Florida Senate - 2010 CS for SB 2578 By the Committee on General Government Appropriations; and Senator Altman 601-04797-10 20102578c1 1 A bill to be entitled 2 An act relating to the advanced clean energy 3 development tax credit; creating s. 220.194, F.S.; 4 defining terms; authorizing a business to receive the 5 advanced clean energy development tax credit for a 6 project to conduct clean energy research in 7 development within the territory of the John F. 8 Kennedy Space Center; specifying amounts of the 9 credit; requiring a business to apply to Space Florida 10 for eligibility to receive the tax credit; requiring 11 the applicant that is qualified to receive the credit 12 to execute and deliver a written agreement to Space 13 Florida which includes a binding commitment to 14 complete an advanced clean energy research and 15 development project; providing that only one business 16 may receive the tax credit; specifying requirements 17 for the application to Space Florida; providing for 18 Space Florida to issue an order certifying that the 19 business is qualified to receive the tax credit; 20 specifying requirements that an application must 21 satisfy in order to qualify to enter into an agreement 22 with Space Florida to establish an advanced clean 23 energy research and development project; authorizing 24 the Department of Revenue to conduct reviews and 25 investigations to verify the proper application of 26 credits taken in a tax return; authorizing Space 27 Florida to order the forfeiture of all or part of any 28 previously claimed tax credits or credits available to 29 be taken under certain circumstances; requiring Space 30 Florida to notify the Department of Revenue of any 31 order affecting a previously authorized tax credit; 32 authorizing the Department of Revenue to issue a 33 notice of deficiency to the certified business under 34 certain circumstances; authorizing the Department of 35 Revenue and Space Florida to adopt rules relating to 36 the tax credit; providing an effective date. 37 38 Be It Enacted by the Legislature of the State of Florida: 39 40 Section 1. Section 220.194, Florida Statutes, is created to 41 read: 42 220.194 Advanced clean energy development tax credit.— 43 (1) DEFINITIONS.—As used in this section, the term: 44 (a) “Advanced clean energy research and development” means 45 the investigation of the latest processes and technologies 46 designed to improve efficiency, reduce cost, and limit emissions 47 from gas turbines during the production of energy. 48 (b) “Advanced clean energy research and development 49 project” or “the project” means the combination of facilities, 50 equipment, technology, personnel, and partnerships brought 51 together to conduct advanced clean energy research and 52 development so as to qualify a business to claim the tax credit 53 provided under this section. A facility consists of a single 54 building or structure, or a group of buildings or structures, 55 which are under common ownership or control and located within 56 the territory of the John F. Kennedy Space Center. 57 (c) “Business” has the same meaning as provided in s. 58 220.03. The term also includes an affiliated group of 59 corporations that file a consolidated return in this state. 60 (d) “Space Florida” means the entity created under s. 61 331.302 to foster the growth and development of a sustainable 62 and world-leading aerospace industry in this state. 63 (2) TAX CREDIT.— 64 (a) A business that is approved by Space Florida to receive 65 the advanced clean energy tax credit pursuant to this section 66 may apply the credit against the tax imposed by this chapter. 67 (b) The credit consists of three components. 68 1. Upon approval of an application and the execution of a 69 written agreement with Space Florida, including a binding 70 commitment to complete an advanced clean energy research and 71 development project, the certified business is awarded a credit 72 in the amount of $3 million annually which may be claimed 73 beginning with the corporate tax year of the business in which 74 the agreement is executed and ending in the 8th corporate tax 75 year thereafter, for a total credit amount of $27 million. 76 2. During the tax year of the business in which the 77 application for the project is approved and the written 78 agreement with Space Florida is executed, the business may claim 79 a tax credit in the amount of $3 million. 80 3. During the tax year of the business in which 81 construction begins on the facility for the project within the 82 territory of the John F. Kennedy Space Center, the business may 83 claim a tax credit in the amount of $3 million. 84 (c) The maximum tax credit amount that may be claimed by 85 the approved business during any tax year is $6 million. If the 86 business does not claim all of the credits for which it is 87 eligible in any tax year, the unused amount may be carried 88 forward for a period not to exceed 10 years following the date 89 that the credit became available to be claimed, after which time 90 the credit amount expires and may not be used. The business may 91 claim the carryover credit in a subsequent year when the tax 92 imposed by this chapter exceeds the credit for such year after 93 applying any other credits and unused credit carryovers listed 94 in s. 220.02(8). 95 (d) A business that files a consolidated return in this 96 state as a member of an affiliated group pursuant to s. 97 220.131(1) may claim the credit on a consolidated return basis 98 up to the amount of tax imposed on the consolidated group. 99 (3) APPLICATION PROCESS.—A business seeking to be eligible 100 for the tax credit under this section must submit an application 101 to Space Florida by the date established by Space Florida, which 102 may not be later than September 1, 2010. Space Florida shall 103 make application forms and guidelines available to applicants by 104 August 1, 2010. 105 (a) Space Florida shall review applications in the order 106 applications are received to determine whether an applicant is 107 qualified to receive the credit and shall approve a qualifying 108 application within 15 days after receipt. By December 1, 2010, 109 the qualified applicant must execute and deliver a written 110 agreement to Space Florida which includes a binding commitment 111 to complete an advanced clean energy research and development 112 project consistent with the requirements of this section. A 113 business may submit only one complete application. Space Florida 114 may not accept an incomplete or placeholder application. Space 115 Florida may certify only one applicant as eligible for the tax 116 credits under this section. 117 (b) An application must contain: 118 1. Documentation determined necessary by the applicant or 119 Space Florida demonstrating the applicant’s ability to meet the 120 requirements of paragraph (4)(b); 121 2. Any other information or documentation prescribed by 122 Space Florida affirmatively demonstrating that the applicant 123 qualifies for the credit; and 124 3. An affidavit certifying that the information contained 125 in the application is correct. 