HB 505

1
A bill to be entitled
2An act relating to the communications services tax;
3amending s. 202.16, F.S.; requiring dealers to document
4exempt sales for resale; providing requirements; providing
5a definition; providing construction; providing for dealer
6provision of evidence of the exempt status of certain
7sales through an informal protest process; requiring the
8Department of Revenue to accept certain evidence during
9the protest period; providing limitations; providing for
10retroactive application; requiring the department to
11establish a toll-free number for certain registration and
12resale certificate verification purposes; providing
13requirements; requiring the department to establish a
14system for receiving certain information relating to
15certificate numbers of dealers making purchases for
16resale; providing requirements; amending s. 202.19, F.S.;
17clarifying a characterization of the local communications
18services tax as including certain fees and being in lieu
19of such fees; authorizing municipalities or counties to
20use certain revenues distributed to a local government for
21certain purposes; amending s. 202.20, F.S.; limiting local
22government authority to make certain rate adjustments in
23the tax under certain circumstances; deleting obsolete
24provisions relating to making certain adjustments in the
25tax for certain periods; amending s. 202.21, F.S.;
26deleting provisions relating to local government
27adjustments of the tax by emergency ordinance or
28resolution to conform; specifying that certain amendments
29are remedial in nature and clarify certain provisions of
30law but do not grant rights to refund of certain fees or
31charges under certain circumstances; providing for
32nonapplication to certain emergency rates; providing
33effective dates.
34
35Be It Enacted by the Legislature of the State of Florida:
36
37     Section 1.  Effective upon this act becoming a law, and
38operating retroactively to December 31, 2004, subsection (2) of
39section 202.16, Florida Statutes, is amended to read:
40     202.16  Payment.--The taxes imposed or administered under
41this chapter and chapter 203 shall be collected from all dealers
42of taxable communications services on the sale at retail in this
43state of communications services taxable under this chapter and
44chapter 203. The full amount of the taxes on a credit sale,
45installment sale, or sale made on any kind of deferred payment
46plan is due at the moment of the transaction in the same manner
47as a cash sale.
48     (2)(a)  A sale of communications services that are used as
49a component part of or integrated into a communications service
50or prepaid calling arrangement for resale, including, but not
51limited to, carrier-access charges, interconnection charges paid
52by providers of mobile communication services or other
53communication services, charges paid by cable service providers
54for the transmission of video or other programming by another
55dealer of communications services, charges for the sale of
56unbundled network elements, and any other intercompany charges
57for the use of facilities for providing communications services
58for resale, must be made in compliance with the rules of the
59department. Any person who makes a sale for resale which is not
60in compliance with these rules is liable for any tax, penalty,
61and interest due for failing to comply, to be calculated
62pursuant to s. 202.28(2)(a).
63     (b)1.  Any dealer who makes a sale for resale shall
64document the exempt nature of the transaction, as established by
65rules adopted by the department, by retaining a copy of the
66purchaser's initial or annual resale certificate issued pursuant
67to s. 202.17(6). In lieu of maintaining a copy of the
68certificate, a dealer may document, prior to the time of sale,
69an authorization number, provided telephonically or
70electronically by the department, or by such other means
71established by rule of the department. The dealer may rely on an
72initial or annual resale certificate issued pursuant to s.
73202.17(6), valid at the time of receipt from the purchaser,
74without seeking additional annual resale certificates from such
75purchaser, if the dealer makes recurring sales to the purchaser
76in the normal course of business on a continual basis. For
77purposes of this paragraph, the term "recurring sales to a
78purchaser in the normal course of business" means a sale in
79which the dealer extends credit to the purchaser and records the
80debt as an account receivable, or in which the dealer sells to a
81purchaser who has an established cash account, similar to an
82open credit account. For purposes of this paragraph, purchases
83are made from a selling dealer on a continual basis if the
84selling dealer makes, in the normal course of business, sales to
85the purchaser no less frequently than once in every 12-month
86period.
87     2.  A dealer may, through the informal protest process
88provided for in s. 213.21 and the rules of the department,
89provide the department with evidence of the exempt status of a
90sale. Exemption certificates executed by entities that were
91exempt at the time of sale, resale certificates provided by
92purchasers who were active dealers at the time of sale, and
93verification by the department of a purchaser's active dealer
94status at the time of sale in lieu of a resale certificate shall
95be accepted by the department when submitted during the protest
96period but may not be accepted in any proceeding under chapter
97120 or any circuit court action instituted under chapter 72.
