HB 305

1	A bill to be entitled
2	An act relating to economic development; amending s.
3	212.097, F.S.; revising provisions providing for an urban
4	job tax credit program to apply to designated urban job
5	tax credit areas rather than high-crime areas; revising
6	and providing definitions, eligibility criteria,
7	application procedures and requirements, and area
8	characteristics and criteria; amending ss. 212.08,
9	220.1895, and 288.99, F.S., to conform; providing an
10	effective date.
11
12	Be It Enacted by the Legislature of the State of Florida:
13
14	Section 1.  Paragraph (o) of subsection (5) of section
15	212.08, Florida Statutes, is amended to read:
16	212.08  Sales, rental, use, consumption, distribution, and
17	storage tax; specified exemptions.--The sale at retail, the
18	rental, the use, the consumption, the distribution, and the
19	storage to be used or consumed in this state of the following
20	are hereby specifically exempt from the tax imposed by this
21	chapter.
22	(5)  EXEMPTIONS; ACCOUNT OF USE.--
23	(o)  Building materials in redevelopment projects.--
24	1.  As used in this paragraph, the term:
25	a.  "Building materials" means tangible personal property
26	that becomes a component part of a housing project or a mixed-
27	use project.
28	b.  "Housing project" means the conversion of an existing
29	manufacturing or industrial building to housing units in a
30	designated an urban job tax credit high-crime area, enterprise
31	zone, empowerment zone, Front Porch Community, designated
32	brownfield area, or urban infill area and in which the developer
33	agrees to set aside at least 20 percent of the housing units in
34	the project for low-income and moderate-income persons or the
35	construction in a designated brownfield area of affordable
36	housing for persons described in s. 420.0004(9), (10), or (14),
37	or in s. 159.603(7).
38	c.  "Mixed-use project" means the conversion of an existing
39	manufacturing or industrial building to mixed-use units that
40	include artists' studios, art and entertainment services, or
41	other compatible uses. A mixed-use project must be located in a
42	designated an urban job tax credit high-crime area, enterprise
43	zone, empowerment zone, Front Porch Community, designated
44	brownfield area, or urban infill area, and the developer must
45	agree to set aside at least 20 percent of the square footage of
46	the project for low-income and moderate-income housing.
47	d.  "Substantially completed" has the same meaning as
48	provided in s. 192.042(1).
49	2.  Building materials used in the construction of a
50	housing project or mixed-use project are exempt from the tax
51	imposed by this chapter upon an affirmative showing to the
52	satisfaction of the department that the requirements of this
53	paragraph have been met. This exemption inures to the owner
54	through a refund of previously paid taxes. To receive this
55	refund, the owner must file an application under oath with the
56	department which includes:
57	a.  The name and address of the owner.
58	b.  The address and assessment roll parcel number of the
59	project for which a refund is sought.
60	c.  A copy of the building permit issued for the project.
61	d.  A certification by the local building code inspector
62	that the project is substantially completed.
63	e.  A sworn statement, under penalty of perjury, from the
64	general contractor licensed in this state with whom the owner
65	contracted to construct the project, which statement lists the
66	building materials used in the construction of the project and
67	the actual cost thereof, and the amount of sales tax paid on
68	these materials. If a general contractor was not used, the owner
69	shall provide this information in a sworn statement, under
70	penalty of perjury. Copies of invoices evidencing payment of
71	sales tax must be attached to the sworn statement.
72	3.  An application for a refund under this paragraph must
73	be submitted to the department within 6 months after the date
74	the project is deemed to be substantially completed by the local
75	building code inspector. Within 30 working days after receipt of
76	the application, the department shall determine if it meets the
77	requirements of this paragraph. A refund approved pursuant to
78	this paragraph shall be made within 30 days after formal
79	approval of the application by the department. The provisions of
80	s. 212.095 do not apply to any refund application made under
81	this paragraph.
82	4.  The department shall establish by rule an application
83	form and criteria for establishing eligibility for exemption
84	under this paragraph.
85	5.  The exemption shall apply to purchases of materials on
86	or after July 1, 2000.
