| 1 | A bill to be entitled |
| 2 | An act relating to corporate income tax credit for public |
| 3 | education partners; creating s. 220.1875, F.S.; providing |
| 4 | a popular name; providing purpose to encourage |
| 5 | contributions by corporations to public schools or public |
| 6 | school programs for which tax credit shall be given; |
| 7 | providing definitions; providing authorization to grant |
| 8 | tax credits and limitations on credits; providing public |
| 9 | school requirements for expenditure and accounting of |
| 10 | funds; requiring eligible contributions to be supplemental |
| 11 | funds; providing for administration and rulemaking; |
| 12 | requiring a cooperative agreement; amending ss. 220.02 and |
| 13 | 220.13, F.S., to conform; providing an effective date. |
| 14 |
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| 15 | Be It Enacted by the Legislature of the State of Florida: |
| 16 |
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| 17 | Section 1. Section 220.1875, Florida Statutes, is created |
| 18 | to read: |
| 19 | 220.1875 Credits for contributions by public education |
| 20 | partners.-- |
| 21 | (1) POPULAR NAME.--This section may be cited as the "Karen |
| 22 | Ardaman Act." |
| 23 | (2) PURPOSE.--The purpose of this section is to: |
| 24 | (a) Encourage private, voluntary contributions to public |
| 25 | schools to enhance educational opportunities for students. |
| 26 | (b) Encourage the formation of partnerships between |
| 27 | corporations and public schools. |
| 28 | (c) Enable public school students to achieve a greater |
| 29 | level of excellence in their education through contributions by |
| 30 | public education partners. |
| 31 | (3) DEFINITIONS.--As used in this section, the term: |
| 32 | (a) "Department" means the Department of Revenue. |
| 33 | (b) "Eligible contribution" means a monetary contribution |
| 34 | from a taxpayer to a public school, subject to the restrictions |
| 35 | provided in this section. The taxpayer making the contribution |
| 36 | may designate a specific public school or a specific program in |
| 37 | a public school as the beneficiary of the contribution. The |
| 38 | taxpayer may not contribute more than $5 million to any single |
| 39 | public school. |
| 40 | (4) AUTHORIZATION TO GRANT TAX CREDITS; LIMITATIONS ON |
| 41 | INDIVIDUAL AND TOTAL CREDITS.-- |
| 42 | (a) There is allowed a credit of 100 percent of an |
| 43 | eligible contribution against any tax due for a taxable year |
| 44 | under this chapter. However, such a credit may not exceed 75 |
| 45 | percent of the tax due under this chapter for the taxable year, |
| 46 | after the application of any other allowable credits by the |
| 47 | taxpayer. The credit granted by this section shall be reduced by |
| 48 | the difference between the amount of federal corporate income |
| 49 | tax taking into account the credit granted by this section and |
| 50 | the amount of federal corporate income tax without application |
| 51 | of the credit granted by this section. |
| 52 | (b) The total amount of tax credits and carryforward of |
| 53 | tax credits which may be granted each state fiscal year under |
| 54 | this section is $88 million. However, at least 5 percent of the |
| 55 | total statewide amount authorized for the tax credit shall be |
| 56 | reserved for taxpayers who meet the definition of a small |
| 57 | business provided in s. 288.703(1) at the time of application. |
| 58 | (c) A taxpayer who files a Florida consolidated return as |
| 59 | a member of an affiliated group pursuant to s. 220.131(1) may be |
| 60 | allowed the credit on a consolidated return basis; however, the |
| 61 | total credit taken by the affiliated group is subject to the |
| 62 | limitation established under paragraph (a). |
| 63 | (5) REQUIREMENTS.-- |
| 64 | (a) A public school that receives an eligible contribution |
| 65 | must spend 100 percent of the eligible contribution for the |
| 66 | purpose specified by the contributor. All interest accrued from |
| 67 | an eligible contribution must be used for the purpose specified |
| 68 | by the contributor. |
| 69 | (b) A public school that receives an eligible contribution |
| 70 | must maintain a separate account for the eligible contribution |
| 71 | and must annually provide to the district school board and the |
| 72 | Department of Education a financial accounting of the use of the |
| 73 | contribution. A public school shall budget wisely and use sound |
| 74 | financial practices in the use of an eligible contribution. |
| 75 | (c) Payment of an eligible contribution shall be made to a |
| 76 | public school through the district school board. |
| 77 | (d) An eligible contribution shall not replace, but shall |
| 78 | be supplemental to, funds provided by the state to public school |
| 79 | districts pursuant to chapter 1011. |
| 80 | (6) ADMINISTRATION; RULES.-- |
| 81 | (a) If the credit granted pursuant to this section is not |
| 82 | fully used in any one year because of insufficient tax liability |
| 83 | on the part of the corporation, the unused amount may be carried |
| 84 | forward for a period not to exceed 3 years; however, any |
| 85 | taxpayer that seeks to carry forward an unused amount of tax |
| 86 | credit must submit an application for allocation of tax credits |
| 87 | or carryforward credits as required in paragraph (b) in the year |
