HB 0251 2004
1	A bill to be entitled
2	An act relating to firefighter and municipal police
3	pensions; creating s. 175.1015, F.S.; authorizing the
4	Department of Revenue to create and maintain a database
5	for use by insurers that report and remit an excise tax on
6	property insurance premiums; providing incentives to
7	insurers for using the database and penalties for failure
8	to use the database; requiring local governments to
9	provide information to the department; appropriating funds
10	to the department for the administration of the database;
11	authorizing the department to adopt rules; creating s.
12	185.085, F.S.; authorizing the Department of Revenue to
13	create and maintain a database for use by insurers that
14	report and remit an excise tax on casualty insurers
15	premiums; providing incentives to insurers for using the
16	database and penalties for failure to use the database;
17	requiring local governments to provide information to the
18	department; appropriating funds to the department for the
19	administration of the database; authorizing the department
20	to adopt rules; providing for distribution of tax revenues
21	through 2007; amending s. 175.351, F.S.; providing for the
22	meaning of the term "extra benefits" with respect to
23	pension plans for firefighters; amending s. 185.35, F.S.;
24	providing for the meaning of the term "extra benefits"
25	with respect to pension plans for municipal police
26	officers; amending s. 175.061, F.S.; authorizing the plan
27	administrator to withhold certain funds; amending s.
28	185.05, F.S.; authorizing the plan administrator to
29	withhold certain funds; providing an appropriation to the
30	Department of Revenue; providing an effective date.
31
32	Be It Enacted by the Legislature of the State of Florida:
33
34	Section 1. Section 175.1015, Florida Statutes, is created
35	to read:
36	175.1015 Determination of local premium tax situs.--
37	(1)(a) Any insurance company that is obligated to report
38	and remit the excise tax on property insurance premiums imposed
39	under s. 175.101 shall be held harmless from any liability for
40	taxes, interest, or penalties that would otherwise be due solely
41	as a result of an assignment of an insured property to an
42	incorrect local taxing jurisdiction if the insurance company
43	exercises due diligence in applying an electronic database
44	provided by the Department of Revenue under subsection (2).
45	Insurance companies that do not use the electronic database
46	provided by the Department of Revenue or that do not exercise
47	due diligence in applying the electronic database are subject to
48	a 0.5-percent penalty on the portion of the premium pertaining
49	to any insured risk that is improperly assigned, whether
50	assigned to an improper local taxing jurisdiction, not assigned
51	to a local taxing jurisdiction when it should be assigned to a
52	local taxing jurisdiction, or assigned to a local taxing
53	jurisdiction when it should not be assigned to a local taxing
54	jurisdiction.
55	(b) Any insurance company that is obligated to report and
56	remit the excise tax on commercial property insurance premiums
57	imposed under s. 175.101 and is unable, after due diligence, to
58	assign an insured property to a specific local taxing
59	jurisdiction for purposes of complying with paragraph (a) shall
60	remit the excise tax on commercial property insurance premiums
61	using a methodology of apportionment in a manner consistent with
62	the remittance for the 2002 calendar year.
63	(2)(a) The Department of Revenue shall, subject to
64	legislative appropriation, create as soon as practicable and
65	feasible, and thereafter shall maintain, an electronic database
66	that conforms to any format approved by the American National
67	Standards Institute's Accredited Standards Committee X12 and
68	that designates for each street address and address range in the
69	state, including any multiple postal street addresses applicable
70	to one street location, the local taxing jurisdiction in which
71	the street address and address range is located, and the
72	appropriate code for each such participating local taxing
73	jurisdiction, identified by one nationwide standard numeric
74	code. The nationwide standard numeric code must contain the same
75	number of numeric digits, and each digit or combination of
76	digits must refer to the same level of taxing jurisdiction
77	throughout the United States and must be in a format similar to
78	FIPS 55-3 or other appropriate standard approved by the
79	Federation of Tax Administrators and the Multistate Tax
80	Commission. Each address or address range must be provided in
81	standard postal format, including the street number, street
82	number range, street name, and zip code. Each year after the
83	creation of the initial database, the Department of Revenue
84	shall annually create and maintain a database for the current
85	tax year. Each annual database must be calendar-year specific.