87	Section 2.  Section 212.097, Florida Statutes, is amended
88	to read:
89	212.097  Designated Urban High-Crime Area Job Tax Credit
90	Area Program.--
91	(1)  As used in this section, the term:
92	(a)  "Eligible business" means any sole proprietorship,
93	firm, partnership, or corporation that is located in a
94	designated urban job tax credit area qualified county and is
95	predominantly engaged in, or is headquarters for a business
96	predominantly engaged in, activities usually provided for
97	consideration by firms classified within the following standard
98	industrial classifications: SIC 01-SIC 09 (agriculture,
99	forestry, and fishing); SIC 20-SIC 39 (manufacturing); SIC 52-
100	SIC 57 and SIC 59 (retail); SIC 422 (public warehousing and
101	storage); SIC 70 (hotels and other lodging places); SIC 7391
102	(research and development); SIC 781 (motion picture production
103	and allied services); SIC 7992 (public golf courses); and SIC
104	7996 (amusement parks); and a targeted industry eligible for the
105	qualified target industry business tax refund under s. 288.106.
106	A call center or similar customer service operation that
107	services a multistate market or international market is also an
108	eligible business. In addition, the Office of Tourism, Trade,
109	and Economic Development may, as part of its final budget
110	request submitted pursuant to s. 216.023, recommend additions to
111	or deletions from the list of standard industrial
112	classifications used to determine an eligible business, and the
113	Legislature may implement such recommendations. Excluded from
114	eligible receipts are receipts from retail sales, except such
115	receipts for SIC 52-SIC 57 and SIC 59 (retail) hotels and other
116	lodging places classified in SIC 70, public golf courses in SIC
117	7992, and amusement parks in SIC 7996. For purposes of this
118	paragraph, the term "predominantly" means that more than 50
119	percent of the business's gross receipts from all sources is
120	generated by those activities usually provided for consideration
121	by firms in the specified standard industrial classification.
122	The determination of whether the business is located in a
123	designated urban job tax credit qualified high-crime area and
124	the tier ranking of that area must be based on the date of
125	application for the credit under this section. Commonly owned
126	and controlled entities are to be considered a single business
127	entity.
128	(b)  "Qualified employee" means any employee of an eligible
129	business who performs duties in connection with the operations
130	of the business on a regular, full-time basis for an average of
131	at least 36 hours per week for at least 3 months within the
132	designated urban job tax credit qualified high-crime area in
133	which the eligible business is located. An owner or partner of
134	the eligible business is not a qualified employee. The term also
135	includes an employee leased from an employee leasing company
136	licensed under chapter 468, if such employee has been
137	continuously leased to the employer for an average of at least
138	36 hours per week for more than 6 months.
139	(c)  "New business" means any eligible business first
140	beginning operation on a site in a designated urban job tax
141	credit qualified high-crime area and clearly separate from any
142	other commercial or business operation of the business entity
143	within a designated urban job tax credit qualified high-crime
144	area. A business entity that operated an eligible business
145	within a designated urban job tax credit qualified high-crime
146	area within the 48 months before the period provided for
147	application by subsection (2) is not considered a new business.
148	(d)  "Existing business" means any eligible business that
149	does not meet the criteria for a new business.
150	(e)  "Designated urban job tax credit Qualified high-crime
151	area" means an area selected by the Office of Tourism, Trade,
152	and Economic Development in the following manner: every fifth
153	third year, the office shall designate rank and tier those areas
154	nominated under subsection (7), according to the highest level
155	of distress experienced in the categories enumerated under
156	subsection (7). The Office of Tourism, Trade, and Economic
157	Development shall designate the 30 highest-distress-profile
158	urban areas as eligible participants under the Designated Urban
159	Job Tax Credit Area Program. following prioritized criteria:
160	1.  Highest arrest rates within the geographic area for
161	violent crime and for such other crimes as drug sale, drug
162	possession, prostitution, vandalism, and civil disturbances;
163	2.  Highest reported crime volume and rate of specific
164	property crimes such as business and residential burglary, motor
165	vehicle theft, and vandalism;
166	3.  Highest percentage of reported index crimes that are
167	violent in nature;
168	4.  Highest overall index crime volume for the area; and
169	5.  Highest overall index crime rate for the geographic
170	area.
