows Taxpayer to
use to access the Tower Site. The railroad right-of-way on the parcel is not on the Tower Site
portion of the parcel. Based on the survey, it is unclear to what extent that the utility
easement is located on Tower Site. The survey map reflects that the access roads encircle
Tower Site.
Taxpayer’s Argument
It is Taxpayer’s position that its lease of tower space and fixtures for the transmission of radio
signal meets the qualification requirements for the sales tax exemption provided in section
212.031(1)(a)5., F.S. Taxpayer argues that: (i) the tower is located on a private right-of-way
where poles, conduits, fixtures, and similar improvements are located; (ii) that the property
is occupied by a utility or provider of communications; and (iii) the property is used for utility
or communications purposes.
Taxpayer maintains that the documents, including the survey, and the legal descriptions
provide for a 20' wide easement/right-of-way on which the tower site is located.
As provided in Paragraph 1 of the Site License Agreements, Taxpayer leased the portion of
the ground lease on which the tower and fixtures for Taxpayer’s equipment are located.
Taxpayer was also granted the right to install utility cables, conduits, etc. on the leased
premises and right-of-way on which it is located, as well as access to the leased premises on
the same right-of-way. In May 2019, Ground Lessee surveyed the Tower Site. The surveys
and photographs of the Tower Site clearly reflect that Tower Site is located not only on the
right-of-way, but also a private road that encircles the tower site. Other easements depicted
in the surveys are “guy wire” easements for the tower, not access easements.
Although not relevant in determining applicability of the sales tax exemption, Tower Site is
enclosed by fencing as required for all tower sites by the Federal Communications
Commission and other applicable laws and regulations. The presence of legally required
fencing does not alter the facts that the tower site is located on a right-of-way and a private
road. To view otherwise would disqualify all cellular and communications tower sites from
the exemption, violating the legislative intent of section 212.031, F.S.
Applicable Law and Discussion
Section 212.031(1)(a)5, F.S., provides:
(1)(a) It is declared to be the legislative intent that every person is exercising
a taxable privilege who engages in the business of renting, leasing, letting, or

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July 10, 2020
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granting a license for the use of any real property unless such property is:

5. A public or private street or right-of-way and poles, conduits, fixtures, and
   similar improvements located on such streets or rights-of-way, occupied or
   used by a utility or provider of communications services, as defined by s.
   202.11, for utility or communications or television purposes. For purposes of
   this subparagraph, the term “utility” means any person providing utility
   services as defined in s. 203.012. This exception also applies to property,
   wherever located, on which the following are placed: towers, antennas,
   cables, accessory structures, or equipment, not including switching
   equipment, used in the provision of mobile communications services as
   defined in s. 202.11. For purposes of this chapter, towers used in the provision
   of mobile communications services, as defined in s. 202.11, are considered to
   be fixtures.
   Two separate exemptions from taxation on the rental, lease, or license to use real property
   are contained within s. 212.031(1)(a)5, F.S. One exemption applies to property that
   constitutes a public or private street or right-of-way, on which certain improvements or
   fixtures are located, while the other applies to property used for mobile communication
   services. Since Taxpayer is not a mobile communication provider, it is only pertinent to
   discuss the exemption given to property located on a right-of-way.
   To qualify for the exemption for the property that constitutes a public or private street or
   right-of-way, on which certain improvements or fixtures are located, the following elements1
   must be satisfied:
   1) The property is a public or private street or right-of-way;
   2) Poles, conduits, fixtures, and similar improvements are located on such street or
   right-of-way;
   3) The property is occupied or used by a utility or provider of communications services
   as defined by s. 202.11; and
   4) The property is used for utility, communications, or television purposes.
   Taxpayer asserts that it leases tower space and fixtures on a communications tower located
   on a private “right-of-way”. The legislature did not define the term "right-of-way" for
   purposes of the exemption contained in section 212.031(1)(a)5., F.S., however, the term has
   been defined in Florida Statutes, in other contexts. For example, s. 177.031(16), F.S., defines
   the term, for purposes of land boundaries, to mean "land dedicated, deeded, used, or to be
   used for a street, alley, walkway, boulevard, drainage facility, access for ingress and egress,
   or other purpose by the public, certain designated individuals, or governing bodies." Section
   403.503(27), F.S, defines the term, for purposes of environmental control relating to the
   1

See Cox Radio, Inc., Case Number DOR-07-2-DS.

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Florida Electrical Power Plant Siting Act, to mean "land necessary for the construction and
maintenance of a connected associated linear facility, such as a railroad line, pipeline, or
transmission line."
Although a right-of-way typically refers to a roadway it can mean other things as well. While
the words “road” and “way” are frequently used interchangeably, the word “way” is more
generic, including many things besides roads. A road is more properly any piece of land used
or appropriated for travel, whereas private ways may include any one of innumerable other
variety of ways. 20 Fla. Jur. 2d, Easements ss. 1, p. 340. Moreover, the statute uses the
phrase “street or right-of-way” indicating that the term right-of-way means something other
than a road or street. Accordingly, s. 610.103(10), F.S., establishes that the term “public rightof-way” includes the use of areas on or above, or below, a public roadway, highway, street,
sidewalk, alley, etc., for use by cable and video services providers.
Where the Legislature uses exact words or phrases, though in different statutory provisions,
it may be assumed that they were intended to mean the same thing. Fla. Jur. 2d Statutes s.

