HB 0027B 2003
1	A bill to be entitled
2	An act relating to firefighter and municipal police
3	pensions; creating ss. 175.1015 and 185.085, F.S.;
4	requiring the Department of Revenue to create and
5	maintain a database for use by insurers for certain
6	purposes; providing insurers with incentives for using
7	the database; providing penalties for failure to use the
8	database; requiring local governments to provide
9	information to the department; appropriating funds to the
10	department for the administration of the database;
11	authorizing the department to adopt rules; providing for
12	distribution of certain tax revenues through 2007;
13	providing for basing future distributions of excise tax
14	revenues to certain municipalities and special fire
15	control districts upon calendar year 2003 distributions;
16	providing for future repeal; amending ss. 175.351 and
17	185.35, F.S.; revising the term "extra benefits" with
18	respect to pension plans for firefighters and pension
19	plans for municipal police officers; providing an
20	appropriation; providing for construction of the act in
21	pari materia with laws enacted during the 2003 Regular
22	Session or the 2003 Special Session A of the Legislature;
23	providing an effective date.
24
25	Be It Enacted by the Legislature of the State of Florida:
26
27	Section 1. Section 175.1015, Florida Statutes, is created
28	to read:
29	175.1015 Determination of local premium tax situs.--
30	(1)(a) Any insurance company that is obligated to report
31	and remit the excise tax on property insurance premiums imposed
32	under s. 175.101 shall be held harmless from any liability for
33	taxes, interest, or penalties that would otherwise be due solely
34	as a result of an assignment of an insured property to an
35	incorrect local taxing jurisdiction if the insurance company
36	exercises due diligence in applying an electronic database
37	provided by the Department of Revenue under subsection (2).
38	Insurance companies that do not use the electronic database
39	provided by the Department of Revenue or that do not exercise
40	due diligence in applying the electronic database are subject to
41	a 0.5-percent penalty on the portion of the premium pertaining
42	to any insured risk that is improperly assigned, whether
43	assigned to an improper local taxing jurisdiction, not assigned
44	to a local taxing jurisdiction when it should be assigned to a
45	local taxing jurisdiction, or assigned to a local taxing
46	jurisdiction when it should not be assigned to a local taxing
47	jurisdiction.
48	(b) Any insurance company that is obligated to report and
49	remit the excise tax on commercial property insurance premiums
50	imposed under s. 175.101 and is unable, after due diligence, to
51	assign an insured property to a specific local taxing
52	jurisdiction for purposes of complying with paragraph (a) shall
53	remit the excise tax on commercial property insurance premiums
54	using a methodology of apportionment in a manner consistent with
55	the remittance for the 2002 calendar year.
56	(2)(a) The Department of Revenue shall, subject to
57	legislative appropriation, create as soon as practical and
58	feasible, and thereafter shall maintain, an electronic database
59	that gives due and proper regard to any format that is approved
60	by the American National Standards Institute's Accredited
61	Standards Committee X12 and that designates for each street
62	address and address range in the state, including any multiple
63	postal street addresses applicable to one street location, the
64	local taxing jurisdiction in which the street address and
65	address range is located and the appropriate code for each such
66	participating local taxing jurisdiction, identified by one
67	nationwide standard numeric code. The nationwide standard
68	numeric code must contain the same number of numeric digits, and
69	each digit or combination of digits must refer to the same level
70	of taxing jurisdiction throughout the United States and must be
71	in a format similar to FIPS 55-3 or other appropriate standard
72	approved by the Federation of Tax Administrators and the
73	Multistate Tax Commission. Each address or address range must be
74	provided in standard postal format, including the street number,
75	street number range, street name, and zip code. Each year after
76	the creation of the initial database, the Department of Revenue
77	shall annually create and maintain a database for the current
78	tax year. Each annual database must be calendar-year specific.
79	(b)1. Each participating local taxing jurisdiction shall
80	furnish to the Department of Revenue all information needed to
81	create the electronic database as soon as practical and
82	feasible. The information furnished to the Department of Revenue
83	must specify an effective date.