98     Section 2.  Effective January 1, 2006, the Department of
99Revenue shall establish:
100     (1)  A toll-free number for the verification of valid
101registration numbers and resale certificates under s.
102202.16(2)(b), Florida Statutes. The system must be adequate to
103guarantee a low busy rate, must respond to keypad inquiries, and
104must provide data that is updated daily.
105     (2)  A system for receiving information from dealers
106regarding certificate numbers under s. 202.16(2)(b), Florida
107Statutes, of dealers who are seeking to make purchases for
108resale. The department shall provide such dealers, free of
109charge, with verification of those numbers that are canceled or
110invalid.
111     Section 3.  Paragraph (a) of subsection (3) and subsection
112(9) of section 202.19, Florida Statutes, are amended to read:
113     202.19  Authorization to impose local communications
114services tax.--
115     (3)(a)  The tax authorized under this section includes and
116is in lieu of any fee or other consideration, including, but not
117limited to, application fees, transfer fees, renewal fees, or
118claims for related costs, to which the municipality or county is
119otherwise entitled for granting permission to dealers of
120communications services, including, but not limited to,
121providers of cable television services, as authorized in 47
122U.S.C. s. 542, to use or occupy its roads or rights-of-way for
123the placement, construction, and maintenance of poles, wires,
124and other fixtures used in the provision of communications
125services.
126     (9)  The revenues raised by any tax imposed under
127subsection (1) or s. 202.20(1), or distributed to a local
128government pursuant to s. 202.18, may be used by a municipality
129or county for any public purpose, including, but not limited to,
130pledging such revenues for the repayment of current or future
131bonded indebtedness. Revenues raised by a tax imposed under
132subsection (5) shall be used for the same purposes as the
133underlying discretionary sales surtax imposed by the county or
134school board under s. 212.055.
135     Section 4.  Paragraph (a) of subsection (2) of section
136202.20, Florida Statutes, is amended to read:
137     202.20  Local communications services tax conversion
138rates.--
139     (2)(a)1.  With respect to any local taxing jurisdiction,
140if, for the periods ending December 31, 2001; March 31, 2002;
141June 30, 2002; or September 30, 2002, the revenues received by
142that local government from the local communications services tax
143imposed under subsection (1) are less than the revenues received
144from the replaced revenue sources for the corresponding 2000-
1452001 period; plus reasonably anticipated growth in such revenues
146over the preceding 1-year period, based on the average growth of
147such revenues over the immediately preceding 5-year period; plus
148an amount representing the revenues from the replaced revenue
149sources for the 1-month period that the local taxing
150jurisdiction was required to forego, the governing authority may
151adjust the rate of the local communications services tax upward
152to the extent necessary to generate the entire shortfall in
153revenues within 1 year after the rate adjustment and by an
154amount necessary to generate the expected amount of revenue on
155an ongoing basis.
156     2.  If complete data are not available at the time of
157determining whether the revenues received by a local government
158from the local communications services tax imposed under
159subsection (1) are less than the revenues received from the
160replaced revenue sources for the corresponding 2000-2001 period,
161as set forth in subparagraph 1., the local government shall use
162the best data available for the corresponding 2000-2001 period
163in making such determination.
164     3.  The adjustment permitted under subparagraph 1. may be
165made by emergency ordinance or resolution and may be made
166notwithstanding the maximum rate established under s. 202.19(2)
167and notwithstanding any schedules or timeframes or any other
168limitations contained in this chapter. The authority of a local
169government to make such adjustment may be exercised only if the
170department or a dealer reallocates revenue away from the local
171government. The emergency ordinance or resolution shall specify
172an effective date for the adjusted rate, which shall be no less
173than 60 days after the date of adoption of the ordinance or
174resolution and shall be effective with respect to taxable
175services included on bills that are dated on the first day of a
176month subsequent to the expiration of the 60-day period. At the
177end of 1 year following the effective date of such adjusted
178rate, the local governing authority shall, as soon as is
179consistent with s. 202.21, reduce the rate by that portion of
180the emergency rate which was necessary to recoup the amount of
181revenues not received prior to the implementation of the
182emergency rate.