133. The term "right-of-way" used in s. 212.031(1)(a)5., F.S., with no distinguishing gloss or
     definition, must be used in the common sense meaning. Pederson v. Green, 105 So.2d 1 (Fla.
     1958). Adherence to that principle is required because the legislature is presumed to know
     the plain and ordinary meaning of the terms it uses and if other than the plain meaning is
     intended, the legislature has the power to define the term used. Brooks v. Anastasia
     Mosquito Control District, 148 So.2d 1239, 1242 (Fla. 4th DCA 1976).
     Although, the courts have determined that the term "right-of-way" does not necessarily mean
     a legal and enforceable incorporeal right such as an easement. The term has been construed
     to mean not only a right of passage over the land of another, but it is also used to describe
     the strip of land on which an existing road is located. Lovey v. Escambia County, 141 So.2d
     761 (Fla. DCA 1962). However, to expand the definition of "right-of-way" beyond a
     passageway to include fixed locations not involving a utility, or an area providing access, is
     contrary to the plain meaning of the use of the term “right-of-way.”
     The survey maps provided by Taxpayer demonstrate that the leased premises have at least
     two roads, and three preexisting guywire easements that extend from the tower over two
     roads that encircle the land where the tower and improvements were constructed on. The
     photographs identify walkways and areas in which vehicular traffic is possible. The
     documents provide for a railroad right-of-way. Based on the documentation provided, the
     leased premises (0.0472 acres) only include a portion of the 18.4 acres of land owned by the
     initial landlord. Based on the maps, the railroad right-of-way is not part of the leased
     premises. Most of the road is not part of the leased premises. Even though Taxpayer may
     use the existing private roads to access the tower site, the tower site is not part of such roads,
     or private right-of-way, but just encircled by them.

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July 10, 2020
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Based on the information provided, only the sidewalk areas and the encircling private roads
constitute a right-of-way. These sidewalks and encircling roads are not used for
communications purposes. Furthermore, an easement is not considered a right-ofway. While an easement constitutes a property interest, a right-of-way does not create a
property interest and may be extinguished.
The tower in question is not constructed on a private right-of-way. However, s. 212.031(1)(b),
F.S., indicates in pertinent part that “[w]hen a lease involves multiple use of real property
wherein a part of the real property is subject to the tax herein, and a part of the property
would be excluded from the tax under subparagraph (a)1. [ . . . ] the department shall
determine, from the lease or license and such other information as may be available, that
portion of the total rental charge which is exempt from the tax imposed by this section. [ . . .
].” Therefore, even if the leased premises contain a private right-of-way, the portion of the
lease regarding the encircled are where the Tower is erected, is subject to the tax.
To qualify for the tax exemption provided in s. 212.031(1)(a)5., F.S., Taxpayer must satisfy all
the requirements. The courts have determined that exemptions from, or exceptions to,
taxing statutes are strictly construed against granting the exemption or exception. United
States Gypsum Company v. Green, 110 So.2d 409 (Fla. 1959), and State ex rel. Szabo Food
Services, Inc. v. Dickinson, 286 So.2d 529 (Fla. 1973). Although Taxpayer is a communications
provider, using the Tower Site premises for communications purposes, the Tower is not
erected on a public or private right-of-way. Also, the guy wire easements are not on the
road, but over the road. In regard to Taxpayer’s argument that all cellular and communication
towers would be subject to tax based on the Department’s position fails to consider the
second sentence in s. 212.031(1)(a)5., F.S., which does not require to be located on a street
or right-of-way when used for mobile communication services. That exclusion allows for the
tower to be located anywhere.
Concluding Statement
Based on the information and documentation provided, Taxpayer’s lease of space on the
Tower Site does not satisfy the qualification requirements for the sales tax exemption
provided in s. 212.031(1)(a)5., F.S.
This response constitutes a Technical Assistance Advisement under section 213.22, F.S.,
which is binding on the Department only under the facts and circumstances described in the
request for this advice as specified in section 213.22, F.S. Our response is predicated on those
facts and the specific situation summarized above. You are advised that subsequent
statutory or administrative rule changes, or judicial interpretations of the statutes or rules,
upon which this advice is based, may subject similar future transactions to a different
treatment than that expressed in this response. You are further advised that this response,
your request and related backup documents are public records under Chapter 119, F.S., and

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July 10, 2020
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are subject to disclosure to the public under the conditions of section 213.22, F.S.
Confidential information must be deleted before public disclosure. In an effort to protect
confidentiality, we request you provide the undersigned with an edited copy of your request
for Technical Assistance Advisement, the backup material, and this response, deleting
names, addresses, and any other details which might lead to identification of the taxpayer.
Your response should be received by the Department within 15 days of the date of this letter.
Sincerely,

Ivonne De Feria-Molini
Ivonne De Feria-Molini
Tax Law Specialist
Technical Assistance & Dispute Resolution
Record ID: