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House Bill 0809

Florida House of Representatives - 1997 HB 809 By Representative Eggelletion 1 A bill to be entitled 2 An act relating to tax credits for charitable 3 contributions to state contract providers; 4 amending s. 199.023, F.S.; defining the term 5 "state contract provider contribution"; 6 creating s. 199.105, F.S.; providing a credit 7 against the intangibles tax for charitable 8 contributions to not-for-profit state contract 9 provider organizations; providing for a 10 reduction in state funding of recipient 11 organizations; creating s. 220.185, F.S.; 12 providing legislative policy and purpose; 13 providing a credit against the corporate income 14 tax for charitable contributions to 15 not-for-profit state contract provider 16 organizations; providing for a reduction in 17 state funding of recipient organizations; 18 amending s. 220.02, F.S.; providing for the 19 order in which credits against the corporate 20 income tax are to be taken; creating s. 21 624.5104, F.S.; providing a credit against the 22 insurance premium tax for charitable 23 contributions to not-for-profit state contract 24 provider organizations; providing for a 25 reduction in state funding of recipient 26 organizations; providing an effective date. 27 28 Be It Enacted by the Legislature of the State of Florida: 29 30 Section 1. Subsection (13) is added to section 31 199.023, Florida Statutes, to read: 1 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 199.023 Definitions.--As used in this chapter: 2 (13) "State contract provider contribution" means a 3 contribution of cash or liquid assets to a corporation that 4 qualifies for tax exempt status under s. 501(c)(3) of the 5 Internal Revenue Code of 1986 as amended and that provides 6 services to the residents of this state under contract to a 7 state agency. 8 Section 2. Section 199.105, Florida Statutes, is 9 created to read: 10 199.105 Contract service provider contribution 11 credit.-- 12 (1) AUTHORIZATION TO GRANT STATE CONTRACT PROVIDER 13 CONTRIBUTION TAX CREDITS.-- 14 (a) For each taxable year that begins on or after July 15 1, 1997, there is allowed a credit against any tax due under 16 this chapter for the taxable year in the amount of 25 percent 17 of the difference between the taxpayer's state contract 18 provider contributions for the current tax year and the 19 taxpayer's state contract provider contributions for the 20 previous tax year. 21 (b) Tax credits must be approved in advance by the 22 Executive Director of the Department of Revenue and by the 23 head of the agency that directly supervises the state-funded 24 activities of the recipient not-for-profit organization. 25 (c) A taxpayer who is eligible to receive the credit 26 provided for in s. 220.185 or in s. 624.5104 is ineligible to 27 receive the credit provided for in this section. 28 (2) ELIGIBILITY REQUIREMENTS.-- 29 (a) Each state contract provider contribution must be 30 in the form of cash or liquid assets. 31 2 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 (b) All state contract provider contributions must be 2 used by the recipient organization exclusively for providing 3 those types of services which are funded in the General 4 Appropriations Act for the current year. 5 (c) All state contract provider contributions must be 6 made to qualifying recipient organizations. As used in this 7 section, the term "qualifying recipient organization" means an 8 organization that: 9 1. Is a not-for-profit corporation that is exempt from 10 taxation under s. 501(c)(3) of the Internal Revenue Code of 11 1986 as amended and that is under contract to a state agency 12 and receives funding through the General Appropriations Act in 13 the current fiscal year; 14 2. Is fulfilling its state contract satisfactorily, as 15 certified by the head of the agency that directly supervises 16 its state-funded activities; 17 3. Has sufficient unspent appropriated funds in its 18 contract to allow the state to withhold funds in an amount 19 equal to 25 percent of the creditable contribution; and 20 4. Has demonstrated to the head of the supervising 21 agency a need for funds in an amount greater than that 22 appropriated by the state. 23 (3) APPLICATION REQUIREMENTS.-- 24 (a) A taxpayer that wishes to participate in this 25 program must submit to the Department of Revenue an 26 application for tax credit which sets forth the name of the 27 qualifying recipient organization, the amount of the proposed 28 contribution and the amount of the contribution the taxpayer 29 made to the organization in the previous tax year. 30 (b) The taxpayer must submit a separate application 31 for tax credit for each individual contribution that the 3 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 taxpayer proposes to contribute to each qualifying recipient 2 organization. 3 (4) ADMINISTRATION.-- 4 (a) The Department of Revenue may adopt all rules 5 necessary for the administration of this section, including 6 rules for approving or disapproving proposals that are 7 submitted by taxpayers. 