84	2. Each participating local taxing jurisdiction shall
85	furnish to the Department of Revenue all information needed to
86	create and update the current year's database, including changes
87	in annexations, incorporations, and reorganizations and any
88	other changes in jurisdictional boundaries, as well as changes
89	in eligibility to participate in the excise tax imposed under
90	this chapter. The information must specify an effective date and
91	must be furnished to the Department of Revenue by July 1 of the
92	current year.
93	3. The Department of Revenue shall create and update the
94	current year's database in accordance with the information
95	furnished by participating local taxing jurisdictions under
96	subparagraph 1. or subparagraph 2., as appropriate. To the
97	extent practicable, the Department of Revenue shall post each
98	new annual database on a website by September 1 of each year.
99	Each participating local taxing jurisdiction shall have access
100	to this website and, within 30 days thereafter, shall provide
101	any corrections to the Department of Revenue. The Department of
102	Revenue shall finalize the current year's database and post it
103	on a website by November 1 of the tax year. If a dispute in
104	jurisdictional boundaries cannot be resolved so that changes in
105	boundaries may be included, as appropriate, in the database by
106	November 1, the changes may not be retroactively included in the
107	current year's database and the boundaries will remain the same
108	as in the previous year's database. The finalized database must
109	be used in assigning policies and premiums to the proper local
110	taxing jurisdiction for the insurance premium tax return due on
111	the following March 1. The Department of Revenue shall furnish
112	the annual database on magnetic or electronic media to any
113	insurance company or vendor that requests the database for the
114	sole purpose of assigning insurance premiums to the proper local
115	taxing jurisdiction for the excise tax imposed under this
116	chapter. Information contained in the electronic database is
117	conclusive for purposes of this chapter. The electronic database
118	is not an order, a rule, or a policy of general applicability.
119	4. Each annual database must identify the additions,
120	deletions, and other changes to the preceding version of the
121	database.
122	(3)(a) As used in this section, the term "due diligence"
123	means the care and attention that is expected from and is
124	ordinarily exercised by a reasonable and prudent person under
125	the circumstances.
126	(b) Notwithstanding any law to the contrary, an insurance
127	company is exercising due diligence if the insurance company
128	complies with the provisions of paragraph (1)(b) or if the
129	insurance company assigns an insured's premium to local taxing
130	jurisdictions in accordance with the Department of Revenue's
131	annual database and:
132	1. Expends reasonable resources to accurately and reliably
133	implement such method;
134	2. Maintains adequate internal controls to correctly
135	include in its database of policyholders the location of the
136	property insured, in the proper address format, so that matching
137	with the department's database is accurate; and
138	3. Corrects errors in the assignment of addresses to local
139	taxing jurisdictions within 120 days after the insurance company
140	discovers the errors.
141	(4) There is annually appropriated from the moneys
142	collected under this chapter and deposited in the Police and
143	Firefighter's Premium Tax Trust Fund an amount sufficient to pay
144	the expenses of the Department of Revenue in administering this
145	section, but not to exceed $50,000 annually, adjusted annually
146	by the lesser of a 5-percent increase or the percentage of
147	growth in the total collections.
148	(5) The Department of Revenue shall adopt rules necessary
149	to administer this section, including rules establishing
150	procedures and forms.
151	(6) Any insurer that is obligated to collect and remit the
152	tax on property insurance imposed under s. 175.101 shall be held
153	harmless from liability, including, but not limited to, any tax,
154	interest, or penalties, which would otherwise be due solely as a
155	result of an assignment of an insured property to an incorrect
156	local taxing jurisdiction, based on the collection and remission
157	of the tax accruing before January 1, 2004, provided the insurer
158	collects and reports this tax consistent with filings for
159	periods before January 1, 2004. Further, any insurer that is
160	obligated to collect and remit the tax on property insurance
161	imposed under this section shall not be subject to an
162	examination under s. 624.316 or s. 624.3161 which would occur
163	solely as a result of an assignment of an insured property to an
164	incorrect local taxing jurisdiction, based on the collection and
165	remission of such tax accruing before January 1, 2004.