171
172	Tier-one areas are ranked 1 through 5 and represent the highest
173	crime areas according to this ranking. Tier-two areas are ranked
174	6 through 10 according to this ranking. Tier-three areas are
175	ranked 11 through 15. Notwithstanding this definition,
176	"designated urban job tax credit qualified high-crime area" also
177	means an area that has been designated as a federal Empowerment
178	Zone pursuant to the Taxpayer Relief Act of 1997 or the
179	Community Tax Relief Act of 2000. An area designated under this
180	section as of December 31, 2006, shall retain such designation
181	through December 31, 2013, and a business that is eligible for
182	the tax credit as of June 30, 2006, within a designated area
183	shall retain the same tax credit amounts through December 31,
184	2013, that were available to the business on June 30, 2006, if
185	the business complies with the job creation requirements. Any
186	area designated pursuant to this section shall retain the
187	designation for a period not to exceed 7 years after the
188	effective date of designation. Thereafter, any such area or any
189	other area eligible for designation may seek approval from the
190	office for designation Such a designated area is ranked in tier
191	three until the areas are reevaluated by the Office of Tourism,
192	Trade, and Economic Development.
193	(f)  "Urban" means a densely populated nonrural area
194	located within an urban county that consists of a cluster of one
195	or more census blocks, each of which has a population density of
196	at least 400 people per square mile, or an area defined as an
197	urbanized area by the most recent United States Census.
198	(g)  "Urban infill and redevelopment area" means an area or
199	areas designated by a local government in which:
200	1.  Public services such as water and wastewater,
201	transportation, schools, and recreation are already available or
202	are scheduled to be provided in an adopted 5-year schedule of
203	capital improvements.
204	2.  The area, or one or more neighborhoods within the area,
205	suffers from pervasive poverty, unemployment, and general
206	distress as described in s. 290.0058.
207	3.  The area exhibits a proportion of properties that are
208	substandard, overcrowded, dilapidated, vacant or abandoned, or
209	functionally obsolete that is higher than the average for the
210	local government.
211	4.  More than 50 percent of the area is within 1/4 mile of
212	a transit stop, or a sufficient number of such transit stops
213	will be made available concurrent with the designation.
214	5.  The area includes or is adjacent to community
215	redevelopment areas, brownfields, enterprise zones, or Main
216	Street programs or has been designated by the state or Federal
217	Government as an urban redevelopment, revitalization, or infill
218	area under empowerment zone, enterprise community, or brownfield
219	showcase community programs or similar programs.
220	(2)  A new eligible business may apply for a tax credit
221	under this subsection once at any time during its first year of
222	operation. A new eligible business in a designated urban job tax
223	credit tier-one qualified high-crime area which has at least 10
224	qualified employees on the date of application shall receive a
225	$1,500 tax credit for each such employee. A new eligible
226	business in a tier-two qualified high-crime area which has at
227	least 20 qualified employees on the date of application shall
228	receive a $1,000 tax credit for each such employee. A new
229	eligible business in a tier-three qualified high-crime area
230	which has at least 30 qualified employees on the date of
231	application shall receive a $500 tax credit for each such
232	employee.
233	(3)  An existing eligible business may apply for a tax
234	credit under this subsection at any time it is entitled to such
235	credit, except as restricted by this subsection. An existing
236	eligible business in a designated urban job tax credit tier-one
237	qualified high-crime area which on the date of application has
238	at least 5 more qualified employees than it had 1 year prior to
239	its date of application shall receive a $1,500 tax credit for
240	each such additional employee. An existing eligible business in
241	a tier-two qualified high-crime area which on the date of
242	application has at least 10 more qualified employees than it had
243	1 year prior to its date of application shall receive a $1,000
244	credit for each such additional employee. An existing business
245	in a tier-three qualified high-crime area which on the date of
246	application has at least 15 more qualified employees than it had
247	1 year prior to its date of application shall receive a $500 tax
248	credit for each such additional employee. An existing eligible
249	business may apply for the credit under this subsection no more
250	than once in any 12-month period. Any existing eligible business
251	that received a credit under subsection (2) may not apply for
252	the credit under this subsection sooner than 12 months after the
253	application date for the credit under subsection (2).