8 (b) Each state agency that supervises one or more 9 not-for-profit state contract provider organizations that meet 10 the criteria for qualifying to be recipient organizations must 11 provide to the department a list of all such organizations 12 supervised by the agency. 13 (c) The department shall maintain a list of eligible 14 recipients, shall mail copies of the list to all recipients of 15 the tax form, and shall also post the list on the Internet. 16 (d) The department may approve a state contract 17 provider contribution only if there are sufficient unspent 18 appropriations in the recipient's state contract to allow the 19 state to withhold funds in an amount equal to 25 percent of 20 the creditable contribution. As used in this subsection, the 21 term "creditable contribution" means the difference between 22 the amounts that the recipient received from a taxpayer in the 23 current taxable year and in the previous taxable year, 24 respectively. 25 (e) Upon approval of a state contract provider 26 contribution, the department shall direct the agency directly 27 supervising the recipient organization to prepare a budget 28 amendment that reduces the amount of the appropriation that 29 the recipient organization is to receive by 25 percent of the 30 amount of the creditable contribution. In addition, the agency 31 shall prepare a budget amendment that transfers to the General 4 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 Revenue Fund unspent funds in an amount that offsets the cost 2 of the state contract provider contribution tax credit. 3 Section 3. Section 220.185, Florida Statutes, is 4 created to read: 5 220.185 Contract service provider contribution 6 credit.-- 7 (1) POLICY AND PURPOSE.--It is the policy of this 8 state to encourage the participation of private corporations 9 in supporting not-for-profit organizations that provide, under 10 contract to various state agencies, services to residents of 11 this state. The purpose of this section is to provide an 12 incentive for such participation by granting partial state 13 income tax credits to corporations that contribute to 14 not-for-profit organizations that provide services to 15 residents of this state and are funded through appropriations 16 of state moneys. As these contributions increase the funds 17 available to these not-for-profit organizations, state funding 18 to these organizations will be reduced, offsetting any loss in 19 state revenue which results from the income tax credit. 20 (2) AUTHORIZATION TO GRANT STATE CONTRACT PROVIDER 21 CONTRIBUTION TAX CREDITS.-- 22 (a) For each taxable year that begins on or after July 23 1, 1997, there is allowed a credit against any tax due under 24 this chapter for the taxable year in the amount of 25 percent 25 of the difference between the taxpayer's state contract 26 provider contributions for the current tax year and the 27 taxpayer's state contract provider contributions for the 28 pervious tax year. 29 (b) Tax credits must be approved in advance by the 30 Executive Director of the Department of Revenue and by the 31 5 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 head of the agency that directly supervises the state-funded 2 activities of the recipient not-for-profit organization. 3 (c) If a credit that is granted under this section is 4 not fully used in any one year because a taxpayer owes an 5 insufficient amount of tax under this chapter, the unused 6 portion of the credit may be carried forward for a period not 7 to exceed 5 years. The carryover credit may be used in a 8 subsequent year in which the tax imposed under this chapter 9 exceeds the amount of the tax credit that is allowed under 10 this section for that year after any other credits and unused 11 credit carryovers have been applied in the order provided in 12 s. 220.02(10). 13 (d) A taxpayer who files a Florida consolidated return 14 as a member of an affiliated group pursuant to s. 220.13(1) 15 may be allowed the credit on a consolidated return basis. 16 (e) A taxpayer who is eligible to receive the credit 17 provided for in s. 624.5104 is ineligible to receive the 18 credit provided for in this section. 19 (3) ELIGIBILITY REQUIREMENTS.-- 20 (a) Each state contract provider contribution made by 21 a business firm must be in the form of cash or liquid assets. 22 (b) All state contract provider contributions must be 23 used by the recipient organization exclusively for providing 24 those types of services which are funded in the General 25 Appropriations Act for the current year. 26 (c) All state provider contributions must be made to 27 qualifying recipient organizations. As used in this section, 28 the term "qualifying recipient organization" means an 29 organization that: 30 1. Is a not-for-profit corporation that is exempt from 31 taxation under s. 501(c)(3) of the Internal Revenue Code of 6 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 1986 as amended and that is under contract to a state agency 2 and receives funding through the General Appropriations Act in 3 the current fiscal year; 4 2. Is fulfilling its state contract satisfactorily, as 5 certified by the head of the agency that directly supervises 6 its state-funded activities; 7 3. Has sufficient unspent appropriated funds in its 8 contract to allow the state to withhold funds in an amount 9 equal to 25 percent of the creditable contribution; and 10 4. Has demonstrated to the head of the supervising 11 agency a need for funds in an amount greater than that 12 appropriated by the state. 