166	(7)(a) Notwithstanding any other provision of law, no
167	methodology, formula, or database that is adopted in any year
168	after January 1, 2004, may result in a distribution to a
169	participating municipality or special fire control district that
170	has a retirement plan created pursuant to this chapter of an
171	amount of excise tax which is less than the amount distributed
172	to such participating municipality or special fire control
173	district for calendar year 2003. However, if the total proceeds
174	to be distributed for the current year from the excise tax
175	imposed under s. 175.101 are less than the total amount
176	distributed for calendar year 2003, each participating
177	municipality shall receive a current year distribution that is
178	proportionate to its share of the total 2003 calendar year
179	distribution. If the total proceeds to be distributed for the
180	current year from the excise tax imposed under s. 175.101 is
181	greater than or equal to the total amount distributed for
182	calendar year 2003, each participating municipality and special
183	fire control district shall initially be distributed a minimum
184	amount equal to the amount received for calendar year 2003. The
185	remaining amount to be distributed for the current year, less
186	the minimum distribution amount, shall be distributed to those
187	municipalities and special fire control districts with a
188	current-year reported amount that is greater than the amount
189	distributed to such municipality or special fire control
190	district for calendar year 2003. Each municipality and special
191	fire control district eligible for distribution of this
192	remaining amount shall receive its proportionate share of the
193	remaining amount based upon the amount reported for that
194	municipality or special fire control district, greater than the
195	calendar year 2003 distribution for the current year, to the
196	total amount over the calendar year 2003 distribution for all
197	municipalities and special fire control districts with a current
198	year reported amount that is greater than the calendar year 2003
199	distribution.
200	(b) If a new municipality or special fire control district
201	elects to participate under this chapter during any year after
202	January 1, 2004, such municipality or special fire control
203	district shall receive the total amount reported for the current
204	year for such municipality or special fire control district. All
205	other participating municipalities and special fire control
206	districts shall receive a current year distribution, calculated
207	as provided in this subsection, which is proportionate to their
208	share of the total 2003 calendar year distribution after
209	subtracting the amount paid to the new participating plans.
210	(c) This subsection expires January 1, 2007.
211	Section 2. Subsection (1) of section 175.351, Florida
212	Statutes, is amended to read:
213	175.351 Municipalities and special fire control districts
214	having their own pension plans for firefighters.--For any
215	municipality, special fire control district, local law
216	municipality, local law special fire control district, or local
217	law plan under this chapter, in order for municipalities and
218	special fire control districts with their own pension plans for
219	firefighters, or for firefighters and police officers, where
220	included, to participate in the distribution of the tax fund
221	established pursuant to s. 175.101, local law plans must meet
222	the minimum benefits and minimum standards set forth in this
223	chapter.
224	(1) PREMIUM TAX INCOME.--If a municipality has a pension
225	plan for firefighters, or a pension plan for firefighters and
226	police officers, where included, which in the opinion of the
227	division meets the minimum benefits and minimum standards set
228	forth in this chapter, the board of trustees of the pension
229	plan, as approved by a majority of firefighters of the
230	municipality, may:
231	(a) Place the income from the premium tax in s. 175.101 in
232	such pension plan for the sole and exclusive use of its
233	firefighters, or for firefighters and police officers, where
234	included, where it shall become an integral part of that pension
235	plan and shall be used to pay extra benefits to the firefighters
236	included in that pension plan; or
237	(b) Place the income from the premium tax in s. 175.101 in
238	a separate supplemental plan to pay extra benefits to
239	firefighters, or to firefighters and police officers where
240	included, participating in such separate supplemental plan.
241
242	The premium tax provided by this chapter shall in all cases be
243	used in its entirety to provide extra benefits to firefighters,
244	or to firefighters and police officers, where included. However,
245	local law plans in effect on October 1, 1998, shall be required
246	to comply with the minimum benefit provisions of this chapter
247	only to the extent that additional premium tax revenues become
248	available to incrementally fund the cost of such compliance as
249	provided in s. 175.162(2)(a). When a plan is in compliance with
250	such minimum benefit provisions, as subsequent additional
251	premium tax revenues become available, they shall be used to
252	provide extra benefits. For the purpose of this chapter,
253	"additional premium tax revenues" means revenues received by a
254	municipality or special fire control district pursuant to s.