254	(4)  For any new eligible business receiving a credit
255	pursuant to subsection (2), an additional $500 credit shall be
256	provided for any qualified employee who is a welfare transition
257	program participant. For any existing eligible business
258	receiving a credit pursuant to subsection (3), an additional
259	$500 credit shall be provided for any qualified employee who is
260	a welfare transition program participant. Such employee must be
261	employed on the application date and have been employed less
262	than 1 year. This credit shall be in addition to other credits
263	pursuant to this section regardless of the tier-level of the
264	high-crime area. Appropriate documentation concerning the
265	eligibility of an employee for this credit must be submitted as
266	determined by the department.
267	(5)  To be eligible for a tax credit under subsection (3),
268	the number of qualified employees employed 1 year prior to the
269	application date must be no lower than the number of qualified
270	employees on the application date on which a credit under this
271	section was based for any previous application, including an
272	application under subsection (2).
273	(6)  Any county or municipality, or a county and one or
274	more municipalities together, may apply to the Office of
275	Tourism, Trade, and Economic Development for the designation of
276	an area as a designated urban job tax credit high-crime area
277	after the adoption by the governing body or bodies of a
278	resolution that:
279	(a)  Finds that an urban a high-crime area exists in such
280	county or municipality, or in both the county and one or more
281	municipalities, which chronically exhibits extreme and
282	unacceptable levels of poverty, unemployment, physical
283	deterioration, and economic disinvestment.;
284	(b)  Determines that the rehabilitation, conservation, or
285	redevelopment, or a combination thereof, of such an urban a
286	high-crime area is necessary in the interest of the health,
287	safety, and welfare of the residents of such county or
288	municipality, or such county and one or more municipalities.;
289	and
290	(c)  Determines that the revitalization of such an urban a
291	high-crime area can occur if the public sector or private sector
292	can be induced to invest its own resources in productive
293	enterprises that build or rebuild the economic viability of the
294	area.
295	(7)  The governing body of the entity nominating the area
296	shall demonstrate provide to the Office of Tourism, Trade, and
297	Economic Development that the area meets the following:
298	(a)1.  Forty percent of area residents are earning wages on
299	an annual basis that are equal to or less than the annual wage
300	of a person who is earning minimum wage; or
301	2.  More than 20 percent of residents or families live
302	below the federal standard of poverty for individuals or a
303	family of four. The overall index crime rate for the geographic
304	area;
305	(b)  The area has an unemployment rate at least 3
306	percentage points higher than the state's unemployment rate. The
307	overall index crime volume for the area;
308	(c)  The area has an arrest rate higher than the state's
309	average rate for such crimes as drug sale, drug possession,
310	prostitution, vandalism, and civil disturbances, as recorded by
311	the total crime index of the Department of Law Enforcement. The
312	percentage of reported index crimes that are violent in nature;
313	(d)1.  Fifty percent or more of area residents rent;
314	2.  Property values are within the lower 50 percent of the
315	county's assessed property values;
316	3.  More than 5 percent of area commercial buildings are
317	currently vacant or have been condemned within the previous 24
318	months; or
319	4.  Tax or special assessment delinquencies exceed the fair
320	value of the land for 25 percent of such delinquencies. The
321	reported crime volume and rate of specific property crimes such
322	as business and residential burglary, motor vehicle theft, and
323	vandalism; and
324	(e)  The arrest rates within the geographic area for
325	violent crime and for such other crimes as drug sale, drug
326	possession, prostitution, disorderly conduct, vandalism, and
327	other public-order offenses.
328	(8)  A municipality, or a county and one or more
329	municipalities together, may not nominate more than one urban
330	high-crime area. However, any county as defined by s. 125.011(1)
331	may nominate no more than three urban high-crime areas.
