| 1 | The Fiscal Council recommends the following: |
| 2 |
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| 3 | Council/Committee Substitute |
| 4 | Remove the entire bill and insert: |
| 5 | A bill to be entitled |
| 6 | An act relating to innovation incentives; creating s. |
| 7 | 288.1089, F.S.; creating within the Office of Tourism, |
| 8 | Trade, and Economic Development the Innovation Incentive |
| 9 | Program for certain purposes; providing definitions; |
| 10 | providing for innovation incentive awards; providing |
| 11 | limitations; providing qualification requirements for |
| 12 | review of applicants and projects by the office and |
| 13 | Enterprise Florida, Inc.; providing proposal evaluation |
| 14 | and recommendation requirements for Enterprise Florida, |
| 15 | Inc.; authorizing the office to negotiate award amounts to |
| 16 | applicants; providing negotiation requirements; requiring |
| 17 | the director of the office to make recommendations to the |
| 18 | Governor for approval or disapproval of certain projects; |
| 19 | providing recommendation requirements; requiring |
| 20 | consultation with the Legislature; providing for |
| 21 | certification of applicants as qualified innovation |
| 22 | businesses; providing for incentive payment agreements; |
| 23 | requiring Enterprise Florida, Inc., to assist the office |
| 24 | in validating certain business performances; requiring a |
| 25 | report; amending s. 403.973, F.S.; requiring the office to |
| 26 | review certain sites for projects funded under the |
| 27 | Innovation Incentive Program; amending s. 288.0655, F.S.; |
| 28 | correcting a cross-reference; providing an appropriation; |
| 29 | providing for carrying forward certain unexpended balances |
| 30 | of appropriations until a time certain; providing for |
| 31 | office retention of obligated funds to be used for certain |
| 32 | purposes; providing for reversion of unobligated funds; |
| 33 | providing an effective date. |
| 34 |
|
| 35 | Be It Enacted by the Legislature of the State of Florida: |
| 36 |
|
| 37 | Section 1. Section 288.1089, Florida Statutes, is created |
| 38 | to read: |
| 39 | 288.1089 Innovation Incentive Program.-- |
| 40 | (1) The Innovation Incentive Program is created within the |
| 41 | Office of Tourism, Trade, and Economic Development to ensure |
| 42 | that sufficient resources are available to allow the state to |
| 43 | respond expeditiously to extraordinary economic opportunities |
| 44 | and to compete effectively for high value research and |
| 45 | development and innovation business projects. |
| 46 | (2) As used in this section, the term: |
| 47 | (a) "Average wage" means the statewide average wage in the |
| 48 | private sector or the average of all private sector wages in the |
| 49 | county or in the standard metropolitan area in which the project |
| 50 | is located as determined by the Agency for Workforce Innovation. |
| 51 | (b) "Cumulative investment" means the total private |
| 52 | investment in buildings and equipment made by an applicant under |
| 53 | a project approved pursuant to this section. |
| 54 | (c) "Director" means the director of the Office of |
| 55 | Tourism, Trade, and Economic Development. |
| 56 | (d) "Innovation business" means a business expanding or |
| 57 | locating in this state that is likely to serve as a catalyst for |
| 58 | the growth of an existing or emerging technology cluster or will |
| 59 | significantly impact the regional economy in which it is to |
| 60 | expand or locate. |
| 61 | (e) "Fiscal year" means the state fiscal year. |
| 62 | (f) "Jobs" means full-time equivalent positions, as that |
| 63 | term is consistent with terms used by the Agency for Workforce |
| 64 | Innovation and the United States Department of Labor for |
| 65 | purposes of unemployment compensation tax administration and |
| 66 | employment estimation, resulting directly from a project in this |
| 67 | state. The term does not include temporary construction jobs. |
| 68 | (g) "Match" means funding from local sources, public or |
| 69 | private, which will be paid to the applicant and which is equal |
| 70 | to 100 percent of an award. Eligible match funding may include |
| 71 | any tax abatement granted to the applicant under s. 196.1995 or |
| 72 | the appraised market value of land, buildings, infrastructure, |
| 73 | or equipment conveyed or provided at a discount to the |
| 74 | applicant. Complete documentation of a match payment or other |
| 75 | conveyance must be presented to and verified by the office prior |
| 76 | to transfer of state funds to an applicant. An applicant may not |
| 77 | provide, directly or indirectly, more than 5 percent of match |
| 78 | funding in any fiscal year. The sources of such funding may not |
| 79 | include, directly or indirectly, state funds appropriated from |
| 80 | the General Revenue Fund or any state trust fund, excluding tax |
| 81 | revenues shared with local governments pursuant to law. |
| 82 | (h) "Office" means the Office of Tourism, Trade, and |
| 83 | Economic Development. |