86	(b)1. Each participating local taxing jurisdiction shall
87	furnish to the Department of Revenue all information needed to
88	create the electronic database as soon as practicable and
89	feasible. The information furnished to the Department of Revenue
90	must specify an effective date.
91	2. Each participating local taxing jurisdiction shall
92	furnish to the Department of Revenue all information needed to
93	create and update the current year's database, including changes
94	in annexations, incorporations, and reorganizations and any
95	other changes in jurisdictional boundaries, as well as changes
96	in eligibility to participate in the excise tax imposed under
97	this chapter. The information must specify an effective date and
98	must be furnished to the Department of Revenue by July 1 of the
99	current year.
100	3. The Department of Revenue shall create and update the
101	current year's database in accordance with the information
102	furnished by participating local taxing jurisdictions under
103	subparagraph 1. or subparagraph 2., as appropriate. To the
104	extent practicable, the Department of Revenue shall post each
105	new annual database on a website by September 1 of each year.
106	Each participating local taxing jurisdiction shall have access
107	to this website and, within 30 days thereafter, shall provide
108	any corrections to the Department of Revenue. The Department of
109	Revenue shall finalize the current year's database and post it
110	on a website by November 1 of the tax year. If a dispute in
111	jurisdictional boundaries cannot be resolved so that changes in
112	boundaries may be included, as appropriate, in the database by
113	November 1, the changes may not be retroactively included in the
114	current year's database and the boundaries will remain the same
115	as in the previous year's database. The finalized database must
116	be used in assigning policies and premiums to the proper local
117	taxing jurisdiction for the insurance premium tax return due on
118	the following March 1. The Department of Revenue shall furnish
119	the annual database on magnetic or electronic media to any
120	insurance company or vendor that requests the database for the
121	sole purpose of assigning insurance premiums to the proper local
122	taxing jurisdiction for the excise tax imposed under this
123	chapter. Information contained in the electronic database is
124	conclusive for purposes of this chapter. The electronic database
125	is not an order, a rule, or a policy of general applicability.
126	4. Each annual database must identify the additions,
127	deletions, and other changes to the preceding version of the
128	database.
129	(3)(a) As used in this section, the term "due diligence"
130	means the care and attention that is expected from and is
131	ordinarily exercised by a reasonable and prudent person under
132	the circumstances.
133	(b) Notwithstanding any law to the contrary, an insurance
134	company is exercising due diligence if the insurance company
135	complies with the provisions of paragraph (1)(b) or if the
136	insurance company assigns an insured's premium to local taxing
137	jurisdictions in accordance with the Department of Revenue's
138	annual database and:
139	1. Expends reasonable resources to accurately and reliably
140	implement such method;
141	2. Maintains adequate internal controls to correctly
142	include in its database of policyholders the location of the
143	property insured, in the proper address format, so that matching
144	with the department's database is accurate; and
145	3. Corrects errors in the assignment of addresses to local
146	taxing jurisdictions within 120 days after the insurance company
147	discovers the errors.
148	(4) There is annually appropriated from the moneys
149	collected under this chapter and deposited in the Police and
150	Firefighters' Premium Tax Trust Fund an amount sufficient to pay
151	the expenses of the Department of Revenue in administering this
152	section, but not to exceed $50,000 annually, adjusted annually
153	by the lesser of a 5-percent increase or the percentage of
154	growth in the total collections.
155	(5) The Department of Revenue shall adopt rules necessary
156	to administer this section, including rules establishing
157	procedures and forms.
158	(6) Any insurer that is obligated to collect and remit the
159	tax on property insurance imposed under s. 175.101 shall be held
160	harmless from any liability for taxes, interest, or penalties
161	that would otherwise be due solely as a result of an assignment
162	of an insured property to an incorrect local taxing
163	jurisdiction, based on the collection and remission of the tax
164	accruing before January 1, 2005, if the insurer collects and
165	reports this tax consistent with filings for periods before
166	January 1, 2005. Further, any insurer that is obligated to
167	collect and remit the tax on property insurance imposed under
168	this section is not subject to an examination under s. 624.316
169	or s. 624.3161 which would occur solely as a result of an
170	assignment of an insured property to an incorrect local taxing
171	jurisdiction, based on the collection and remission of such tax
172	accruing before January 1, 2004.
