Senate Bill sb1132c1

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    Florida Senate - 2006                           CS for SB 1132

    By the Committee on Commerce and Consumer Services; and
    Senator King




    577-1708-06

  1                      A bill to be entitled

  2         An act relating to enterprise zones; amending

  3         s. 195.099, F.S.; revising the expiration date

  4         of provisions governing the assessment of new,

  5         rebuilt, or expanded businesses to coincide

  6         with the expiration of the Florida Enterprise

  7         Zone Act; amending s. 212.08, F.S.; limiting

  8         the tax exemption provided for the

  9         rehabilitation of real property to one parcel

10         of real property unless there is a change in

11         ownership, a new lessor, or a new lessee;

12         providing for retroactive application; amending

13         ss. 212.096 and 220.03, F.S.; redefining the

14         term "new job has been created" for purposes of

15         the enterprise zone jobs credit against the

16         sales tax and the income tax code; amending s.

17         220.13, F.S.; revising the expiration date of a

18         provision requiring that certain wages,

19         salaries, and ad valorem school taxes be added

20         to adjusted federal income; amending s.

21         220.181, F.S.; revising the requirement for

22         demonstrating an increase in the number of jobs

23         for purposes of qualifying for the enterprise

24         zone jobs credit; amending s. 290.0055;

25         requiring that business and property owners be

26         notified of a proposed change to an enterprise

27         zone boundary; providing an effective date.

28  

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

30  

31  

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    Florida Senate - 2006                           CS for SB 1132
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 1         Section 1.  Subsection (1) of section 195.099, Florida

 2  Statutes, is amended to read:

 3         195.099  Periodic review.--

 4         (1)(a)  The department shall periodically review the

 5  assessments of new, rebuilt, and expanded business reported

 6  according to s. 193.077(3), to ensure parity of level of

 7  assessment with other classifications of property.

 8         (b)  The provisions of this subsection shall expire and

 9  be void on the date specified in s. 290.016 for the expiration

10  of the Florida Enterprise Zone Act June 30, 2005.

11         Section 2.  Paragraph (g) of subsection (5) of section

12  212.08, Florida Statutes, is amended to read:

13         212.08  Sales, rental, use, consumption, distribution,

14  and storage tax; specified exemptions.--The sale at retail,

15  the rental, the use, the consumption, the distribution, and

16  the storage to be used or consumed in this state of the

17  following are hereby specifically exempt from the tax imposed

18  by this chapter.

19         (5)  EXEMPTIONS; ACCOUNT OF USE.--

20         (g)  Building materials used in the rehabilitation of

21  real property located in an enterprise zone.--

22         1.  Building materials used in the rehabilitation of

23  real property located in an enterprise zone shall be exempt

24  from the tax imposed by this chapter upon an affirmative

25  showing to the satisfaction of the department that the items

26  have been used for the rehabilitation of real property located

27  in an enterprise zone. Except as provided in subparagraph 2.,

28  this exemption inures to the owner, lessee, or lessor of the

29  rehabilitated real property located in an enterprise zone only

30  through a refund of previously paid taxes. To receive a refund

31  pursuant to this paragraph, the owner, lessee, or lessor of

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    Florida Senate - 2006                           CS for SB 1132
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 1  the rehabilitated real property located in an enterprise zone

 2  must file an application under oath with the governing body or

 3  enterprise zone development agency having jurisdiction over

 4  the enterprise zone where the business is located, as

 5  applicable, which includes:

 6         a.  The name and address of the person claiming the

 7  refund.

 8         b.  An address and assessment roll parcel number of the

 9  rehabilitated real property in an enterprise zone for which a

10  refund of previously paid taxes is being sought.

11         c.  A description of the improvements made to

12  accomplish the rehabilitation of the real property.

13         d.  A copy of the building permit issued for the

14  rehabilitation of the real property.