255	175.121 that exceed that amount received for calendar year 1997
256	and the term "extra benefits" means benefits in addition to or
257	greater than those provided to general employees of the
258	municipality and in addition to those in existence for
259	firefighters on March 12, 1999. Local law plans created by
260	special act before May 23, 1939, shall be deemed to comply with
261	this chapter.
262	Section 3. Section 185.085, Florida Statutes, is created
263	to read:
264	185.085 Determination of local premium tax situs.--
265	(1)(a) Any insurance company that is obligated to report
266	and remit the excise tax on casualty insurance premiums imposed
267	under s. 185.08 shall be held harmless from any liability for
268	taxes, interest, or penalties that would otherwise be due solely
269	as a result of an assignment of an insured property to an
270	incorrect local taxing jurisdiction if the insurance company
271	exercises due diligence in applying an electronic database
272	provided by the Department of Revenue under subsection (2).
273	Insurance companies that do not use the electronic database
274	provided by the Department of Revenue or that do not exercise
275	due diligence in applying the electronic database are subject to
276	a 0.5-percent penalty on the portion of the premium pertaining
277	to any insured risk that is improperly assigned, whether
278	assigned to an improper local taxing jurisdiction, not assigned
279	to a local taxing jurisdiction when it should be assigned to a
280	local taxing jurisdiction, or assigned to a local taxing
281	jurisdiction when it should not be assigned to a local taxing
282	jurisdiction.
283	(b) Any insurance company that is obligated to report and
284	remit the excise tax on commercial casualty insurance premiums
285	imposed under s. 185.08 and is unable, after due diligence, to
286	assign an insured property to a specific local taxing
287	jurisdiction for purposes of complying with paragraph (a) shall
288	remit the excise tax on commercial casualty insurance premiums
289	using a methodology of apportionment in a manner consistent with
290	the remittance for the 2002 calendar year.
291	(2)(a) The Department of Revenue shall, subject to
292	legislative appropriation, create as soon as practical and
293	feasible, and thereafter shall maintain, an electronic database
294	that gives due and proper regard to any format that is approved
295	by the American National Standards Institute's Accredited
296	Standards Committee X12 and that designates for each street
297	address and address range in the state, including any multiple
298	postal street addresses applicable to one street location, the
299	local taxing jurisdiction in which the street address and
300	address range is located and the appropriate code for each such
301	participating local taxing jurisdiction, identified by one
302	nationwide standard numeric code. The nationwide standard
303	numeric code must contain the same number of numeric digits, and
304	each digit or combination of digits must refer to the same level
305	of taxing jurisdiction throughout the United States and must be
306	in a format similar to FIPS 55-3 or other appropriate standard
307	approved by the Federation of Tax Administrators and the
308	Multistate Tax Commission. Each address or address range must be
309	provided in standard postal format, including the street number,
310	street number range, street name, and zip code. Each year after
311	the creation of the initial database, the Department of Revenue
312	shall annually create and maintain a database for the current
313	tax year. Each annual database must be calendar-year specific.
314	(b)1. Each participating local taxing jurisdiction shall
315	furnish to the Department of Revenue all information needed to
316	create the electronic database as soon as practical and
317	feasible. The information furnished to the Department of Revenue
318	must specify an effective date.
319	2. Each participating local taxing jurisdiction shall
320	furnish to the Department of Revenue all information needed to
321	create and update the current year's database, including changes
322	in annexations, incorporations, and reorganizations and any
323	other changes in jurisdictional boundaries, as well as changes
324	in eligibility to participate in the excise tax imposed under
325	this chapter. The information must specify an effective date and
326	must be furnished to the Department of Revenue by July 1 of the
327	current year.
328	3. The Department of Revenue shall create and update the
329	current year's database in accordance with the information
330	furnished by participating local taxing jurisdictions under
331	subparagraph 1. or subparagraph 2., as appropriate. To the
332	extent practicable, the Department of Revenue shall post each
333	new annual database on a website by September 1 of each year.