| 88 | that the taxpayer intends to use the carryforward. A taxpayer |
| 89 | may not convey, assign, or transfer the credit authorized by |
| 90 | this section to another entity unless all of the assets of the |
| 91 | taxpayer are conveyed, assigned, or transferred in the same |
| 92 | transaction. |
| 93 | (b) The department shall adopt rules pursuant to ss. |
| 94 | 120.536(1) and 120.54 for the administration of this section, |
| 95 | including rules establishing application forms and procedures |
| 96 | and rules governing the allocation of tax credits and |
| 97 | carryforward credits under this section. |
| 98 | (c) The State Board of Education shall adopt rules |
| 99 | pursuant to ss. 120.536(1) and 120.54 for the distribution and |
| 100 | use of contributions. |
| 101 | (d) The department and the Department of Education shall |
| 102 | develop a cooperative agreement to assist in the administration |
| 103 | of this section. |
| 104 | Section 2. Subsection (8) of section 220.02, Florida |
| 105 | Statutes, is amended to read: |
| 106 | 220.02 Legislative intent.-- |
| 107 | (8) It is the intent of the Legislature that credits |
| 108 | against either the corporate income tax or the franchise tax be |
| 109 | applied in the following order: those enumerated in s. 631.828, |
| 110 | those enumerated in s. 220.191, those enumerated in s. 220.181, |
| 111 | those enumerated in s. 220.183, those enumerated in s. 220.182, |
| 112 | those enumerated in s. 220.1895, those enumerated in s. 221.02, |
| 113 | those enumerated in s. 220.184, those enumerated in s. 220.186, |
| 114 | those enumerated in s. 220.1845, those enumerated in s. 220.19, |
| 115 | those enumerated in s. 220.185, and those enumerated in s. |
| 116 | 220.187, and those enumerated in s. 220.1875. |
| 117 | Section 3. Paragraph (a) of subsection (1) of section |
| 118 | 220.13, Florida Statutes, is amended to read: |
| 119 | 220.13 "Adjusted federal income" defined.-- |
| 120 | (1) The term "adjusted federal income" means an amount |
| 121 | equal to the taxpayer's taxable income as defined in subsection |
| 122 | (2), or such taxable income of more than one taxpayer as |
| 123 | provided in s. 220.131, for the taxable year, adjusted as |
| 124 | follows: |
| 125 | (a) Additions.--There shall be added to such taxable |
| 126 | income: |
| 127 | 1. The amount of any tax upon or measured by income, |
| 128 | excluding taxes based on gross receipts or revenues, paid or |
| 129 | accrued as a liability to the District of Columbia or any state |
| 130 | of the United States which is deductible from gross income in |
| 131 | the computation of taxable income for the taxable year. |
| 132 | 2. The amount of interest which is excluded from taxable |
| 133 | income under s. 103(a) of the Internal Revenue Code or any other |
| 134 | federal law, less the associated expenses disallowed in the |
| 135 | computation of taxable income under s. 265 of the Internal |
| 136 | Revenue Code or any other law, excluding 60 percent of any |
| 137 | amounts included in alternative minimum taxable income, as |
| 138 | defined in s. 55(b)(2) of the Internal Revenue Code, if the |
| 139 | taxpayer pays tax under s. 220.11(3). |
| 140 | 3. In the case of a regulated investment company or real |
| 141 | estate investment trust, an amount equal to the excess of the |
| 142 | net long-term capital gain for the taxable year over the amount |
| 143 | of the capital gain dividends attributable to the taxable year. |
| 144 | 4. That portion of the wages or salaries paid or incurred |
| 145 | for the taxable year which is equal to the amount of the credit |
| 146 | allowable for the taxable year under s. 220.181. The provisions |
| 147 | of this subparagraph shall expire and be void on June 30, 2005. |
| 148 | 5. That portion of the ad valorem school taxes paid or |
| 149 | incurred for the taxable year which is equal to the amount of |
| 150 | the credit allowable for the taxable year under s. 220.182. The |
| 151 | provisions of this subparagraph shall expire and be void on June |
| 152 | 30, 2005. |
| 153 | 6. The amount of emergency excise tax paid or accrued as a |
| 154 | liability to this state under chapter 221 which tax is |
| 155 | deductible from gross income in the computation of taxable |
| 156 | income for the taxable year. |
| 157 | 7. That portion of assessments to fund a guaranty |
| 158 | association incurred for the taxable year which is equal to the |
| 159 | amount of the credit allowable for the taxable year. |
| 160 | 8. In the case of a nonprofit corporation which holds a |
| 161 | pari-mutuel permit and which is exempt from federal income tax |
| 162 | as a farmers' cooperative, an amount equal to the excess of the |
| 163 | gross income attributable to the pari-mutuel operations over the |
| 164 | attributable expenses for the taxable year. |
| 165 | 9. The amount taken as a credit for the taxable year under |
| 166 | s. 220.1895. |
| 167 | 10. Up to nine percent of the eligible basis of any |
| 168 | designated project which is equal to the credit allowable for |
| 169 | the taxable year under s. 220.185. |
| 170 | 11. The amount taken as a credit for the taxable year |
| 171 | under s. 220.187. |
| 172 | 12. The amount taken as a credit for the taxable year |
| 173 | under s. 220.1875. |
| 174 | Section 4. This act shall take effect July 1, 2005. |