Florida Senate - 2010 CS for SB 1992 By the Committee on Commerce; and Senator Ring 577-04347-10 20101992c1 1 A bill to be entitled 2 An act relating to Florida ports investments; creating 3 s. 311.23, F.S.; providing a short title; providing a 4 purpose; providing definitions; creating the Florida 5 Ports Investment Corporation; subjecting the 6 corporation to certain public-meetings and public 7 records requirements; providing authority and 8 requirements for the corporation; providing for a 9 board of directors; providing for appointment of board 10 members; providing for investments by the corporation 11 in certain port projects; providing port project 12 funding criteria; providing requirements for capital 13 allocation and investments; providing requirements for 14 certain uninvested capital; providing requirements for 15 investments; providing for a premium tax credit; 16 providing for carryforward of the credit; providing 17 limitations on the credit; providing limitations on 18 the amount of tax credits; providing investment 19 requirements; providing procedures, requirements, and 20 limitations for transfers of unused credits; 21 authorizing the corporation and the Office of Tourism, 22 Trade, and Economic Development to charge certain 23 fees; providing reporting requirements; authorizing 24 the Department of Revenue and the office to adopt 25 rules; amending s. 213.053, F.S.; authorizing the 26 Department of Revenue to provide certain information 27 to the office; providing an effective date. 28 29 Be It Enacted by the Legislature of the State of Florida: 30 31 Section 1. Section 311.23, Florida Statutes, is created to 32 read: 33 311.23 Florida Ports Investment Act.— 34 (1) SHORT TITLE.—This section may be cited as the “Florida 35 Ports Investment Act.” 36 (2) PURPOSE.—The primary purpose of this section is to 37 stimulate a substantial increase in the state’s port 38 infrastructure by providing an incentive for investment in new 39 or expanding port and port-related projects. The increase in 40 investment capital flowing into new or expanding port activities 41 and businesses is intended to contribute to employment growth, 42 create jobs that exceed the average wage for the county in which 43 the jobs are located, and expand or diversify the economic base 44 of this state. 45 (3) DEFINITIONS.—As used in this section, the term: 46 (a) “Corporation” means the Florida Ports Investment 47 Corporation created under subsection (4). 48 (b) “Investment capital” means an investment of cash by a 49 participating investor in the corporation in exchange for the 50 tax credits provided in this section. 51 (c) “Office” means the Office of Tourism, Trade, and 52 Economic Development. 53 (d) “Participating investor” means any qualified investor 54 subject to the Internal Revenue Code and that contributes 55 investment capital pursuant to this section. 56 (e) “Premium tax liability” means any liability incurred by 57 an insurance company under s. 624.509. 58 (f) “Qualified port project” means the ports listed in s. 59 403.021(9)(b) or any associated business or project that uses 60 those ports for the movement of goods and people, as determined 61 by the corporation. 62 (4) FLORIDA PORTS INVESTMENT CORPORATION; CREATION; 63 AUTHORITY; BOARD OF DIRECTORS.— 64 (a) The Florida Ports Investment Corporation is created as 65 a corporation not for profit, to be incorporated under the 66 provisions of chapter 617, and registered with the Department of 67 State as a Florida entity. The Legislature determines that 68 public policy dictates that the corporation operate in the most 69 open and accessible manner consistent with its public purpose. 70 Therefore, the Legislature specifically declares that the 71 corporation and its advisory company are subject to the public 72 records and meetings requirements of chapters 119 and 286. 73 (b) The corporation: 74 1. May receive, hold, invest, and administer funds and make 75 expenditures consistent with the purposes of this section. 76 2. May make purchases, sales, exchanges, investments, and 77 reinvestments for and on behalf of the funds received pursuant 78 to this section. 79 3. Maintain all official records related to its activities. 80 4. Shall retain, pursuant to the provisions of s. 287.055, 81 at least one investment advisory company domiciled in the state 82 of Florida, with at least 5 years of experience in working with 83 investors seeking tax credits or other debt-driven instruments, 84 to assist the corporation in carrying out the provisions of this 85 section. 86 5. Shall timely provide the office with information about 87 its participating investors and the amount of their investments 88 to assist the office in awarding the available tax credits, and 89 a list of certified port projects. 