HB 7055CS

CHAMBER ACTION



1The Finance & Tax Committee recommends the following:
2
3     Council/Committee Substitute
4     Remove the entire bill and insert:
5
A bill to be entitled
6An act relating to enterprise zones; amending s. 195.099,
7F.S.; reenacting a periodic review requirement; providing
8for future expiration; amending s. 220.03, F.S.; revising
9a definition; amending s. 212.08, F.S.; limiting the
10exemption by refund of certain taxes for rehabilitation of
11certain property in an enterprise zone; providing an
12exception; providing for retroactive application; amending
13s. 212.096, F.S.; revising definitions; revising an
14information requirement for claiming an enterprise zone
15jobs tax credit; amending s. 220.13, F.S.; reenacting a
16definitional provision; providing for future expiration of
17provisions relating to enterprise zone credits; amending
18s. 220.181, F.S.; revising certain criteria for granting
19an enterprise zone jobs tax credit; amending s. 290.0055,
20F.S.; providing a meeting notice requirement for a
21governing body adopting an enterprise zone boundary change
22resolution; providing for time-limited continuing
23eligibility for a building materials tax exemption for
24certain businesses; specifying eligibility requirements;
25providing for retroactive application; providing for
26future repeal; providing an effective date.
27
28Be It Enacted by the Legislature of the State of Florida:
29
30     Section 1.  Subsection (1) of section 195.099, Florida
31Statutes, is reenacted and amended to read:
32     195.099  Periodic review.--
33     (1)(a)  The department shall periodically review the
34assessments of new, rebuilt, and expanded business reported
35according to s. 193.077(3), to ensure parity of level of
36assessment with other classifications of property.
37     (b)  The provisions of This subsection shall expire and be
38void on the date specified in s. 290.016 for the expiration of
39the Florida Enterprise Zone Act June 30, 2005.
40     Section 2.  Paragraph (ff) of subsection (1) of section
41220.03, Florida Statutes, is amended to read:
42     220.03  Definitions.--
43     (1)  SPECIFIC TERMS.--When used in this code, and when not
44otherwise distinctly expressed or manifestly incompatible with
45the intent thereof, the following terms shall have the following
46meanings:
47     (ff)  "New job has been created" means that, on the date of
48application, the total number of full-time jobs is greater than
49the total was has increased in an enterprise zone from the
50average of the previous 12 months prior to that date, as
51demonstrated to the department by a business located in the
52enterprise zone.
53     Section 3.  Paragraph (g) of subsection (5) of section
54212.08, Florida Statutes, is amended to read:
55     212.08  Sales, rental, use, consumption, distribution, and
56storage tax; specified exemptions.--The sale at retail, the
57rental, the use, the consumption, the distribution, and the
58storage to be used or consumed in this state of the following
59are hereby specifically exempt from the tax imposed by this
60chapter.
61     (5)  EXEMPTIONS; ACCOUNT OF USE.--
62     (g)  Building materials used in the rehabilitation of real
63property located in an enterprise zone.--
64     1.  Building materials used in the rehabilitation of real
65property located in an enterprise zone shall be exempt from the
66tax imposed by this chapter upon an affirmative showing to the
67satisfaction of the department that the items have been used for
68the rehabilitation of real property located in an enterprise
69zone. Except as provided in subparagraph 2., this exemption
70inures to the owner, lessee, or lessor of the rehabilitated real
71property located in an enterprise zone only through a refund of
72previously paid taxes. To receive a refund pursuant to this
73paragraph, the owner, lessee, or lessor of the rehabilitated
74real property located in an enterprise zone must file an
75application under oath with the governing body or enterprise
76zone development agency having jurisdiction over the enterprise
77zone where the business is located, as applicable, which
78includes:
79     a.  The name and address of the person claiming the refund.
80     b.  An address and assessment roll parcel number of the
81rehabilitated real property in an enterprise zone for which a
82refund of previously paid taxes is being sought.
83     c.  A description of the improvements made to accomplish
84the rehabilitation of the real property.
85     d.  A copy of the building permit issued for the
86rehabilitation of the real property.
87     e.  A sworn statement, under the penalty of perjury, from
88the general contractor licensed in this state with whom the
89applicant contracted to make the improvements necessary to
90accomplish the rehabilitation of the real property, which
91statement lists the building materials used in the
92rehabilitation of the real property, the actual cost of the
93building materials, and the amount of sales tax paid in this
94state on the building materials. In the event that a general
95contractor has not been used, the applicant shall provide this
96information in a sworn statement, under the penalty of perjury.
97Copies of the invoices which evidence the purchase of the
98building materials used in such rehabilitation and the payment
99of sales tax on the building materials shall be attached to the
100sworn statement provided by the general contractor or by the
101applicant. Unless the actual cost of building materials used in
102the rehabilitation of real property and the payment of sales
103taxes due thereon is documented by a general contractor or by
104the applicant in this manner, the cost of such building
105materials shall be an amount equal to 40 percent of the increase
106in assessed value for ad valorem tax purposes.
107     f.  The identifying number assigned pursuant to s. 290.0065
108to the enterprise zone in which the rehabilitated real property
109is located.
110     g.  A certification by the local building code inspector
111that the improvements necessary to accomplish the rehabilitation
112of the real property are substantially completed.
113     h.  Whether the business is a small business as defined by
114s. 288.703(1).
115     i.  If applicable, the name and address of each permanent
116employee of the business, including, for each employee who is a
117resident of an enterprise zone, the identifying number assigned
118pursuant to s. 290.0065 to the enterprise zone in which the
119employee resides.
120     2.  This exemption inures to a city, county, other
121governmental agency, or nonprofit community-based organization
122through a refund of previously paid taxes if the building
123materials used in the rehabilitation of real property located in
124an enterprise zone are paid for from the funds of a community
125development block grant, State Housing Initiatives Partnership
126Program, or similar grant or loan program. To receive a refund
127pursuant to this paragraph, a city, county, other governmental
128agency, or nonprofit community-based organization must file an
129application which includes the same information required to be
130provided in subparagraph 1. by an owner, lessee, or lessor of
131rehabilitated real property. In addition, the application must
132include a sworn statement signed by the chief executive officer
133of the city, county, other governmental agency, or nonprofit
134community-based organization seeking a refund which states that
135the building materials for which a refund is sought were paid
136for from the funds of a community development block grant, State
137Housing Initiatives Partnership Program, or similar grant or
138loan program.
139     3.  Within 10 working days after receipt of an application,
140the governing body or enterprise zone development agency shall
141review the application to determine if it contains all the
142information required pursuant to subparagraph 1. or subparagraph
1432. and meets the criteria set out in this paragraph. The
144governing body or agency shall certify all applications that
145contain the information required pursuant to subparagraph 1. or
146subparagraph 2. and meet the criteria set out in this paragraph
147as eligible to receive a refund. If applicable, the governing
148body or agency shall also certify if 20 percent of the employees
149of the business are residents of an enterprise zone, excluding
150temporary and part-time employees. The certification shall be in
151writing, and a copy of the certification shall be transmitted to
152the executive director of the Department of Revenue. The
153applicant shall be responsible for forwarding a certified
154application to the department within the time specified in
155subparagraph 4.
156     4.  An application for a refund pursuant to this paragraph
157must be submitted to the department within 6 months after the
158rehabilitation of the property is deemed to be substantially
159completed by the local building code inspector or by September 1
160after the rehabilitated property is first subject to assessment.
161     5.  The provisions of s. 212.095 do not apply to any refund
162application made pursuant to this paragraph. Not more than one
163exemption through a refund of previously paid taxes for the
164rehabilitation of real property shall be permitted for any
165single parcel of property unless there is a change in ownership,
166a new lessor, or a new lessee of the real property. No refund
167shall be granted pursuant to this paragraph unless the amount to
168be refunded exceeds $500. No refund granted pursuant to this
169paragraph shall exceed the lesser of 97 percent of the Florida
170sales or use tax paid on the cost of the building materials used
171in the rehabilitation of the real property as determined
172pursuant to sub-subparagraph 1.e. or $5,000, or, if no less than
17320 percent of the employees of the business are residents of an
174enterprise zone, excluding temporary and part-time employees,
175the amount of refund granted pursuant to this paragraph shall
176not exceed the lesser of 97 percent of the sales tax paid on the
177cost of such building materials or $10,000. A refund approved
178pursuant to this paragraph shall be made within 30 days of
179formal approval by the department of the application for the
180refund. This subparagraph shall apply retroactively to July 1,
1812005.
182     6.  The department shall adopt rules governing the manner
183and form of refund applications and may establish guidelines as
184to the requisites for an affirmative showing of qualification
185for exemption under this paragraph.
186     7.  The department shall deduct an amount equal to 10
187percent of each refund granted under the provisions of this
188paragraph from the amount transferred into the Local Government
189Half-cent Sales Tax Clearing Trust Fund pursuant to s. 212.20
190for the county area in which the rehabilitated real property is
191located and shall transfer that amount to the General Revenue
192Fund.
193     8.  For the purposes of the exemption provided in this
194paragraph:
195     a.  "Building materials" means tangible personal property
196which becomes a component part of improvements to real property.
197     b.  "Real property" has the same meaning as provided in s.
198192.001(12).
199     c.  "Rehabilitation of real property" means the
200reconstruction, renovation, restoration, rehabilitation,
201construction, or expansion of improvements to real property.
202     d.  "Substantially completed" has the same meaning as
203provided in s. 192.042(1).
204     9.  This paragraph expires on the date specified in s.
205290.016 for the expiration of the Florida Enterprise Zone Act.
206     Section 4.  Paragraphs (a) and (e) of subsection (1) and
207paragraph (e) of subsection (3) of section 212.096, Florida
208Statutes, are amended to read:
209     212.096  Sales, rental, storage, use tax; enterprise zone
210jobs credit against sales tax.--
211     (1)  For the purposes of the credit provided in this
212section:
213     (a)  "Eligible business" means any sole proprietorship,
214firm, partnership, corporation, bank, savings association,
215estate, trust, business trust, receiver, syndicate, or other
216group or combination, or successor business, located in an
217enterprise zone. The business must demonstrate to the department
218that, on the date of application, the total number of full-time
219jobs defined under paragraph (d) is greater than the total was
220has increased from the average of the previous 12 months prior
221to that date. An eligible business does not include any business
222which has claimed the credit permitted under s. 220.181 for any
223new business employee first beginning employment with the
224business after July 1, 1995.
225     (e)  "New job has been created" means that, on the date of
226application, the total number of full-time jobs is greater than
227the total was has increased in an enterprise zone from the
228average of the previous 12 months prior to that date, as
229demonstrated to the department by a business located in the
230enterprise zone.
231
232A person shall be deemed to be employed if the person performs
233duties in connection with the operations of the business on a
234regular, full-time basis, provided the person is performing such
235duties for an average of at least 36 hours per week each month.
236The person must be performing such duties at a business site
237located in the enterprise zone.
238     (3)  In order to claim this credit, an eligible business
239must file under oath with the governing body or enterprise zone
240development agency having jurisdiction over the enterprise zone
241where the business is located, as applicable, a statement which
242includes:
243     (e)  Demonstration to the department that, on the date of
244application, the total number of full-time jobs defined under
245paragraph (1)(d) is greater than the total was has increased in
246an enterprise zone from the average of the previous 12 months
247prior to that date.
248     Section 5.  Paragraph (a) of subsection (1) of section
249220.13, Florida Statutes, is reenacted and amended to read:
250     220.13  "Adjusted federal income" defined.--
251     (1)  The term "adjusted federal income" means an amount
252equal to the taxpayer's taxable income as defined in subsection
253(2), or such taxable income of more than one taxpayer as
254provided in s. 220.131, for the taxable year, adjusted as
255follows:
256     (a)  Additions.--There shall be added to such taxable
257income:
258     1.  The amount of any tax upon or measured by income,
259excluding taxes based on gross receipts or revenues, paid or
260accrued as a liability to the District of Columbia or any state
261of the United States which is deductible from gross income in
262the computation of taxable income for the taxable year.
263     2.  The amount of interest which is excluded from taxable
264income under s. 103(a) of the Internal Revenue Code or any other
265federal law, less the associated expenses disallowed in the
266computation of taxable income under s. 265 of the Internal
267Revenue Code or any other law, excluding 60 percent of any
268amounts included in alternative minimum taxable income, as
269defined in s. 55(b)(2) of the Internal Revenue Code, if the
270taxpayer pays tax under s. 220.11(3).
271     3.  In the case of a regulated investment company or real
272estate investment trust, an amount equal to the excess of the
273net long-term capital gain for the taxable year over the amount
274of the capital gain dividends attributable to the taxable year.
275     4.  That portion of the wages or salaries paid or incurred
276for the taxable year which is equal to the amount of the credit
277allowable for the taxable year under s. 220.181. The provisions
278of This subparagraph shall expire and be void on the date
279specified in s. 290.016 for the expiration of the Florida
280Enterprise Zone Act June 30, 2005.
281     5.  That portion of the ad valorem school taxes paid or
282incurred for the taxable year which is equal to the amount of
283the credit allowable for the taxable year under s. 220.182. The
284provisions of This subparagraph shall expire and be void on the
285date specified in s. 290.016 for the expiration of the Florida
286Enterprise Zone Act June 30, 2005.
287     6.  The amount of emergency excise tax paid or accrued as a
288liability to this state under chapter 221 which tax is
289deductible from gross income in the computation of taxable
290income for the taxable year.
291     7.  That portion of assessments to fund a guaranty
292association incurred for the taxable year which is equal to the
293amount of the credit allowable for the taxable year.