183     4.  If, for the period October 1, 2001, through September
18430, 2002, the revenues received by a local government from the
185local communications services tax conversion rate established
186under subsection (1), adjusted upward for the difference in
187rates between paragraphs (1)(a) and (b) or any other rate
188adjustments or base changes, are above the threshold of 10
189percent more than the revenues received from the replaced
190revenue sources for the corresponding 2000-2001 period plus
191reasonably anticipated growth in such revenues over the
192preceding 1-year period, based on the average growth of such
193revenues over the immediately preceding 5-year period, the
194governing authority must adjust the rate of the local
195communications services tax to the extent necessary to reduce
196revenues to the threshold by emergency ordinance or resolution
197within the timeframes established in subparagraph 3. The
198foregoing rate adjustment requirement shall not apply to a local
199government that adopts a local communications services tax rate
200by resolution or ordinance. If complete data are not available
201at the time of determining whether the revenues exceed the
202threshold, the local government shall use the best data
203available for the corresponding 2000-2001 period in making such
204determination. This subparagraph shall not be construed as
205establishing a right of action for any person to enforce this
206subparagraph or challenge a local government's implementation of
207this subparagraph.
208     Section 5.  Effective July 1, 2007, subsection (2) of
209section 202.20, Florida Statutes, as amended by this act, is
210amended to read:
211     202.20  Local communications services tax conversion
212rates.--
213     (2)(a)1.  With respect to any local taxing jurisdiction,
214if, for the periods ending December 31, 2001; March 31, 2002;
215June 30, 2002; or September 30, 2002, the revenues received by
216that local government from the local communications services tax
217imposed under subsection (1) are less than the revenues received
218from the replaced revenue sources for the corresponding 2000-
2192001 period; plus reasonably anticipated growth in such revenues
220over the preceding 1-year period, based on the average growth of
221such revenues over the immediately preceding 5-year period; plus
222an amount representing the revenues from the replaced revenue
223sources for the 1-month period that the local taxing
224jurisdiction was required to forego, the governing authority may
225adjust the rate of the local communications services tax upward
226to the extent necessary to generate the entire shortfall in
227revenues within 1 year after the rate adjustment and by an
228amount necessary to generate the expected amount of revenue on
229an ongoing basis.
230     2.  If complete data are not available at the time of
231determining whether the revenues received by a local government
232from the local communications services tax imposed under
233subsection (1) are less than the revenues received from the
234replaced revenue sources for the corresponding 2000-2001 period,
235as set forth in subparagraph 1., the local government shall use
236the best data available for the corresponding 2000-2001 period
237in making such determination.
238     3.  The adjustment permitted under subparagraph 1. may be
239made by emergency ordinance or resolution and may be made
240notwithstanding the maximum rate established under s. 202.19(2)
241and notwithstanding any schedules or timeframes or any other
242limitations contained in this chapter. The authority of a local
243government to make such adjustment may be exercised only if the
244department or a dealer reallocates revenue away from the local
245government. The emergency ordinance or resolution shall specify
246an effective date for the adjusted rate, which shall be no less
247than 60 days after the date of adoption of the ordinance or
248resolution and shall be effective with respect to taxable
249services included on bills that are dated on the first day of a
250month subsequent to the expiration of the 60-day period. At the
251end of 1 year following the effective date of such adjusted
252rate, the local governing authority shall, as soon as is
253consistent with s. 202.21, reduce the rate by that portion of
254the emergency rate which was necessary to recoup the amount of
255revenues not received prior to the implementation of the
256emergency rate.
257     4.  If, for the period October 1, 2001, through September
25830, 2002, the revenues received by a local government from the
259local communications services tax conversion rate established
260under subsection (1), adjusted upward for the difference in
261rates between paragraphs (1)(a) and (b) or any other rate
262adjustments or base changes, are above the threshold of 10
263percent more than the revenues received from the replaced
264revenue sources for the corresponding 2000-2001 period plus
265reasonably anticipated growth in such revenues over the
266preceding 1-year period, based on the average growth of such
267revenues over the immediately preceding 5-year period, the
268governing authority must adjust the rate of the local
269communications services tax to the extent necessary to reduce
270revenues to the threshold by emergency ordinance or resolution
271within the timeframes established in subparagraph 3. The
272foregoing rate adjustment requirement shall not apply to a local
273government that adopts a local communications services tax rate
274by resolution or ordinance. If complete data are not available
275at the time of determining whether the revenues exceed the
276threshold, the local government shall use the best data
277available for the corresponding 2000-2001 period in making such
278determination. This subparagraph shall not be construed as
279establishing a right of action for any person to enforce this
280subparagraph or challenge a local government's implementation of
281this subparagraph.