334	Each participating local taxing jurisdiction shall have access
335	to this website and, within 30 days thereafter, shall provide
336	any corrections to the Department of Revenue. The Department of
337	Revenue shall finalize the current year's database and post it
338	on a website by November 1 of the tax year. If a dispute in
339	jurisdictional boundaries cannot be resolved so that changes in
340	boundaries may be included, as appropriate, in the database by
341	November 1, the changes may not be retroactively included in the
342	current year's database and the boundaries will remain the same
343	as in the previous year's database. The finalized database must
344	be used in assigning policies and premiums to the proper local
345	taxing jurisdiction for the insurance premium tax return due on
346	the following March 1. The Department of Revenue shall furnish
347	the annual database on magnetic or electronic media to any
348	insurance company or vendor that requests the database for the
349	sole purpose of assigning insurance premiums to the proper local
350	taxing jurisdiction for the excise tax imposed under this
351	chapter. Information contained in the electronic database is
352	conclusive for purposes of this chapter. The electronic database
353	is not an order, a rule, or a policy of general applicability.
354	4. Each annual database must identify the additions,
355	deletions, and other changes to the preceding version of the
356	database.
357	(3)(a) As used in this section, the term "due diligence"
358	means the care and attention that is expected from and is
359	ordinarily exercised by a reasonable and prudent person under
360	the circumstances.
361	(b) Notwithstanding any law to the contrary, an insurance
362	company is exercising due diligence if the insurance company
363	complies with the provisions of paragraph (1)(b) or if the
364	insurance company assigns an insured's premium to local taxing
365	jurisdictions in accordance with the Department of Revenue's
366	annual database and:
367	1. Expends reasonable resources to accurately and reliably
368	implement such method;
369	2. Maintains adequate internal controls to correctly
370	include in its database of policyholders the location of the
371	property insured, in the proper address format, so that matching
372	with the department's database is accurate; and
373	3. Corrects errors in the assignment of addresses to local
374	taxing jurisdictions within 120 days after the insurance company
375	discovers the errors.
376	(4) There is annually appropriated from the moneys
377	collected under this chapter and deposited in the Police and
378	Firefighter's Premium Tax Trust Fund an amount sufficient to pay
379	the expenses of the Department of Revenue in administering this
380	section, but not to exceed $50,000 annually, adjusted annually
381	by the lesser of a 5-percent increase or the percentage of
382	growth in the total collections.
383	(5) The Department of Revenue shall adopt rules necessary
384	to administer this section, including rules establishing
385	procedures and forms.
386	(6)(a) Notwithstanding any other provision of law, no
387	methodology, formula, or database that is adopted in any year
388	after January 1, 2004, may result in a distribution to a
389	participating municipality that has a retirement plan created
390	pursuant to this chapter of an amount of excise tax which is
391	less than the amount distributed to such participating
392	municipality for calendar year 2003. However, if the total
393	proceeds to be distributed for the current year from the excise
394	tax imposed under s. 185.08 are less than the total amount
395	distributed for calendar year 2003, each participating
396	municipality shall receive a current year distribution that is
397	proportionate to its share of the total 2003 calendar year
398	distribution. If the total proceeds to be distributed for the
399	current year from the excise tax imposed under s. 185.08 are
400	greater than or equal to the total amount distributed for
401	calendar year 2003, each participating municipality shall
402	initially be distributed a minimum amount equal to the amount
403	received for calendar year 2003. The remaining amount to be
404	distributed for the current year, which equals the total to be
405	distributed for the current year less minimum distribution
406	amount shall be distributed to those municipalities with a
407	current-year reported amount that is greater than the amount
408	distributed to such municipality for calendar year 2003. Each
409	municipality eligible for distribution of this remaining amount
410	shall receive its proportionate share of the remaining amount
411	based upon the amount reported for that municipality, above the
412	calendar year 2003 distribution for the current year, to the
413	total amount over the calendar year 2003 distribution for all
414	municipalities with a current year reported amount that is
415	greater than the calendar year 2003 distribution.
416	(b) If a new municipality elects to participate under this
417	chapter during any year after January 1, 2004, such municipality
418	shall receive the total amount reported for the current year for
419	such municipality. All other participating municipalities shall
420	receive a current year distribution, calculated as provided in
421	this section, which is proportionate to their share of the total
422	2003 calendar year distribution after subtracting the amount
423	paid to the new participating plans.