13 (4) APPLICATION REQUIREMENTS.-- 14 (a) A business that wishes to participate in this 15 program must submit to the Department of Revenue an 16 application for tax credit which sets forth the name of the 17 qualifying recipient organization, the amount of the proposed 18 contribution, and the amount of the contribution the taxpayer 19 made to the organization in the previous tax year. 20 (b) The business firm must submit a separate 21 application for tax credit for each individual contribution 22 that it proposes to contribute to each qualifying recipient 23 organization. 24 (5) ADMINISTRATION.-- 25 (a) The Department of Revenue may adopt all rules 26 necessary for the administration of this section, including 27 rules for approving or disapproving proposals that are 28 submitted by business firms. 29 (b) Each state agency that supervises one or more 30 not-for-profit state contract provider organizations that meet 31 the criteria for qualifying to be recipient organizations must 7 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 provide to the department a list of all such organizations 2 supervised by the agency. 3 (c) The department shall maintain a list of eligible 4 recipients, shall mail copies of the list to all corporations 5 that are subject to tax under this code, and shall also post 6 the list on the Internet. 7 (d) The department may approve a state contract 8 provider contribution only if there are sufficient unspent 9 appropriations in the recipient's state contract to allow the 10 state to withhold funds in an amount equal to 25 percent of 11 the creditable contribution. As used in this subsection, the 12 term "creditable contribution" means the difference between 13 the amounts that the recipient received from a taxpayer in the 14 current taxable year and in the previous taxable year, 15 respectively. 16 (e) Upon approval of a state contract provider 17 contribution, the department shall direct the agency directly 18 supervising the recipient organization to prepare a budget 19 amendment that reduces the amount of the appropriation that 20 the recipient organization is to receive by 25 percent of the 21 amount of the creditable contribution. In addition, the agency 22 shall prepare a budget amendment that transfers to the General 23 Revenue Fund unspent funds in an amount that offsets the cost 24 of the state contract provider contribution tax credit. 25 Section 4. Subsection (10) of section 220.02, Florida 26 Statutes, is amended to read: 27 220.02 Legislative intent.-- 28 (10) It is the intent of the Legislature that credits 29 against either the corporate income tax or the franchise tax 30 be applied in the following order: those enumerated in s. 31 220.68, those enumerated in s. 631.719(1), those enumerated in 8 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 s. 631.705, those enumerated in s. 220.18, those enumerated in 2 s. 631.828, those enumerated in s. 220.181, those enumerated 3 in s. 220.183, those enumerated in s. 220.185, those 4 enumerated in s. 220.182, those enumerated in s. 221.02, those 5 enumerated in s. 220.184, those enumerated in s. 220.186, and 6 those enumerated in s. 220.188. 7 Section 5. Section 624.5104, Florida Statutes, is 8 created to read: 9 624.5104 Contract service provider contribution tax 10 credit.-- 11 (1) POLICY AND PURPOSE.--It is the policy of this 12 state to encourage the participation of insurers in supporting 13 not-for-profit organizations that provide, under contract to 14 various state agencies, services to residents of this state. 15 The purpose of this section is to provide an incentive for 16 such participation by granting partial state insurance premium 17 tax credits to insurers that contribute to not-for-profit 18 organizations that provide services to residents of this state 19 and are funded through appropriations of state moneys. As 20 these contributions increase the funds available to these 21 not-for-profit organizations, state funding to these 22 organizations will be reduced, offsetting any loss in state 23 revenue which results from the insurance premium tax credit. 24 (2) AUTHORIZATION TO GRANT STATE CONTRACT PROVIDER 25 CONTRIBUTION TAX CREDITS.-- 26 (a) For each taxable year that begins on or after July 27 1, 1997, there is allowed a credit against any tax due under 28 s. 624.509 or s. 624.510 for the taxable year in the amount of 29 25 percent of the difference between the taxpayer's state 30 contract provider contributions for the current tax year and 31 9 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 the taxpayer's state contract provider contributions for the 2 previous tax year. 3 (b) Tax credits must be approved in advance by the 4 Executive Director of the Department of Revenue and by the 5 head of the agency that directly supervises the state-funded 6 activities of the recipient not-for-profit organization. 