332	(9)  An area nominated by a county or municipality, or a
333	county and one or more municipalities together, for designation
334	as a designated urban job tax credit high-crime area shall be
335	eligible only if it meets the following criteria:
336	(a)  The selected area does not exceed 20 square miles and
337	either has a continuous boundary or consists of not more than
338	three noncontiguous parcels.;
339	(b)  The selected area does not exceed the following
340	mileage limitation:
341	1.  For areas communities having a total population of
342	150,000 persons or more, the selected area does not exceed 20
343	square miles and is within 10 miles of an urban infill and
344	redevelopment area.
345	2.  For areas communities having a total population of
346	50,000 persons or more, but fewer than 150,000 persons, the
347	selected area does not exceed 10 square miles and is within 7.5
348	miles of an urban infill and redevelopment area.
349	3.  For areas communities having a total population of
350	20,000 persons or more, but fewer than 50,000 persons, the
351	selected area does not exceed 5 square miles and is within 5
352	miles of an urban infill and redevelopment area.
353	4.  For areas communities having a total population of
354	fewer than 20,000 persons, the selected area does not exceed 3
355	square miles and is within 3 miles of an urban infill and
356	redevelopment area.
357	(10)(a)  In order to claim this credit, an eligible
358	business must file under oath with the Office of Tourism, Trade,
359	and Economic Development a statement that includes the name and
360	address of the eligible business and any other information that
361	is required to process the application.
362	(b)  Within 30 working days after receipt of an application
363	for credit, the Office of Tourism, Trade, and Economic
364	Development shall review the application to determine whether it
365	contains all the information required by this subsection and
366	meets the criteria set out in this section. Subject to the
367	provisions of paragraph (c), the Office of Tourism, Trade, and
368	Economic Development shall approve all applications that contain
369	the information required by this subsection and meet the
370	criteria set out in this section as eligible to receive a
371	credit.
372	(c)  The maximum credit amount that may be approved during
373	any calendar year is $5 million, of which $1 million shall be
374	exclusively reserved for tier-one areas. The Department of
375	Revenue, in conjunction with the Office of Tourism, Trade, and
376	Economic Development, shall notify the governing bodies in areas
377	designated under this section as urban high-crime areas when the
378	$5 million maximum amount has been reached. Applications must be
379	considered for approval in the order in which they are received
380	without regard to whether the credit is for a new or existing
381	business. This limitation applies to the value of the credit as
382	contained in approved applications. Approved credits may be
383	taken in the time and manner allowed pursuant to this section.
384	(11)  If the application is insufficient to support the
385	credit authorized in this section, the Office of Tourism, Trade,
386	and Economic Development shall deny the credit and notify the
387	business of that fact. The business may reapply for this credit
388	within 3 months after such notification.
389	(12)  If the credit under this section is greater than can
390	be taken on a single tax return, excess amounts may be taken as
391	credits on any tax return submitted within 12 months after the
392	approval of the application by the department.
393	(13)  It is the responsibility of each business to
394	affirmatively demonstrate to the satisfaction of the Department
395	of Revenue that it meets the requirements of this section.
396	(14)  Any person who fraudulently claims this credit is
397	liable for repayment of the credit plus a mandatory penalty of
398	100 percent of the credit and is guilty of a misdemeanor of the
399	second degree, punishable as provided in s. 775.082 or s.
400	775.083.
401	(15)  A corporation may take the credit under this section
402	against its corporate income tax liability, as provided in s.
403	220.1895. However, a corporation that applies its job tax credit
404	against the tax imposed by chapter 220 may not receive the
405	credit provided for in this section. A credit may be taken
406	against only one tax.
407	(16)  The department shall adopt rules governing the manner
408	and form of applications for credit and may establish guidelines
409	concerning the requisites for an affirmative showing of
410	qualification for the credit under this section.
411	Section 3.  Section 220.1895, Florida Statutes, is amended
412	to read:
413	220.1895  Rural Job Tax Credit and Designated Urban High-
414	Crime Area Job Tax Credit.--There shall be allowed a credit
415	against the tax imposed by this chapter amounts approved by the
416	Office of Tourism, Trade, and Economic Development pursuant to
417	the Rural Job Tax Credit Program in s. 212.098 and the
418	Designated Urban High-Crime Area Job Tax Credit Area Program in
419	s. 212.097. A corporation that uses its credit against the tax
420	imposed by this chapter may not take the credit against the tax
421	imposed by chapter 212. If any credit granted under this section
422	is not fully used in the first year for which it becomes
423	available, the unused amount may be carried forward for a period
424	not to exceed 5 years. The carryover may be used in a subsequent
425	year when the tax imposed by this chapter for such year exceeds
426	the credit for such year under this section after applying the
427	other credits and unused credit carryovers in the order provided
428	in s. 220.02(8).