90 6. Shall assist the office in developing the required 91 annual report in subsection (10). 92 (c) The corporation shall be governed by a board of 93 directors comprised of: 94 1. The director of the office, who shall serve as the 95 chair. 96 2. Two members appointed by the Governor, two members 97 appointed by the President of the Senate, and two members 98 appointed by the Speaker of the House of Representatives. These 99 appointed members must have significant experience in 100 international business, transportation, law, or logistics. 101 Appointed members are subject to any restrictions on conflicts 102 of interest specified in the organizational documents of the 103 corporation and may not have any interest in any investments 104 made by the corporation pursuant to subsection (5). 105 3. The chair of the Florida Seaport Transportation and 106 Economic Development Council. 107 4. The Secretary of Transportation. 108 5. Each appointed member shall be appointed for a term of 4 109 years. A vacancy on the board shall be filled by the appointing 110 official for the member whose vacancy is to be filled or whose 111 term has expired. An appointed member may be removed by the 112 appointing official for that member, for cause. Absence from 113 three consecutive meetings shall result in automatic removal. 114 Any appointed member is eligible for reappointment. 115 6. Members of the board shall serve without compensation, 116 but may be reimbursed for all reasonable, necessary, and actual 117 expenses as determined and approved by the board pursuant to s. 118 112.061. 119 (5) INVESTMENTS BY THE CORPORATION IN PORT PROJECTS AND 120 PORT-RELATED ACTIVITIES.— 121 (a)1. The corporation shall seek to maintain the economic 122 competitiveness of Florida’s ports and their related import and 123 export industries by funding projects that increase the ports’ 124 capacity to handle freight; are consistent with approved seaport 125 master plans; and improve economic productivity for the state or 126 the region in which projects are located. Also eligible for 127 investment capital under this section are on-port projects that 128 are eligible for federal financial assistance consistent with 129 criteria developed for federal freight transportation grant 130 programs, including, but not limited to, the Transportation 131 Investment Generating Economic Recovery (TIGER), Projects of 132 National and Regional Significance (PNRS), National 133 Infrastructure Investment (NII), and the National Corridor 134 Infrastructure Improvement (NCII) program. 135 2. The capital received under this section shall be 136 allocated to eligible projects commencing by July 1, 2012, or 137 held in accordance with paragraph (b). 138 3. Funding for such projects shall be on a matching basis 139 as determined by the corporation, except that at least 25 140 percent of total project funds must come from port funds, local 141 funds, private funds, or federal funds. 142 (b) The corporation shall hold all capital that is received 143 under this section and that is not invested in qualified port 144 projects, and such capital: 145 1. Must be held in a financial institution as defined by s. 146 655.005(1)(h) or held by a broker-dealer registered under s. 147 517.12. 148 2. Must be invested only in: 149 a. United States Treasury obligations; 150 b. Certificates of deposit or other obligations, maturing 151 within 3 years after acquisition of such certificates or 152 obligations, issued by any financial institution or trust 153 company incorporated under the laws of the United States; 154 c. Marketable obligations, maturing within 5 years or less 155 after the acquisition of such obligations, which are rated “A” 156 or better by any nationally recognized credit rating agency; or 157 d. Interests in money market funds, the portfolio of which 158 is limited to cash and obligations described in sub 159 subparagraphs a.-c. 160 (c) All investment decisions shall be made by the 161 corporation, which must certify that each project is of a 162 beneficial nature to a port listed in s. 403.021(9)(b); is ready 163 to proceed within 60 days for design, construction, and 164 permitting; and will create a lasting economic impact as 165 determined by the board. Applications for funding by qualified 166 port projects must be made to the corporation. The board, in 167 consultation with the office, may establish procedural rules for 168 the application form, application procedures, and criteria for 169 making investment decisions based upon the requirements 170 established in this paragraph. 