173	Section 2. Section 185.085, Florida Statutes, is created
174	to read:
175	185.085 Determination of local premium tax situs.--
176	(1)(a) Any insurance company that is obligated to report
177	and remit the excise tax on casualty insurance premiums imposed
178	under s. 185.08 shall be held harmless from any liability for
179	taxes, interest, or penalties that would otherwise be due solely
180	as a result of an assignment of an insured property to an
181	incorrect local taxing jurisdiction if the insurance company
182	exercises due diligence in applying an electronic database
183	provided by the Department of Revenue under subsection (2).
184	Insurance companies that do not use the electronic database
185	provided by the Department of Revenue or that do not exercise
186	due diligence in applying the electronic database are subject to
187	a 0.5-percent penalty on the portion of the premium pertaining
188	to any insured risk that is improperly assigned, whether
189	assigned to an improper local taxing jurisdiction, not assigned
190	to a local taxing jurisdiction when it should be assigned to a
191	local taxing jurisdiction, or assigned to a local taxing
192	jurisdiction when it should not be assigned to a local taxing
193	jurisdiction.
194	(b) Any insurance company that is obligated to report and
195	remit the excise tax on commercial casualty insurance premiums
196	imposed under s. 185.08 and is unable, after due diligence, to
197	assign an insured property to a specific local taxing
198	jurisdiction for purposes of complying with paragraph (a) shall
199	remit the excise tax on commercial casualty insurance premiums
200	using a methodology of apportionment in a manner consistent with
201	the remittance for the 2002 calendar year.
202	(2)(a) The Department of Revenue shall, subject to
203	legislative appropriation, create as soon as practicable and
204	feasible, and thereafter shall maintain, an electronic database
205	that conforms to any format approved by the American National
206	Standards Institute's Accredited Standards Committee X12 and
207	that designates for each street address and address range in the
208	state, including any multiple postal street addresses applicable
209	to one street location, the local taxing jurisdiction in which
210	the street address and address range is located, and the
211	appropriate code for each such participating local taxing
212	jurisdiction, identified by one nationwide standard numeric
213	code. The nationwide standard numeric code must contain the same
214	number of numeric digits, and each digit or combination of
215	digits must refer to the same level of taxing jurisdiction
216	throughout the United States and must be in a format similar to
217	FIPS 55-3 or other appropriate standard approved by the
218	Federation of Tax Administrators and the Multistate Tax
219	Commission. Each address or address range must be provided in
220	standard postal format, including the street number, street
221	number range, street name, and zip code. Each year after the
222	creation of the initial database, the Department of Revenue
223	shall annually create and maintain a database for the current
224	tax year. Each annual database must be calendar-year specific.
225	(b)1. Each participating local taxing jurisdiction shall
226	furnish to the Department of Revenue all information needed to
227	create the electronic database as soon as practicable and
228	feasible. The information furnished to the Department of Revenue
229	must specify an effective date.
230	2. Each participating local taxing jurisdiction shall
231	furnish to the Department of Revenue all information needed to
232	create and update the current year's database, including changes
233	in annexations, incorporations, and reorganizations and any
234	other changes in jurisdictional boundaries, as well as changes
235	in eligibility to participate in the excise tax imposed under
236	this chapter. The information must specify an effective date and
237	must be furnished to the Department of Revenue by July 1 of the
238	current year.
239	3. The Department of Revenue shall create and update the
240	current year's database in accordance with the information
241	furnished by participating local taxing jurisdictions under
242	subparagraph 1. or subparagraph 2., as appropriate. To the
243	extent practicable, the Department of Revenue shall post each
244	new annual database on a website by September 1 of each year.