126 (c) Upon execution of the agreement, Space Florida shall 127 issue an order to the qualified applicant and the Department of 128 Revenue certifying that the applicant is qualified for the tax 129 credits under this section. Thereafter, Space Florida shall 130 issue an annual recertification order to the business and the 131 Department of Revenue. The certified business must attach Space 132 Florida’s most recent order to the tax return on which the 133 credit is claimed. 134 (d) Upon execution of the agreement and for each year 135 during which the business claims a credit on a return, the 136 business shall submit documentation required by Space Florida 137 demonstrating activity consistent with the representations in 138 the application and the requirements set forth in paragraph 139 (4)(b). The documentation must include an affidavit certifying 140 that the documentation submitted is correct. 141 (e) Space Florida shall ensure that the amount of corporate 142 income tax credits granted in this section does not exceed the 143 limits provided in this section. 144 (4) ELIGIBILITY REQUIREMENTS.— 145 (a) The credit authorized by this section is reserved for a 146 business that creates an advanced clean energy research and 147 development project, has entered into a written agreement with 148 Space Florida, and is certified to be eligible for tax credits 149 by Space Florida. 150 (b) Space Florida may not certify a business as eligible to 151 receive a tax credit under this section unless it determines 152 that the business’s application affirmatively demonstrates that 153 the applicant agrees: 154 1. To incur a liability of at least $50 million to plan, 155 design, and construct the advanced clean energy research 156 facility. 157 2. To invest at least $20 million on the facility by 2014. 158 This investment includes the hard and soft costs customarily 159 associated with the use or acquisition of a site, site design 160 and preparation and improvements to identified real property 161 located within the territory of the John F. Kennedy Space 162 Center, as well as the customary hard and soft costs associated 163 with the lease or purchase of depreciable machinery and 164 equipment, including attendant design services that are directly 165 related to the project. 166 3. That expenditures for the project will be allotted to 167 Florida vendors whenever feasible. 168 4. To enter into a sponsored research and development 169 agreement for the term of the project which qualifies for 170 certification pursuant to s. 220.15(2)(c). 171 5. That new full-time equivalent employees hired to work on 172 the project will receive a median hourly wage that is at least 173 200 percent of the federal minimum wage. 174 (5) ADMINISTRATION; AUDIT AUTHORITY; RECAPTURE OF CREDITS.— 175 (a) In addition to its existing audit authority, the 176 Department of Revenue may perform any financial or technical 177 review or investigation, including examining the accounts, 178 books, and records of the business, which is necessary to verify 179 the proper application of credits taken in a tax return and to 180 ensure compliance with this chapter. 181 (b) Space Florida may, by order, revoke or modify its order 182 certifying a business as eligible for a tax credit under this 183 section, and may also order the forfeiture of all or part of any 184 previously claimed tax credits or credits available to be taken 185 if, as the result of an audit, investigation, or examination, it 186 is proven that information provided by the business in the 187 application, or in a statement, representation, record, report, 188 plan, or other document provided to Space Florida in an attempt 189 to receive tax credits under this section, was false in a 190 material respect at the time it was submitted and that a person 191 acting on behalf of the business knew, or should have known, 192 that the information submitted was false. 193 (c) Space Florida may, by order, revoke or modify its order 194 certifying a business as eligible for a tax credit under this 195 section, and may also order the forfeiture of previously claimed 196 tax credits or credits available to be taken, if Space Florida 197 determines that the business has not incurred liabilities in the 198 amounts or within the period specified in paragraph (4)(b). If 199 actual expenditures are not made in the amounts or in the period 200 specified in paragraph (4)(b), Space Florida may allow the 201 business to provide adequate assurance that qualifying 202 expenditures will be made within a reasonable time. Such 203 adequate assurances require the business to provide proof of 204 financial security to ensure repayment of any previously claimed 205 tax credit. Until the qualifying expenditures are made, the 206 business may not claim any tax credits under this section. The 207 amount of any tax credits forfeited under this paragraph shall 208 be an amount equal to such proportion as the required investment 209 bears to the actual investment. 210 (d) Space Florida must immediately notify the Department of 211 Revenue of any order affecting a previously authorized tax 212 credit. A business that is liable for unpaid taxes shall file 213 with the Department of Revenue an amended return or such other 214 report as the Department of Revenue prescribes by rule. The 215 business shall pay any required tax and interest within 60 days 216 after Space Florida notifies the business that previously 217 approved credits have been forfeited or modified. If the 218 forfeiture or modification order is contested, the business 219 shall file an amended return or other report within 30 days 220 after the order revoking or forfeiting tax credits becomes 221 final. A business that is liable for taxes avoided must pay the 222 tax due plus interest at the rate established under s. 220.807, 223 computed from the date that tax would have been due if the 224 credit had not been taken. The taxes and interest are due at the 225 time the amended return is filed. A business that fails to pay 226 the taxes and interest by the due date is subject to the 227 penalties provided in s. 220.803. 228 (e) The department may issue a notice of deficiency at any 229 time within 3 years after the business claims a credit or 230 receives a final order from Space Florida that previously 231 approved tax credits have been revoked or modified. 232 (6) RULES.—Space Florida and the department may adopt rules 233 to administer this section, including rules relating to: 234 (a) The forms and procedures required to apply for the 235 credit and to review applications. 236 (b) The forms required to claim a tax credit under this 237 section, the requirements and basis for establishing an 238 entitlement to a credit, and examination and audit procedures 239 required to administer this section. 240 Section 2. This act shall take effect July 1, 2010.