171 (6) PREMIUM TAX CREDIT; AMOUNT; LIMITATIONS.— 172 (a) Any participating investor who makes an investment of 173 investment capital shall earn a vested credit against premium 174 tax liability equal to 100 percent of the face amount of the 175 credits purchased by the participating investor and such 176 investments may not be subject to recapture, disallowance, 177 forfeiture, or reduction. 178 (b) Participating investors shall be entitled to use no 179 more than 10 percentage points of the vested premium tax credit, 180 including any carryforward credits under this section, per year 181 beginning with premium tax filings for calendar year 2013. 182 (c) Any premium tax credits not used by participating 183 investors in any single year may be carried forward and applied 184 against the premium tax liabilities of such investors for 185 subsequent calendar years. The carryforward credit may be 186 applied against subsequent premium tax filings through calendar 187 year 2029. 188 (d) The credit to be applied against premium tax liability 189 in any single year may not exceed the premium tax liability of 190 the participating investor for that taxable year. 191 (e) A participating investor claiming a credit against 192 premium tax liability earned through an investment in the 193 corporation, or a transferee, is not required to pay any 194 additional retaliatory tax levied pursuant to s. 624.5091 as a 195 result of claiming such credit. Because credits under this 196 section are available to a participating investor, s. 624.5091 197 does not limit such credit in any manner. 198 (7) ANNUAL TAX CREDIT; MAXIMUM AMOUNT.— 199 (a) The total amount of tax credits which may be allocated 200 by the office may not exceed $100 million. The total amount of 201 tax credits which may be used by participating investors under 202 this section may not exceed $10 million annually. 203 (b) The office shall be responsible for allocating premium 204 tax credits as provided for in this section to participating 205 investors. A participating investor must submit an application 206 to the office for the tax credit authorized in this section. 207 (8) TRANSFER OF TAX CREDITS.— 208 (a) Upon application to and approval by the office, a 209 participating investor may elect to transfer, in whole or in 210 part, any unused credit amount granted under this section. The 211 office shall notify the Department of Revenue of the election 212 and transfer. 213 (b) A participating investor that elects to apply a credit 214 amount against taxes remitted under s. 624.509 is permitted a 215 one-time transfer of unused credits to one transferee, and such 216 transfer must occur in the same taxable year. 217 (c) The transferee is subject to the same rights and 218 limitations as the participating investor awarded the tax 219 credit, except that the transferee may not sell or otherwise 220 transfer the tax credit. 221 (9) AUDIT AUTHORITY; REVOCATION AND FORFEITURE OF TAX 222 CREDITS; FRAUDULENT CLAIMS.— 223 (a) Audit authority.—The Department of Revenue may conduct 224 examinations and audits as provided in s. 213.34 to verify that 225 tax credits under this section are received, transferred, and 226 applied according to the requirements of this section. If the 227 Department of Revenue determines that tax credits are not 228 received, transferred, or applied as required by this section, 229 it may, in addition to the remedies provided in this subsection, 230 pursue recovery of such funds pursuant to the laws and rules 231 governing the assessment of taxes. 232 (b) Revocation of tax credits.—The office may revoke or 233 modify any written decision qualifying, certifying, or otherwise 234 granting eligibility for tax credits under this section if it is 235 discovered that the tax credit applicant submitted any false 236 statement, representation, or certification in any application, 237 record, report, plan, or other document filed in an attempt to 238 receive tax credits under this section. The office shall 239 immediately notify the Department of Revenue of any revoked or 240 modified orders affecting previously granted tax credits. 241 Additionally, the applicant must notify the Department of 242 Revenue of any change in its tax credit claimed. 243 (c) Forfeiture of tax credits.