15         e.  A sworn statement, under the penalty of perjury,

16  from the general contractor licensed in this state with whom

17  the applicant contracted to make the improvements necessary to

18  accomplish the rehabilitation of the real property, which

19  statement lists the building materials used in the

20  rehabilitation of the real property, the actual cost of the

21  building materials, and the amount of sales tax paid in this

22  state on the building materials. In the event that a general

23  contractor has not been used, the applicant shall provide this

24  information in a sworn statement, under the penalty of

25  perjury. Copies of the invoices which evidence the purchase of

26  the building materials used in such rehabilitation and the

27  payment of sales tax on the building materials shall be

28  attached to the sworn statement provided by the general

29  contractor or by the applicant. Unless the actual cost of

30  building materials used in the rehabilitation of real property

31  and the payment of sales taxes due thereon is documented by a

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    Florida Senate - 2006                           CS for SB 1132
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 1  general contractor or by the applicant in this manner, the

 2  cost of such building materials shall be an amount equal to 40

 3  percent of the increase in assessed value for ad valorem tax

 4  purposes.

 5         f.  The identifying number assigned pursuant to s.

 6  290.0065 to the enterprise zone in which the rehabilitated

 7  real property is located.

 8         g.  A certification by the local building code

 9  inspector that the improvements necessary to accomplish the

10  rehabilitation of the real property are substantially

11  completed.

12         h.  Whether the business is a small business as defined

13  by s. 288.703(1).

14         i.  If applicable, the name and address of each

15  permanent employee of the business, including, for each

16  employee who is a resident of an enterprise zone, the

17  identifying number assigned pursuant to s. 290.0065 to the

18  enterprise zone in which the employee resides.

19         2.  This exemption inures to a city, county, other

20  governmental agency, or nonprofit community-based organization

21  through a refund of previously paid taxes if the building

22  materials used in the rehabilitation of real property located

23  in an enterprise zone are paid for from the funds of a

24  community development block grant, State Housing Initiatives

25  Partnership Program, or similar grant or loan program. To

26  receive a refund pursuant to this paragraph, a city, county,

27  other governmental agency, or nonprofit community-based

28  organization must file an application which includes the same

29  information required to be provided in subparagraph 1. by an

30  owner, lessee, or lessor of rehabilitated real property. In

31  addition, the application must include a sworn statement

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    Florida Senate - 2006                           CS for SB 1132
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 1  signed by the chief executive officer of the city, county,

 2  other governmental agency, or nonprofit community-based

 3  organization seeking a refund which states that the building

 4  materials for which a refund is sought were paid for from the

 5  funds of a community development block grant, State Housing

 6  Initiatives Partnership Program, or similar grant or loan

 7  program.

 8         3.  Within 10 working days after receipt of an

 9  application, the governing body or enterprise zone development

10  agency shall review the application to determine if it

11  contains all the information required pursuant to subparagraph

12  1. or subparagraph 2. and meets the criteria set out in this

13  paragraph. The governing body or agency shall certify all

14  applications that contain the information required pursuant to

15  subparagraph 1. or subparagraph 2. and meet the criteria set

16  out in this paragraph as eligible to receive a refund. If

17  applicable, the governing body or agency shall also certify if

18  20 percent of the employees of the business are residents of

19  an enterprise zone, excluding temporary and part-time

20  employees. The certification shall be in writing, and a copy

21  of the certification shall be transmitted to the executive

22  director of the Department of Revenue. The applicant shall be

23  responsible for forwarding a certified application to the

24  department within the time specified in subparagraph 4.

25         4.  An application for a refund pursuant to this

26  paragraph must be submitted to the department within 6 months

27  after the rehabilitation of the property is deemed to be

28  substantially completed by the local building code inspector

29  or by September 1 after the rehabilitated property is first

30  subject to assessment.