7 (c) If a credit that is granted under this section is 8 not fully used in any one year because a taxpayer owes an 9 insufficient amount of tax under this chapter, the unused 10 portion of the credit may be carried forward for a period not 11 to exceed 5 years. The carryover credit may be used in a 12 subsequent year in which the tax imposed under s. 624.509 or 13 s. 624.510 exceeds the amount of the tax credit that is 14 allowed under this section for that year. 15 (d) A taxpayer who is eligible to receive the credit 16 provided for in s. 220.185 is ineligible to receive the credit 17 provided for in this section. 18 (3) ELIGIBILITY REQUIREMENTS.-- 19 (a) Each state contract provider contribution made by 20 an insurer must be in the form of cash or liquid assets. 21 (b) All state contract provider contributions must be 22 used by the recipient organization exclusively for providing 23 those types of services which are funded in the General 24 Appropriations Act for the current year. 25 (c) All state provider contributions must be made to 26 qualifying recipient organizations. As used in this section, 27 the term "qualifying recipient organization" means an 28 organization that: 29 1. Is a not-for-profit corporation that is exempt from 30 taxation under s. 501(c)(3) of the Internal Revenue Code of 31 1986 as amended and that is under contract to a state agency 10 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 and receives funding through the General Appropriations Act in 2 the current fiscal year; 3 2. Is fulfilling its state contract satisfactorily, as 4 certified by the head of the agency that directly supervises 5 its state-funded activities; 6 3. Has sufficient unspent appropriated funds in its 7 contract to allow the state to withhold funds in an amount 8 equal to 25 percent of the creditable contribution; and 9 4. Has demonstrated to the head of the supervising 10 agency a need for funds in an amount greater than that 11 appropriated by the state. 12 (4) APPLICATION REQUIREMENTS.-- 13 (a) An insurer that wishes to participate in this 14 program must submit to the Department of Revenue an 15 application for tax credit which sets forth the name of the 16 qualifying recipient organization, the amount of the proposed 17 contribution, and the amount of the contribution the taxpayer 18 made to the organization in the previous tax year. 19 (b) The insurer must submit a separate application for 20 tax credit for each individual contribution that it proposes 21 to contribute to each qualifying recipient organization. 22 (5) ADMINISTRATION.-- 23 (a) The Department of Revenue may adopt all rules 24 necessary for the administration of this section, including 25 rules for approving or disapproving proposals that are 26 submitted by insurers. 27 (b) Each state agency that supervises one or more 28 not-for-profit state contract provider organizations that meet 29 the criteria for qualifying to be recipient organizations must 30 provide to the Department of Revenue a list of all such 31 organizations supervised by the agency. 11 CODING: Words stricken are deletions; words underlined are additions. Florida House of Representatives - 1997 HB 809 503-144-97 1 (c) The Department of Revenue shall maintain a list of 2 eligible recipients, shall mail copies of the list to all 3 insurers that are subject to tax under this code, and shall 4 also post the list on the Internet. 5 (d) The Department of Revenue may approve a state 6 contract provider contribution only if there are sufficient 7 unspent appropriations in the recipient's state contract to 8 allow the state to withhold funds equal to 25 percent of the 9 creditable contribution. As used in this subsection, the term 10 "creditable contribution" means the difference between the 11 amounts that the recipient received from a taxpayer in the 12 current taxable year and in the previous taxable year, 13 respectively. 14 (e) Upon approval of a state contract provider 15 contribution, the Department of Revenue shall direct the 16 agency directly supervising the recipient organization to 17 prepare a budget amendment that reduces the amount of the 18 appropriation that the recipient organization is to receive by 19 25 percent of the amount of the creditable contribution. In 20 addition, the agency shall prepare a budget amendment that 21 transfers to the General Revenue Fund unspent funds in an 22 amount that offsets the cost of the insurance premium tax 23 credit. 24 Section 6. This act shall take effect July 1, 1997. 25 26 ***************************************** 27 SENATE SUMMARY 28 Provides tax credits against either the intangibles tax, the corporate income tax, or the insurance premium tax, 29 as appropriate, for charitable contributions to state contract providers. Provides for a reduction in state 30 funding of recipient organizations. 31 12