245	Each participating local taxing jurisdiction shall have access
246	to this website and, within 30 days thereafter, shall provide
247	any corrections to the Department of Revenue. The Department of
248	Revenue shall finalize the current year's database and post it
249	on a website by November 1 of the tax year. If a dispute in
250	jurisdictional boundaries cannot be resolved so that changes in
251	boundaries may be included, as appropriate, in the database by
252	November 1, the changes may not be retroactively included in the
253	current year's database and the boundaries will remain the same
254	as in the previous year's database. The finalized database must
255	be used in assigning policies and premiums to the proper local
256	taxing jurisdiction for the insurance premium tax return due on
257	the following March 1. The Department of Revenue shall furnish
258	the annual database on magnetic or electronic media to any
259	insurance company or vendor that requests the database for the
260	sole purpose of assigning insurance premiums to the proper local
261	taxing jurisdiction for the excise tax imposed under this
262	chapter. Information contained in the electronic database is
263	conclusive for purposes of this chapter. The electronic database
264	is not an order, a rule, or a policy of general applicability.
265	4. Each annual database must identify the additions,
266	deletions, and other changes to the preceding version of the
267	database.
268	(3)(a) As used in this section, the term "due diligence"
269	means the care and attention that is expected from and is
270	ordinarily exercised by a reasonable and prudent person under
271	the circumstances.
272	(b) Notwithstanding any law to the contrary, an insurance
273	company is exercising due diligence if the insurance company
274	complies with the provisions of paragraph (1)(b) or if the
275	insurance company assigns an insured's premium to local taxing
276	jurisdictions in accordance with the Department of Revenue's
277	annual database and:
278	1. Expends reasonable resources to accurately and reliably
279	implement such method;
280	2. Maintains adequate internal controls to correctly
281	include in its database of policyholders the location of the
282	property insured, in the proper address format, so that matching
283	with the department's database is accurate; and
284	3. Corrects errors in the assignment of addresses to local
285	taxing jurisdictions within 120 days after the insurance company
286	discovers the errors.
287	(4) There is annually appropriated from the moneys
288	collected under this chapter and deposited in the Police and
289	Firefighters' Premium Tax Trust Fund an amount sufficient to pay
290	the expenses of the Department of Revenue in administering this
291	section, but not to exceed $50,000 annually, adjusted annually
292	by the lesser of a 5-percent increase or the percentage of
293	growth in the total collections.
294	(5) The Department of Revenue shall adopt rules necessary
295	to administer this section, including rules establishing
296	procedures and forms.
297	(6)(a) Notwithstanding any other law, no methodology,
298	formula, or database that is adopted in any year after January
299	1, 2005, may result in a distribution to a participating
300	municipality that has a retirement plan created pursuant to this
301	chapter of an amount of excise tax which is less than the amount
302	distributed to such participating municipality for calendar year
303	2004. However, if the total proceeds to be distributed for the
304	current year from the excise tax imposed under s. 185.08 are
305	less than the total amount distributed for calendar year 2004,
306	each participating municipality shall receive a current-year
307	distribution that is proportionate to its share of the total
308	2003 calendar year distribution. If the total of the proceeds to
309	be distributed for the current year from the excise tax imposed
310	under s. 185.08 are greater than or equal to the total amount
311	distributed for calendar year 2004, each participating
312	municipality shall initially be distributed a minimum amount
313	equal to the amount received for calendar year 2004. The
314	remaining amount to be distributed for the current year, which
315	equals the total to be distributed for the current year, less
316	minimum distribution amount, shall be distributed to those
317	municipalities with a current-year reported amount that is
318	greater than the amount distributed to such municipality for
319	calendar year 2004. Each municipality eligible for distribution
320	of this remaining amount shall receive its proportionate share
321	of the remaining amount based upon the amount reported for that
322	municipality, above the calendar year 2004 distribution for the
323	current year, to the total amount over the calendar year 2004
324	distribution for all municipalities with a current-year reported
325	amount that is greater than the calendar year 2004 distribution.