—A determination by the 244 Department of Revenue, as a result of an audit or examination by 245 the Department of Revenue or from information received from the 246 office, that an applicant received tax credits pursuant to this 247 section to which the applicant was not entitled is grounds for 248 forfeiture of previously claimed and received tax credits. The 249 applicant is responsible for returning forfeited tax credits to 250 the Department of Revenue, and such funds shall be paid into the 251 General Revenue Fund of the state. Tax credits purchased in good 252 faith are not subject to forfeiture unless the transferee 253 submitted fraudulent information in the purchase or otherwise 254 failed to meet the requirements of this section. 255 (d) Fraudulent claims.—Any applicant that submits 256 fraudulent information under this section is liable for 257 reimbursement of the reasonable costs and fees associated with 258 the review, processing, investigation, and prosecution of the 259 fraudulent claim. An applicant that obtains a credit payment 260 under this section through a claim that is fraudulent is liable 261 for reimbursement of the credit amount plus a penalty in an 262 amount double the credit amount. The penalty is in addition to 263 any criminal penalty to which the applicant is liable for the 264 same acts. The applicant is also liable for costs and fees 265 incurred by the state in investigating and prosecuting the 266 fraudulent claim. 267 (10) REPORTING REQUIREMENTS.—Beginning February 1, 2013, 268 and every year thereafter, the office shall report on an annual 269 basis to the Governor, the President of the Senate, and the 270 Speaker of the House of Representatives: 271 (a) The total dollar amount received by the corporation 272 from all participating investors and any other investor, the 273 identity of the participating investors, and the total amount of 274 premium tax credit used by each participating investor for the 275 previous calendar year. 276 (b) The total dollar amount invested by the corporation in 277 qualified port projects, the identity and location of those 278 projects, the amount invested in each qualified port project, 279 and the total number of permanent, full-time jobs created or 280 retained by each qualified port project. 281 (c) The return for the state as a result of the investments 282 in qualified port projects, including the extent to which: 283 1. Investments have contributed to employment growth. 284 2. The wage level of businesses in which the corporation 285 has invested exceeds the average wage for the county in which 286 the jobs are located. 287 3. The investments of the corporation in qualified port 288 projects have contributed to expanding or diversifying the 289 economic base of the state. 290 (11) FEES.—The corporation may charge reasonable fees for 291 administering and processing applications by qualified port 292 projects for funding pursuant to paragraph (5)(c), and the 293 office may charge reasonable fees for administering and 294 processing applications by participating investors for tax 295 credits pursuant to subsection (7). Any fee charged by the 296 corporation or office under this subsection for an application 297 may not exceed the actual cost incurred by the corporation or 298 office in administering and processing any application for 299 funding or a tax credit. 300 (12) RULEMAKING AUTHORITY.— 301 (a) The Department of Revenue may adopt rules pursuant to 302 ss. 120.536(1) and 120.54 to administer this section, including, 303 but not limited to, rules governing the examination and audit 304 procedures required to administer this section and the manner 305 and form of documentation required to claim tax credits awarded 306 or transferred under this section. 307 (b) The office may adopt rules pursuant to ss. 120.536(1) 308 and 120.54 and develop procedures to administer this section, 309 including, but not limited to, rules specifying requirements for 310 the application and approval process, records required for 311 substantiation for tax credits, and the manner and form of 312 documentation required to claim tax credits awarded or 313 transferred under this section. 314 Section 2. Paragraph (z) is added to subsection (8) of 315 section 213.053, Florida Statutes, to read: 316 213.053 Confidentiality and information sharing.— 317 (8) Notwithstanding any other provision of this section, 318 the department may provide: 319 (z) Information relating to tax credits taken under s. 320 624.509 to the Office of Tourism, Trade, and Economic 321 Development. 322 323 Disclosure of information under this subsection shall be 324 pursuant to a written agreement between the executive director 325 and the agency. Such agencies, governmental or nongovernmental, 326 shall be bound by the same requirements of confidentiality as 327 the Department of Revenue. Breach of confidentiality is a 328 misdemeanor of the first degree, punishable as provided by s. 329 775.082 or s. 775.083. 330 Section 3. This act shall take effect July 1, 2010.