31  

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    Florida Senate - 2006                           CS for SB 1132
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 1         5.  The provisions of s. 212.095 do not apply to any

 2  refund application made pursuant to this paragraph. No more

 3  than one exemption through a refund of previously paid taxes

 4  for the rehabilitation of real property shall be permitted for

 5  any one parcel of property unless there is a change in

 6  ownership, a new lessor, or a new lessee of the real property.

 7  No refund shall be granted pursuant to this paragraph unless

 8  the amount to be refunded exceeds $500. No refund granted

 9  pursuant to this paragraph shall exceed the lesser of 97

10  percent of the Florida sales or use tax paid on the cost of

11  the building materials used in the rehabilitation of the real

12  property as determined pursuant to sub-subparagraph 1.e. or

13  $5,000, or, if no less than 20 percent of the employees of the

14  business are residents of an enterprise zone, excluding

15  temporary and part-time employees, the amount of refund

16  granted pursuant to this paragraph shall not exceed the lesser

17  of 97 percent of the sales tax paid on the cost of such

18  building materials or $10,000. A refund approved pursuant to

19  this paragraph shall be made within 30 days of formal approval

20  by the department of the application for the refund. This

21  subparagraph applies retroactively to July 1, 2005.

22         6.  The department shall adopt rules governing the

23  manner and form of refund applications and may establish

24  guidelines as to the requisites for an affirmative showing of

25  qualification for exemption under this paragraph.

26         7.  The department shall deduct an amount equal to 10

27  percent of each refund granted under the provisions of this

28  paragraph from the amount transferred into the Local

29  Government Half-cent Sales Tax Clearing Trust Fund pursuant to

30  s. 212.20 for the county area in which the rehabilitated real

31  

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    Florida Senate - 2006                           CS for SB 1132
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 1  property is located and shall transfer that amount to the

 2  General Revenue Fund.

 3         8.  For the purposes of the exemption provided in this

 4  paragraph:

 5         a.  "Building materials" means tangible personal

 6  property which becomes a component part of improvements to

 7  real property.

 8         b.  "Real property" has the same meaning as provided in

 9  s. 192.001(12).

10         c.  "Rehabilitation of real property" means the

11  reconstruction, renovation, restoration, rehabilitation,

12  construction, or expansion of improvements to real property.

13         d.  "Substantially completed" has the same meaning as

14  provided in s. 192.042(1).

15         9.  This paragraph expires on the date specified in s.

16  290.016 for the expiration of the Florida Enterprise Zone Act.

17         Section 3.  Paragraph (e) of subsection (1) and

18  paragraph (e) of subsection (3) of section 212.096, Florida

19  Statutes, are amended to read:

20         212.096  Sales, rental, storage, use tax; enterprise

21  zone jobs credit against sales tax.--

22         (1)  For the purposes of the credit provided in this

23  section:

24         (e)  "New job has been created" means that, on the date

25  of application, the total number of full-time jobs is greater

26  than it was 12 months prior to such date has increased in an

27  enterprise zone from the average of the previous 12 months, as

28  demonstrated to the department by a business located in the

29  enterprise zone.

30  

31  

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    Florida Senate - 2006                           CS for SB 1132
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 1  A person shall be deemed to be employed if the person performs

 2  duties in connection with the operations of the business on a

 3  regular, full-time basis, provided the person is performing

 4  such duties for an average of at least 36 hours per week each

 5  month. The person must be performing such duties at a business

 6  site located in the enterprise zone.

 7         (3)  In order to claim this credit, an eligible

 8  business must file under oath with the governing body or

 9  enterprise zone development agency having jurisdiction over

10  the enterprise zone where the business is located, as

11  applicable, a statement which includes:

12         (e)  Demonstration to the department that, on the date

13  of application, the total number of full-time jobs defined

14  under paragraph (1)(d) is greater than it was 12 months prior

15  to such date has increased in an enterprise zone from the

16  average of the previous 12 months.

