House Bill 0395

    Florida House of Representatives - 2000                 HB 395

        By Representative Patterson






  1                      A bill to be entitled

  2         An act relating to ad valorem tax exemptions;

  3         amending s. 196.012, F.S.; providing that, for

  4         purposes of determining eligibility for

  5         exemption, property which is owned by an exempt

  6         entity under a capital lease shall be deemed

  7         "owned" by the entity; defining "capital

  8         lease"; providing an effective date.

  9

10  Be It Enacted by the Legislature of the State of Florida:

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12         Section 1.  Subsection (20) is added to section

13  196.012, Florida Statutes, to read:

14         196.012  Definitions.--For the purpose of this chapter,

15  the following terms are defined as follows, except where the

16  context clearly indicates otherwise:

17         (20)  For purposes of determining if property is

18  "owned" by an exempt entity, property owned by the entity

19  under a capital lease shall be deemed to be owned by the

20  entity. A "capital lease" is a lease which meets at least one

21  of the following criteria:

22         (a)  Ownership of the property transfers to the lessee

23  at the end of the lease term.

24         (b)  The lease contains a bargain purchase option,

25  which is a provision allowing the lessee, at his or her

26  choosing, to buy the leased property for a price which is

27  sufficiently lower than the expected fair market value of the

28  property at the date the option becomes exercisable that

29  exercise of the option appears, at the inception of the lease,

30  to be reasonably assured.

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CODING: Words stricken are deletions; words underlined are additions.






    Florida House of Representatives - 2000                 HB 395

    719-110-00






  1         (c)  The lease term is equal to 75 percent or more of

  2  the estimated useful economic life of the property.

  3         (d)  At the inception of the lease, the present value

  4  of the minimum lease payments is at least 90 percent of the

  5  fair market value of the leased property. As used in this

  6  paragraph, "minimum lease payments" has the same meaning as is

  7  contained in Statements and Interpretations of the Financial

  8  Accounting Standards Board in regard to capital-type leases.

  9  The interest rate used to calculate the present value shall be

10  the Prime Rate published in the "Money Rates" section of the

11  Wall Street Journal on the same date as the inception of the

12  lease.

13         Section 2.  This act shall take effect January 1, 2001.

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16                          HOUSE SUMMARY

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      Provides that, for purposes of determining eligibility
18    for ad valorem tax exemption, property which is owned by
      an exempt entity under a capital lease shall be deemed
19    "owned" by the entity, and defines "capital lease."

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