| 84 | (i) "Project" means the location to or expansion in this |
| 85 | state by an innovation business or research and development |
| 86 | applicant approved for an award pursuant to this section. |
| 87 | (j) "Research and development" means basic and applied |
| 88 | research in the sciences or engineering, as well as the design, |
| 89 | development, and testing of prototypes or processes of new or |
| 90 | improved products. Research and development does not include |
| 91 | market research, routine consumer product testing, sales |
| 92 | research, research in the social sciences or psychology, |
| 93 | nontechnological activities, or technical services. |
| 94 | (k) "Research and development facility" means a facility |
| 95 | that is predominately engaged in research and development |
| 96 | activities. For purposes of this paragraph, the term |
| 97 | "predominantly" means at least 51 percent of the time. |
| 98 | (3) To be eligible for consideration for an innovation |
| 99 | incentive award, an innovation business or research and |
| 100 | development entity must submit a written application to |
| 101 | Enterprise Florida, Inc., before making a decision to locate new |
| 102 | operations in this state or expand an existing operation in this |
| 103 | state. The application must include, but not be limited to: |
| 104 | (a) The applicant's federal employer identification |
| 105 | number, unemployment account number, and state sales tax |
| 106 | registration number. If such numbers are not available at the |
| 107 | time of application, they must be submitted to the office in |
| 108 | writing prior to the disbursement of any payments under this |
| 109 | section. |
| 110 | (b) The location in this state at which the project is |
| 111 | located or is to be located. |
| 112 | (c) A description of the type of business activity, |
| 113 | product, or research and development undertaken by the |
| 114 | applicant, including six-digit North American Industry |
| 115 | Classification System codes for all activities included in the |
| 116 | project. |
| 117 | (d) The applicant's projected investment in the project. |
| 118 | (e) The total investment, from all sources, in the |
| 119 | project. |
| 120 | (f) The number of net new full-time equivalent jobs in |
| 121 | this state the applicant anticipates having created as of |
| 122 | December 31 of each year in the project and the average annual |
| 123 | wage of such jobs. |
| 124 | (g) The total number of full-time equivalent employees |
| 125 | currently employed by the applicant in this state, if |
| 126 | applicable. |
| 127 | (h) The anticipated commencement date of the project. |
| 128 | (i) A detailed explanation of why the innovation incentive |
| 129 | is needed to induce the applicant to expand or locate in the |
| 130 | state and whether an award would cause the applicant to locate |
| 131 | or expand in this state. |
| 132 | (j) If applicable, an estimate of the proportion of the |
| 133 | revenues resulting from the project that will be generated |
| 134 | outside this state. |
| 135 | (4) To qualify for review by the office, the applicant |
| 136 | must, at a minimum, establish the following to the satisfaction |
| 137 | of Enterprise Florida, Inc., and the office: |
| 138 | (a) The jobs created by the project must pay an estimated |
| 139 | annual average wage equaling at least 130 percent of the average |
| 140 | private sector wage in the area where the project is to be |
| 141 | located or the average private sector wage in the state. The |
| 142 | office may waive this average wage requirement at the request of |
| 143 | Enterprise Florida, Inc., for a project located in a brownfield |
| 144 | area designated under s. 376.80, in a rural city or rural county |
| 145 | as defined in s. 288.106, or in an enterprise zone, when the |
| 146 | merits of the individual project or the specific circumstances |
| 147 | in the community in relationship to the project warrant such |
| 148 | action. A recommendation for waiver by Enterprise Florida, Inc., |
| 149 | must include a specific justification for the waiver and be |
| 150 | transmitted to the office in writing. If the director elects to |
| 151 | waive the wage requirement, the waiver must be stated in writing |
| 152 | and the reasons for granting the waiver must be explained. |
| 153 | (b) A research and development project must: |
| 154 | 1. Serve as a catalyst for an emerging or evolving |
| 155 | technology cluster. |
| 156 | 2. Demonstrate a plan for significant higher education |
| 157 | collaboration. |
| 158 | 3. Provide the state, at a minimum, a break-even return on |
| 159 | investment within a 20-year period. |
| 160 | 4. Be provided with a one to one match from the local |
| 161 | community. The match requirement may be reduced or waived in |
| 162 | rural areas of critical economic concern or reduced in rural |
| 163 | communities, brownfields, and enterprise zones. |
| 164 | (c) An innovation business project in this state, other |