326	(b) If a new municipality elects to participate under this
327	chapter during any year after January 1, 2005, such municipality
328	shall receive the total amount reported for the current year for
329	such municipality. All other participating municipalities shall
330	receive a current-year distribution, calculated as provided in
331	this section, which is proportionate to their share of the total
332	2004 calendar year distribution after subtracting the amount
333	paid to the new participating plans.
334	(c) This subsection expires January 1, 2008.
335	(7) Any insurer that is obligated to collect and remit the
336	tax on casualty insurance imposed under s. 185.08 shall be held
337	harmless from any liability for taxes, interest, or penalties
338	that would otherwise be due solely as a result of an assignment
339	of an insured risk to an incorrect local taxing jurisdiction,
340	based on the collection and remission of the tax accruing before
341	January 1, 2005, if the insurer collects and reports this tax
342	consistent with filings for periods before January 1, 2005.
343	Further, any insurer that is obligated to collect and remit the
344	tax on casualty insurance imposed under this section is not
345	subject to an examination under s. 624.316 or s. 624.3161 which
346	would occur solely as a result of an assignment of an insured
347	risk to an incorrect local taxing jurisdiction, based on the
348	collection and remission of such tax accruing before the
349	effective date of this section.
350	Section 3. Subsection (1) of section 175.351, Florida
351	Statutes, is amended to read:
352	175.351 Municipalities and special fire control districts
353	having their own pension plans for firefighters.--For any
354	municipality, special fire control district, local law
355	municipality, local law special fire control district, or local
356	law plan under this chapter, in order for municipalities and
357	special fire control districts with their own pension plans for
358	firefighters, or for firefighters and police officers, where
359	included, to participate in the distribution of the tax fund
360	established pursuant to s. 175.101, local law plans must meet
361	the minimum benefits and minimum standards set forth in this
362	chapter.
363	(1) PREMIUM TAX INCOME.--If a municipality has a pension
364	plan for firefighters, or a pension plan for firefighters and
365	police officers, where included, which in the opinion of the
366	division meets the minimum benefits and minimum standards set
367	forth in this chapter, the board of trustees of the pension
368	plan, as approved by a majority of firefighters of the
369	municipality, may:
370	(a) Place the income from the premium tax in s. 175.101 in
371	such pension plan for the sole and exclusive use of its
372	firefighters, or for firefighters and police officers, where
373	included, where it shall become an integral part of that pension
374	plan and shall be used to pay extra benefits to the firefighters
375	included in that pension plan; or
376	(b) Place the income from the premium tax in s. 175.101 in
377	a separate supplemental plan to pay extra benefits to
378	firefighters, or to firefighters and police officers where
379	included, participating in such separate supplemental plan.
380
381	The premium tax provided by this chapter shall in all cases be
382	used in its entirety to provide extra benefits to firefighters,
383	or to firefighters and police officers, where included. However,
384	local law plans in effect on October 1, 1998, shall be required
385	to comply with the minimum benefit provisions of this chapter
386	only to the extent that additional premium tax revenues become
387	available to incrementally fund the cost of such compliance as
388	provided in s. 175.162(2)(a). When a plan is in compliance with
389	such minimum benefit provisions, as subsequent additional
390	premium tax revenues become available, they shall be used to
391	provide extra benefits. For the purpose of this chapter,
392	"additional premium tax revenues" means revenues received by a
393	municipality or special fire control district pursuant to s.
394	175.121 which thatexceed that amount received for calendar year
395	1997,and the term "extra benefits" means benefits in addition
396	to or greater than those provided to general employees of the
397	municipality and in addition to those in existence for
398	firefighters on March 12, 1999. Local law plans created by
399	special act before May 23, 1939, shall be deemed to comply with
400	this chapter.