17         Section 4.  Paragraph (ff) of subsection (1) of section

18  220.03, Florida Statutes, is amended to read:

19         220.03  Definitions.--

20         (1)  SPECIFIC TERMS.--When used in this code, and when

21  not otherwise distinctly expressed or manifestly incompatible

22  with the intent thereof, the following terms shall have the

23  following meanings:

24         (ff)  "New job has been created" means that, on the

25  date of application, the total number of full-time jobs is

26  greater than it was 12 months prior to such date has increased

27  in an enterprise zone from the average of the previous 12

28  months, as demonstrated to the department by a business

29  located in the enterprise zone.

30         Section 5.  Paragraph (a) of subsection (1) of section

31  220.13, Florida Statutes, is amended to read:

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    Florida Senate - 2006                           CS for SB 1132
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 1         220.13  "Adjusted federal income" defined.--

 2         (1)  The term "adjusted federal income" means an amount

 3  equal to the taxpayer's taxable income as defined in

 4  subsection (2), or such taxable income of more than one

 5  taxpayer as provided in s. 220.131, for the taxable year,

 6  adjusted as follows:

 7         (a)  Additions.--There shall be added to such taxable

 8  income:

 9         1.  The amount of any tax upon or measured by income,

10  excluding taxes based on gross receipts or revenues, paid or

11  accrued as a liability to the District of Columbia or any

12  state of the United States which is deductible from gross

13  income in the computation of taxable income for the taxable

14  year.

15         2.  The amount of interest which is excluded from

16  taxable income under s. 103(a) of the Internal Revenue Code or

17  any other federal law, less the associated expenses disallowed

18  in the computation of taxable income under s. 265 of the

19  Internal Revenue Code or any other law, excluding 60 percent

20  of any amounts included in alternative minimum taxable income,

21  as defined in s. 55(b)(2) of the Internal Revenue Code, if the

22  taxpayer pays tax under s. 220.11(3).

23         3.  In the case of a regulated investment company or

24  real estate investment trust, an amount equal to the excess of

25  the net long-term capital gain for the taxable year over the

26  amount of the capital gain dividends attributable to the

27  taxable year.

28         4.  That portion of the wages or salaries paid or

29  incurred for the taxable year which is equal to the amount of

30  the credit allowable for the taxable year under s. 220.181.

31  The provisions of this subparagraph shall expire and be void

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    Florida Senate - 2006                           CS for SB 1132
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 1  on the date specified in s. 290.016 for the expiration of the

 2  Florida Enterprise Zone Act June 30, 2005.

 3         5.  That portion of the ad valorem school taxes paid or

 4  incurred for the taxable year which is equal to the amount of

 5  the credit allowable for the taxable year under s. 220.182.

 6  The provisions of this subparagraph shall expire and be void

 7  on the date specified in s. 290.016 for the expiration of the

 8  Florida Enterprise Zone Act June 30, 2005.

 9         6.  The amount of emergency excise tax paid or accrued

10  as a liability to this state under chapter 221 which tax is

11  deductible from gross income in the computation of taxable

12  income for the taxable year.

13         7.  That portion of assessments to fund a guaranty

14  association incurred for the taxable year which is equal to

15  the amount of the credit allowable for the taxable year.

16         8.  In the case of a nonprofit corporation which holds

17  a pari-mutuel permit and which is exempt from federal income

18  tax as a farmers' cooperative, an amount equal to the excess

19  of the gross income attributable to the pari-mutuel operations

20  over the attributable expenses for the taxable year.

21         9.  The amount taken as a credit for the taxable year

22  under s. 220.1895.

23         10.  Up to nine percent of the eligible basis of any

24  designated project which is equal to the credit allowable for

25  the taxable year under s. 220.185.

26         11.  The amount taken as a credit for the taxable year

27  under s. 220.187.