| 165 | than a research and development project, must: |
| 166 | 1.a. Result in the creation of at least 1,000 direct, new |
| 167 | jobs at the business; or |
| 168 | b. Result in the creation of at least 750 direct, new jobs |
| 169 | if the project is located in a rural city or rural county as |
| 170 | defined in s. 288.106 or in an enterprise zone. |
| 171 | 2. Have an activity or product that is within an industry |
| 172 | that is designated as a target industry business under s. |
| 173 | 288.106 or a designated sector under s. 288.108. |
| 174 | 3.a. Have a cumulative investment of at least $500 million |
| 175 | within a 3-year period; or |
| 176 | b. Have a cumulative investment that exceeds $375 million |
| 177 | within a 3-year period if the project is located in a rural |
| 178 | county or rural city as defined in s. 288.106 or in an |
| 179 | enterprise zone. |
| 180 | (5) Enterprise Florida, Inc., shall evaluate proposals for |
| 181 | innovation incentive awards and transmit recommendations for |
| 182 | awards to the office. Such evaluation and recommendation must |
| 183 | include, but need not be limited to: |
| 184 | (a) A description of the project, its required facilities, |
| 185 | and the associated product, service, or research and development |
| 186 | associated with the project. |
| 187 | (b) The number of full-time equivalent jobs that will be |
| 188 | created by the project, the total estimated average annual wages |
| 189 | of such jobs, and the types of business activities and jobs |
| 190 | likely to be stimulated by the investment. |
| 191 | (c) The cumulative investment to be dedicated to the |
| 192 | project within 3 years and the total investment expected in the |
| 193 | project if more than 3 years. |
| 194 | (d) The projected economic and fiscal impacts on the local |
| 195 | and state economies relative to investment. |
| 196 | (e) A statement of any special impacts the project is |
| 197 | expected to stimulate in a particular business sector in the |
| 198 | state or regional economy or in the state's universities and |
| 199 | community colleges. |
| 200 | (f) A statement of any anticipated or proposed |
| 201 | relationships with state universities. |
| 202 | (g) A statement of the role the incentive is expected to |
| 203 | play in the decision of the applicant to locate or expand in |
| 204 | this state. |
| 205 | (h) A recommendation and explanation of the amount of the |
| 206 | award needed to cause the applicant to expand or locate in this |
| 207 | state. |
| 208 | (i) A discussion of the efforts and commitments made by |
| 209 | the local community in which the project is to be located to |
| 210 | induce the applicant's location or expansion, taking into |
| 211 | consideration local resources and abilities. |
| 212 | (j) A recommendation for specific performance criteria the |
| 213 | applicant would be expected to achieve in order to receive |
| 214 | payments from the fund and penalties or sanctions for failure to |
| 215 | meet or maintain performance conditions. |
| 216 | (k) For a research and development facility project: |
| 217 | 1. A description of the extent to which the project has |
| 218 | the potential to serve as catalyst for an emerging or evolving |
| 219 | cluster. |
| 220 | 2. The percentage of match provided for the project. |
| 221 | 3. A description of the extent to which the project has or |
| 222 | could have a long-term collaborative research and development |
| 223 | relationship with one or more universities or community colleges |
| 224 | in this state. |
| 225 | 4. A description of the existing or projected impact of |
| 226 | the project on established clusters or targeted industry |
| 227 | sectors. |
| 228 | 5. A description of the project's contribution to the |
| 229 | diversity and resiliency of the innovation economy of this |
| 230 | state. |
| 231 | 6. A description of the project's impact on special-needs |
| 232 | communities, including, but not limited to, rural areas, |
| 233 | distressed urban areas, and enterprise zones. |
| 234 | (6) In consultation with Enterprise Florida, Inc., the |
| 235 | office may negotiate the proposed amount of an award for any |
| 236 | applicant meeting the requirements of this section. In |
| 237 | negotiating such award, the office shall consider the amount of |
| 238 | the incentive needed to cause the applicant to locate or expand |
| 239 | in this state in conjunction with other relevant applicant |
| 240 | impact and cost information and analysis as described in this |
| 241 | section. Particular emphasis shall be given to the potential for |
| 242 | the project to stimulate additional private investment and high- |
| 243 | quality employment opportunities in the area. |
| 244 | (7) Upon receipt of the evaluation and recommendation from |
| 245 | Enterprise Florida, Inc., the director shall recommend to the |
| 246 | Governor the approval or disapproval of an award. In |
| 247 | recommending approval of an award, the director shall include |
| 248 | proposed performance conditions that the applicant must meet in |