401	Section 4. Subsection (1) of section 185.35, Florida
402	Statutes, is amended to read:
403	185.35 Municipalities having their own pension plans for
404	police officers.--For any municipality, chapter plan, local law
405	municipality, or local law plan under this chapter, in order for
406	municipalities with their own pension plans for police officers,
407	or for police officers and firefighters where included, to
408	participate in the distribution of the tax fund established
409	pursuant to s. 185.08, local law plans must meet the minimum
410	benefits and minimum standards set forth in this chapter:
411	(1) PREMIUM TAX INCOME.--If a municipality has a pension
412	plan for police officers, or for police officers and
413	firefighters where included, which, in the opinion of the
414	division, meets the minimum benefits and minimum standards set
415	forth in this chapter, the board of trustees of the pension
416	plan, as approved by a majority of police officers of the
417	municipality, may:
418	(a) Place the income from the premium tax in s. 185.08 in
419	such pension plan for the sole and exclusive use of its police
420	officers, or its police officers and firefighters where
421	included, where it shall become an integral part of that pension
422	plan and shall be used to pay extra benefits to the police
423	officers included in that pension plan; or
424	(b) May place the income from the premium tax in s. 185.08
425	in a separate supplemental plan to pay extra benefits to the
426	police officers, or police officers and firefighters where
427	included, participating in such separate supplemental plan.
428
429	The premium tax provided by this chapter shall in all cases be
430	used in its entirety to provide extra benefits to police
431	officers, or to police officers and firefighters, where
432	included. However, local law plans in effect on October 1, 1998,
433	shall be required to comply with the minimum benefit provisions
434	of this chapter only to the extent that additional premium tax
435	revenues become available to incrementally fund the cost of such
436	compliance as provided in s. 185.16(2). When a plan is in
437	compliance with such minimum benefit provisions, as subsequent
438	additional tax revenues become available, they shall be used to
439	provide extra benefits. For the purpose of this chapter,
440	"additional premium tax revenues" means revenues received by a
441	municipality pursuant to s. 185.10 which thatexceed the amount
442	received for calendar year 1997,and the term "extra benefits"
443	means benefits in addition to or greater than those provided to
444	general employees of the municipality and in addition to those
445	in existence for police officers on March 12, 1999. Local law
446	plans created by special act before May 23, 1939, shall be
447	deemed to comply with this chapter.
448	Section 5. Subsection (7) is added to section 175.061,
449	Florida Statutes, to read:
450	175.061 Board of trustees; members; terms of office;
451	meetings; legal entity; costs; attorney's fees.--For any
452	municipality, special fire control district, chapter plan, local
453	law municipality, local law special fire control district, or
454	local law plan under this chapter:
455	(7) The board of trustees may, upon written request by the
456	retiree of the plan, or by a dependent, when authorized by the
457	retiree or the retiree's beneficiary, authorize the plan
458	administrator to withhold from the monthly retirement payment
459	those funds that are necessary to pay for the benefits being
460	received through the governmental entity from which the employee
461	retired, to pay the certified bargaining agent of the
462	governmental entity, and to make any payments required by law.
463	Section 6. Subsection (6) of section 185.05, Florida
464	Statutes, is renumbered as subsection (7), and a new subsection
465	(6) is added to said section, to read:
466	185.05 Board of trustees; members; terms of office;
467	meetings; legal entity; costs; attorney's fees.--For any
468	municipality, chapter plan, local law municipality, or local law
469	plan under this chapter:
470	(6) The board of trustees may, upon written request by the
471	retiree of the plan, or by a dependent, when authorized by the
472	retiree or the retiree's beneficiary, authorize the plan
473	administrator to withhold from the monthly retirement payment
474	those funds that are necessary to pay for the benefits being
475	received through the governmental entity from which the employee
476	retired, to pay the certified bargaining agent of the
477	governmental entity, and to make any payments required by law.
478	Section 7. The sum of $300,000 is appropriated from the
479	General Revenue Fund to the Department of Revenue for the one-
480	time expense of creating the original database called for by ss.
481	175.1015 and 185.085, Florida Statutes, as created by this act,
482	and to support the implementation process for use of the
483	database. It is the intent of the Legislature in providing this
484	appropriation that the database for ss. 175.1015 and 185.085,
485	Florida Statutes, as created by this act, be available for use
486	in determining the allocation of premiums to the various
487	municipalities and special fire control districts for the 2005
488	insurance premium tax return that is due by March 1, 2006.
489	Section 8. This act shall take effect January 1, 2005.