282     (b)  The term Except as otherwise provided in this
283subsection, "replaced revenue sources," as used in this section,
284means the following taxes, charges, fees, or other impositions
285to the extent that the respective local taxing jurisdictions
286were authorized to impose them prior to July 1, 2000.
287     (a)1.  With respect to municipalities and charter counties
288and the taxes authorized by s. 202.19(1):
289     1.a.  The public service tax on telecommunications
290authorized by former s. 166.231(9).
291     2.b.  Franchise fees on cable service providers as
292authorized by 47 U.S.C. s. 542.
293     3.c.  The public service tax on prepaid calling
294arrangements.
295     4.d.  Franchise fees on dealers of communications services
296which use the public roads or rights-of-way, up to the limit set
297forth in s. 337.401. For purposes of calculating rates under
298this section, it is the legislative intent that charter counties
299be treated as having had the same authority as municipalities to
300impose franchise fees on recurring local telecommunication
301service revenues prior to July 1, 2000. However, the Legislature
302recognizes that the authority of charter counties to impose such
303fees is in dispute, and the treatment provided in this section
304is not an expression of legislative intent that charter counties
305actually do or do not possess such authority.
306     5.e.  Actual permit fees relating to placing or maintaining
307facilities in or on public roads or rights-of-way, collected
308from providers of long-distance, cable, and mobile
309communications services for the fiscal year ending September 30,
3101999; however, if a municipality or charter county elects the
311option to charge permit fees pursuant to s. 337.401(3)(c)1.a.,
312such fees shall not be included as a replaced revenue source.
313     (b)2.  With respect to all other counties and the taxes
314authorized in s. 202.19(1), franchise fees on cable service
315providers as authorized by 47 U.S.C. s. 542.
316     Section 6.  Effective July 1, 2007, section 202.21, Florida
317Statutes, is amended to read:
318     202.21  Effective dates; procedures for informing dealers
319of communications services of tax levies and rate changes.--Any
320adoption, repeal, or change in the rate of a local
321communications services tax imposed under s. 202.19 is effective
322with respect to taxable services included on bills that are
323dated on or after the January 1 subsequent to such adoption,
324repeal, or change. A municipality or county adopting, repealing,
325or changing the rate of such tax must notify the department of
326the adoption, repeal, or change by September 1 immediately
327preceding such January 1. Notification must be furnished on a
328form prescribed by the department and must specify the rate of
329tax; the effective date of the adoption, repeal, or change
330thereof; and the name, mailing address, and telephone number of
331a person designated by the municipality or county to respond to
332inquiries concerning the tax. The department shall provide
333notice of such adoption, repeal, or change to all affected
334dealers of communications services at least 90 days before the
335effective date of the tax. Any local government that adjusts the
336rate of its local communications services tax by emergency
337ordinance or resolution pursuant to s. 202.20(2) shall notify
338the department of the new tax rate immediately upon its
339adoption. The department shall provide written notice of the
340adoption of the new rate to all affected dealers within 30 days
341after receiving such notice. In any notice to providers or
342publication of local tax rates for purposes of this chapter, the
343department shall express the rate for a municipality or charter
344county as the sum of the tax rates levied within such
345jurisdiction pursuant to s. 202.19(2)(a) and (5), and shall
346express the rate for any other county as the sum of the tax
347rates levied pursuant to s. 202.19(2)(b) and (5). The department
348is not liable for any loss of or decrease in revenue by reason
349of any error, omission, or untimely action that results in the
350nonpayment of a tax imposed under s. 202.19.
351     Section 7.  The amendments to s. 202.19(3)(a), Florida
352Statutes, contained in this act are remedial in nature and
353intended to clarify the law in effect on October 1, 2001, but do
354not grant any right to a refund of any fees or charges paid
355prior to July 1, 2005, unless the payment was made under written
356protest as to the authority of any local government to impose
357such fees or costs on a dealer.
358     Section 8.  The amendments to provisions of law made by
359this act do not apply to emergency rates adopted pursuant to s.
360202.20, Florida Statutes, prior to the effective dates of this
361act.
362     Section 9.  Except as otherwise provided herein, this act
363shall take effect upon becoming a law.


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