| 249 | order to obtain incentive funds and any other conditions that |
| 250 | must be met before the receipt of any incentive funds. The |
| 251 | Governor shall consult with the President of the Senate and the |
| 252 | Speaker of the House of Representatives before giving approval |
| 253 | for an award. Upon approval of an award, the Executive Office of |
| 254 | the Governor shall release the funds pursuant to the legislative |
| 255 | consultation and review requirements set forth in s. 216.177. |
| 256 | (8) Upon approval by the Governor and release of the funds |
| 257 | as set forth in subsection (7), the director shall issue a |
| 258 | letter certifying the applicant as qualified for an award. The |
| 259 | office and the applicant shall enter into an agreement that sets |
| 260 | forth the conditions for payment of incentives. The agreement |
| 261 | must include the total amount of funds awarded; the performance |
| 262 | conditions that must be met to obtain the award or portions of |
| 263 | the award, including, but not limited to, net new employment in |
| 264 | the state, average wage, and total investment; demonstration of |
| 265 | a baseline of current service and a measure of enhanced |
| 266 | capability; the methodology for validating performance; the |
| 267 | schedule of payments; and sanctions for failure to meet |
| 268 | performance conditions. |
| 269 | (9) Enterprise Florida, Inc., shall assist the office in |
| 270 | validating the performance of an innovation business or research |
| 271 | and development facility that has received an award. At the |
| 272 | conclusion of the innovation incentive award agreement, or its |
| 273 | earlier termination, Enterprise Florida, Inc., shall, within 90 |
| 274 | days, report the results of the innovation incentive award to |
| 275 | the Governor, the President of the Senate, and the Speaker of |
| 276 | the House of Representatives. |
| 277 | Section 2. Subsections (16) through (19) of section |
| 278 | 403.973, Florida Statutes, are renumbered as subsections (17) |
| 279 | through (20), respectively, and a new subsection (16) is added |
| 280 | to that section, to read: |
| 281 | 403.973 Expedited permitting; comprehensive plan |
| 282 | amendments.-- |
| 283 | (16) The office, working with the agencies participating |
| 284 | in the memoranda of agreement, shall review sites proposed for |
| 285 | the location of facilities eligible for the Innovation Incentive |
| 286 | Program under s. 288.1089. Within 20 days after the request for |
| 287 | the review by the office, the agencies shall provide to the |
| 288 | office a statement as to each site's necessary permits under |
| 289 | local, state, and federal law and an identification of |
| 290 | significant permitting issues, which if unresolved, may result |
| 291 | in the denial of an agency permit or approval or any significant |
| 292 | delay caused by the permitting process. |
| 293 | Section 3. Paragraph (e) of subsection (2) of section |
| 294 | 288.0655, Florida Statutes, is amended to read: |
| 295 | 288.0655 Rural Infrastructure Fund.-- |
| 296 | (2) |
| 297 | (e) To enable local governments to access the resources |
| 298 | available pursuant to s. 403.973(19)(18), the office may award |
| 299 | grants for surveys, feasibility studies, and other activities |
| 300 | related to the identification and preclearance review of land |
| 301 | which is suitable for preclearance review. Authorized grants |
| 302 | under this paragraph shall not exceed $75,000 each, except in |
| 303 | the case of a project in a rural area of critical economic |
| 304 | concern, in which case the grant shall not exceed $300,000. Any |
| 305 | funds awarded under this paragraph must be matched at a level of |
| 306 | 50 percent with local funds, except that any funds awarded for a |
| 307 | project in a rural area of critical economic concern must be |
| 308 | matched at a level of 33 percent with local funds. In evaluating |
| 309 | applications under this paragraph, the office shall consider the |
| 310 | extent to which the application seeks to minimize administrative |
| 311 | and consultant expenses. |
| 312 | Section 4. For fiscal year 2006-2007, the sum of |
| 313 | $250,000,000 is appropriated from nonrecurring general revenue |
| 314 | to the Office of Tourism, Trade, and Economic Development. |
| 315 | Notwithstanding s. 216.301, Florida Statutes, and pursuant to s. |
| 316 | 216.351, Florida Statutes, any unexpended balance from this |
| 317 | appropriation shall be carried forward at the end of each fiscal |
| 318 | year until the 2010-2011 fiscal year. At the end of the 2010- |
| 319 | 2011 fiscal year, any obligated funds for qualified projects |
| 320 | that are not yet disbursed shall remain with the office to be |
| 321 | used for the purposes of this act. Any unobligated funds of this |
| 322 | appropriation shall revert to the General Revenue Fund |
| 323 | unallocated at the end of the 2010-2011 fiscal year. |
| 324 | Section 5. This act shall take effect July 1, 2006. |