429	Section 4.  Subsection (2) and paragraph (j) of subsection
430	(3) of section 288.99, Florida Statutes, are amended to read:
431	288.99  Certified Capital Company Act.--
432	(2)  PURPOSE.--The primary purpose of this act is to
433	stimulate a substantial increase in venture capital investments
434	in this state by providing an incentive for insurance companies
435	to invest in certified capital companies in this state which, in
436	turn, will make investments in new businesses or in expanding
437	businesses, including minority-owned or minority-operated
438	businesses and businesses located in a designated Front Porch
439	community, enterprise zone, designated urban job tax credit
440	high-crime area, rural job tax credit county, or nationally
441	recognized historic district. The increase in investment capital
442	flowing into new or expanding businesses is intended to
443	contribute to employment growth, create jobs which exceed the
444	average wage for the county in which the jobs are created, and
445	expand or diversify the economic base of this state.
446	(3)  DEFINITIONS.--As used in this section, the term:
447	(j)  "Qualified business" means the Digital Divide Trust
448	Fund established under the State of Florida Technology Office or
449	a business that meets the following conditions as evidenced by
450	documentation required by commission rule:
451	1.  The business is headquartered in this state and its
452	principal business operations are located in this state or at
453	least 75 percent of the employees are employed in the state.
454	2.  At the time a certified capital company makes an
455	initial investment in a business, the business would qualify for
456	investment under 13 C.F.R. s. 121.301(c), which is involved in
457	manufacturing, processing or assembling products, conducting
458	research and development, or providing services.
459	3.  At the time a certified capital company makes an
460	initial investment in a business, the business certifies in an
461	affidavit that:
462	a.  The business is unable to obtain conventional
463	financing, which means that the business has failed in an
464	attempt to obtain funding for a loan from a bank or other
465	commercial lender or that the business cannot reasonably be
466	expected to qualify for such financing under the standards of
467	commercial lending.;
468	b.  The business plan for the business projects that the
469	business is reasonably expected to achieve in excess of $25
470	million in sales revenue within 5 years after the initial
471	investment, or the business is located in a designated Front
472	Porch community, enterprise zone, designated urban job tax
473	credit high crime area, rural job tax credit county, or
474	nationally recognized historic district.;
475	c.  The business will maintain its headquarters in this
476	state for the next 10 years and any new manufacturing facility
477	financed by a qualified investment will remain in this state for
478	the next 10 years, or the business is located in a designated
479	Front Porch community, enterprise zone, designated urban job tax
480	credit high crime area, rural job tax credit county, or
481	nationally recognized historic district.; and
482	d.  The business has fewer than 200 employees and at least
483	75 percent of the employees are employed in this state. For
484	purposes of this subsection, the term also includes the Florida
485	Black Business Investment Board, any entity majority owned by
486	the Florida Black Business Investment Board, or any entity in
487	which the Florida Black Business Investment Board holds a
488	majority voting interest on the board of directors.
489	4.  The term does not include:
490	a.  Any business predominantly engaged in retail sales,
491	real estate development, insurance, banking, lending, or oil and
492	gas exploration.
493	b.  Any business predominantly engaged in professional
494	services provided by accountants, lawyers, or physicians.
495	c.  Any company that has no historical revenues and either
496	has no specific business plan or purpose or has indicated that
497	its business plan is solely to engage in a merger or acquisition
498	with any unidentified company or other entity.
499	d.  Any company that has a strategic plan to grow through
500	the acquisition of firms with substantially similar business
501	which would result in the planned net loss of Florida-based jobs
502	over a 12-month period after the acquisition as determined by
503	the office.
504	Section 5.  This act shall take effect July 1, 2006.

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