294     8.  In the case of a nonprofit corporation which holds a
295pari-mutuel permit and which is exempt from federal income tax
296as a farmers' cooperative, an amount equal to the excess of the
297gross income attributable to the pari-mutuel operations over the
298attributable expenses for the taxable year.
299     9.  The amount taken as a credit for the taxable year under
300s. 220.1895.
301     10.  Up to nine percent of the eligible basis of any
302designated project which is equal to the credit allowable for
303the taxable year under s. 220.185.
304     11.  The amount taken as a credit for the taxable year
305under s. 220.187.
306     Section 6.  Paragraph (a) of subsection (1) and paragraph
307(f) of subsection (2) of section 220.181, Florida Statutes, are
308amended to read:
309     220.181  Enterprise zone jobs credit.--
310     (1)(a)  There shall be allowed a credit against the tax
311imposed by this chapter to any business located in an enterprise
312zone which demonstrates to the department that, on the date of
313application, the total number of full-time jobs is greater than
314the total was has increased from the average of the previous 12
315months prior to that date. The credit shall be computed as 20
316percent of the actual monthly wages paid in this state to each
317new employee hired when a new job has been created, as defined
318under s. 220.03(1)(ff), unless the business is located in a
319rural enterprise zone, pursuant to s. 290.004(6), in which case
320the credit shall be 30 percent of the actual monthly wages paid.
321If no less than 20 percent of the employees of the business are
322residents of an enterprise zone, excluding temporary and part-
323time employees, the credit shall be computed as 30 percent of
324the actual monthly wages paid in this state to each new employee
325hired when a new job has been created, unless the business is
326located in a rural enterprise zone, in which case the credit
327shall be 45 percent of the actual monthly wages paid, for a
328period of up to 24 consecutive months. If the new employee hired
329when a new job is created is a participant in the welfare
330transition program, the following credit shall be a percent of
331the actual monthly wages paid: 40 percent for $4 above the
332hourly federal minimum wage rate; 41 percent for $5 above the
333hourly federal minimum wage rate; 42 percent for $6 above the
334hourly federal minimum wage rate; 43 percent for $7 above the
335hourly federal minimum wage rate; and 44 percent for $8 above
336the hourly federal minimum wage rate.
337     (2)  When filing for an enterprise zone jobs credit, a
338business must file under oath with the governing body or
339enterprise zone development agency having jurisdiction over the
340enterprise zone where the business is located, as applicable, a
341statement which includes:
342     (f)  Demonstration to the department that, on the date of
343application, the total number of full-time jobs is greater than
344the total was has increased from the average of the previous 12
345months prior to that date.
346     Section 7.  Paragraph (c) is added to subsection (6) of
347section 290.0055, Florida Statutes, to read:
348     290.0055  Local nominating procedure.--
349     (6)
350     (c)  At least 90 days before adopting a resolution seeking
351a change in the boundary of an enterprise zone, the governing
352body shall include in a notice of the meeting at which the
353resolution will be considered an explanation that a change in
354the boundary of an enterprise zone will be considered and that
355the change may result in loss of enterprise zone eligibility for
356the area affected by the boundary change.
357     Section 8.  (1)  Notwithstanding the provisions of s.
358212.08(5)(g), Florida Statutes, as amended by this act, a
359business developing a project involving the rehabilitation of
360real property that has been excluded from an enterprise zone
361because of the redesignation requirements of s. 290.012 or s.
362290.0065, Florida Statutes, shall remain eligible to apply for
363the building materials tax exemption under s. 212.08(5)(g),
364Florida Statutes, for that project through December 31, 2007, if
365the following requirements are met:
366     (a)  The project must have been located in an enterprise
367zone on or before December 31, 2005.
368     (b)  The project must have a duration extending beyond
369December 31, 2005.
370     (c)  The project must have been excluded from the
371enterprise zone due to the portion of the enterprise zone in
372which the project is located not meeting the pervasive poverty
373rate requirements of s. 290.0058(2)(a) or (b), Florida Statutes.
374     (d)  The difference between the pervasive poverty rate
375requirements of s. 290.0058(2)(a), Florida Statutes, and the
376actual poverty rate in the area in which the project is located
377must be 5 percentage points or less.
378     (e)  The business must apply for a certificate of
379eligibility for the project with the enterprise zone development
380agency by November 1, 2006, and demonstrate that the project
381meets the requirements of this section.
382     (f)  The enterprise zone development agency must provide a
383copy of the certificate of eligibility to the Department of
384Revenue.
385     (2)  The provisions of this section are remedial in nature
386and shall apply retroactively to December 31, 2005. This section
387is repealed December 31, 2007.
388     Section 9.  This act shall take effect upon becoming a law.


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