424	(c) This subsection expires January 1, 2007.
425	(7) Any insurer that is obligated to collect and remit the
426	tax on casualty insurance imposed under s. 185.08 shall be held
427	harmless from liability, including, but not limited to, any tax,
428	interest, or penalties, which would otherwise be due solely as a
429	result of an assignment of an insured risk to an incorrect local
430	taxing jurisdiction, based on the collection and remission of
431	the tax accruing before January 1, 2004, provided the insurer
432	collects and reports this tax consistent with filings for
433	periods before January 1, 2004. Further, any insurer that is
434	obligated to collect and remit the tax on casualty insurance
435	imposed under this section shall not be subject to an
436	examination under s. 624.316 or s. 624.3161 which would occur
437	solely as a result of an assignment of an insured risk to an
438	incorrect local taxing jurisdiction, based on the collection and
439	remission of such tax accruing before January 1, 2004.
440	Section 4. Subsection (1) of section 185.35, Florida
441	Statutes, is amended to read:
442	185.35 Municipalities having their own pension plans for
443	police officers.--For any municipality, chapter plan, local law
444	municipality, or local law plan under this chapter, in order for
445	municipalities with their own pension plans for police officers,
446	or for police officers and firefighters where included, to
447	participate in the distribution of the tax fund established
448	pursuant to s. 185.08, local law plans must meet the minimum
449	benefits and minimum standards set forth in this chapter:
450	(1) PREMIUM TAX INCOME.--If a municipality has a pension
451	plan for police officers, or for police officers and
452	firefighters where included, which, in the opinion of the
453	division, meets the minimum benefits and minimum standards set
454	forth in this chapter, the board of trustees of the pension
455	plan, as approved by a majority of police officers of the
456	municipality, may:
457	(a) Place the income from the premium tax in s. 185.08 in
458	such pension plan for the sole and exclusive use of its police
459	officers, or its police officers and firefighters where
460	included, where it shall become an integral part of that pension
461	plan and shall be used to pay extra benefits to the police
462	officers included in that pension plan; or
463	(b) May place the income from the premium tax in s. 185.08
464	in a separate supplemental plan to pay extra benefits to the
465	police officers, or police officers and firefighters where
466	included, participating in such separate supplemental plan.
467
468	The premium tax provided by this chapter shall in all cases be
469	used in its entirety to provide extra benefits to police
470	officers, or to police officers and firefighters, where
471	included. However, local law plans in effect on October 1, 1998,
472	shall be required to comply with the minimum benefit provisions
473	of this chapter only to the extent that additional premium tax
474	revenues become available to incrementally fund the cost of such
475	compliance as provided in s. 185.16(2). When a plan is in
476	compliance with such minimum benefit provisions, as subsequent
477	additional tax revenues become available, they shall be used to
478	provide extra benefits. For the purpose of this chapter,
479	"additional premium tax revenues" means revenues received by a
480	municipality pursuant to s. 185.10 that exceed the amount
481	received for calendar year 1997 and the term "extra benefits"
482	means benefits in addition to or greater than those provided to
483	general employees of the municipality and in addition to those
484	in existence for police officers on March 12, 1999. Local law
485	plans created by special act before May 23, 1939, shall be
486	deemed to comply with this chapter.
487	Section 5. The sum of $300,000 is appropriated from the
488	General Revenue Fund to the Department of Revenue for the one-
489	time expense of creating the original database called for by ss.
490	175.1015 and 185.085, Florida Statutes, as created by this act,
491	and to begin the implementation process for use of the database.
492	It is the intent of the Legislature in providing this
493	appropriation that the database for ss. 175.1015 and 185.085,
494	Florida Statutes, as created by this act, be available for use
495	in determining the allocation of premiums to the various
496	municipalities and special fire control districts for the 2004
497	insurance premium tax return that is due by March 1, 2005.
498	Section 6. If any law amended by this act was also amended
499	by a law enacted at the 2003 Regular Session of the Legislature
500	or at the 2003 Special Session A of the Legislature, such laws
501	shall be construed as if they had been enacted at the same
502	session of the Legislature, and full effect shall be given to
503	each if possible.
504	Section 7. This act shall take effect January 1, 2004.