28         Section 6.  Paragraph (a) of subsection (1) and

29  paragraph (f) of subsection (2) of section 220.181, Florida

30  Statutes, are amended to read:

31         220.181  Enterprise zone jobs credit.--

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    Florida Senate - 2006                           CS for SB 1132
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 1         (1)(a)  There shall be allowed a credit against the tax

 2  imposed by this chapter to any business located in an

 3  enterprise zone which demonstrates to the department that, on

 4  the date of application, the total number of full-time jobs is

 5  greater than it was 12 months prior to such date has increased

 6  from the average of the previous 12 months. The credit shall

 7  be computed as 20 percent of the actual monthly wages paid in

 8  this state to each new employee hired when a new job has been

 9  created, as defined under s. 220.03(1)(ff), unless the

10  business is located in a rural enterprise zone, pursuant to s.

11  290.004(6), in which case the credit shall be 30 percent of

12  the actual monthly wages paid. If no less than 20 percent of

13  the employees of the business are residents of an enterprise

14  zone, excluding temporary and part-time employees, the credit

15  shall be computed as 30 percent of the actual monthly wages

16  paid in this state to each new employee hired when a new job

17  has been created, unless the business is located in a rural

18  enterprise zone, in which case the credit shall be 45 percent

19  of the actual monthly wages paid, for a period of up to 24

20  consecutive months. If the new employee hired when a new job

21  is created is a participant in the welfare transition program,

22  the following credit shall be a percent of the actual monthly

23  wages paid: 40 percent for $4 above the hourly federal minimum

24  wage rate; 41 percent for $5 above the hourly federal minimum

25  wage rate; 42 percent for $6 above the hourly federal minimum

26  wage rate; 43 percent for $7 above the hourly federal minimum

27  wage rate; and 44 percent for $8 above the hourly federal

28  minimum wage rate.

29         (2)  When filing for an enterprise zone jobs credit, a

30  business must file under oath with the governing body or

31  enterprise zone development agency having jurisdiction over

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    Florida Senate - 2006                           CS for SB 1132
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 1  the enterprise zone where the business is located, as

 2  applicable, a statement which includes:

 3         (f)  Demonstration to the department that, on the date

 4  of application, the total number of full-time jobs is greater

 5  than it was 12 months prior to that date has increased from

 6  the average of the previous 12 months.

 7         Section 7.  Subsection (6) of section 290.0055, Florida

 8  Statutes, is amended to read:

 9         290.0055  Local nominating procedure.--

10         (6)(a)  The office may approve a change in the boundary

11  of any enterprise zone that which was designated pursuant to

12  s. 290.0065. A boundary change must continue to satisfy the

13  requirements of subsections (3), (4), and (5).

14         (b)  Upon a recommendation by the enterprise zone

15  development agency, the governing body of the jurisdiction

16  which authorized the application for an enterprise zone may

17  apply to the office for a change in boundary once every 3

18  years by adopting a resolution that:

19         1.  States with particularity the reasons for the

20  change; and

21         2.  Describes specifically and, to the extent required

22  by the office, the boundary change to be made.

23         (c)  At least 90 days before adopting a resolution

24  seeking a change in the boundary of an enterprise zone, the

25  governing body must notify in writing all property owners and

26  businesses that may be excluded from the enterprise zone by

27  virtue of the proposed boundary change.

28         Section 8.  This act shall take effect upon becoming a

29  law.

30  

31  

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    Florida Senate - 2006                           CS for SB 1132
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 1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
 2                         Senate Bill 1132

 3                                 

 4  The committee substitute differs from the bill in the
    following ways:
 5  
    -    Amends an additional date to be consistent with the
 6       expiration date of the Enterprise Zone Act.

 7  -    Amends the definition of "new job has been created" in
         two additional paragraphs to be consistent with the
 8       change in the bill.

 9  -    Requires the governing body of an enterprise zone to
         notify all businesses and property owners of a proposed
10       boundary change 90 days before the boundary change takes
         place.
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