Florida Senate - 2011 CS for SB 506
By the Committee on Community Affairs; and Senator Bogdanoff
578-01986-11 2011506c1
1 A bill to be entitled
2 An act relating to economic development; amending s.
3 196.012, F.S.; revising the definitions of the terms
4 “new business” and “expansion of an existing
5 business”; amending s. 196.1995, F.S.; authorizing the
6 board of county commissioners of a charter county to
7 call and hold a referendum to determine whether to
8 grant economic development ad valorem tax exemptions;
9 revising the language of ballot questions relating to
10 the authority to grant economic development tax
11 exemptions; providing for application of a provision
12 limiting the calling of another referendum within a
13 certain time period; specifying additional information
14 that must be included in a written application
15 requesting adoption of an ordinance granting an
16 economic development ad valorem tax exemption;
17 specifying factors for a board of county commissioners
18 or governing authority of a municipality to consider
19 when deciding whether to approve or reject
20 applications for economic development tax exemptions;
21 providing legislative intent; limiting the allowable
22 duration of an economic development tax exemption
23 granted by a county or municipal ordinance;
24 authorizing written tax exemption agreements
25 consistent with the act upon approval of a tax
26 exemption application; specifying that the written tax
27 agreement must require the applicant to report certain
28 information at a specific time before expiration of
29 the exemption; authorizing the board of county
30 commissioners or the governing authority of the
31 municipality to revoke, in whole or in part, the
32 exemption under certain circumstances; providing an
33 effective date.
34
35 Be It Enacted by the Legislature of the State of Florida:
36
37 Section 1. Subsections (15) and (16) of section 196.012,
38 Florida Statutes, are amended to read:
39 196.012 Definitions.—For the purpose of this chapter, the
40 following terms are defined as follows, except where the context
41 clearly indicates otherwise:
42 (15) “New business” means:
43 (a)1. A business or nonprofit organization starting
44 operations in the state which will create new, full-time jobs
45 that the board of county commissioners or the governing
46 authority of a municipality has determined are jobs for which
47 the board or governing authority wishes to provide incentives
48 through ad valorem tax exemptions granted in accordance with the
49 requirements of s. 196.1995; establishing 10 or more jobs to
50 employ 10 or more full-time employees in this state, which
51 manufactures, processes, compounds, fabricates, or produces for
52 sale items of tangible personal property at a fixed location and
53 which comprises an industrial or manufacturing plant;
54 2. A business establishing 25 or more jobs to employ 25 or
55 more full-time employees in this state, the sales factor of
56 which, as defined by s. 220.15(5), for the facility with respect
57 to which it requests an economic development ad valorem tax
58 exemption is less than 0.50 for each year the exemption is
59 claimed; or
60 3. An office space in this state owned and used by a
61 corporation newly domiciled in this state; provided such office
62 space houses 50 or more full-time employees of such corporation;
63 provided that such business or office first begins operation on
64 a site clearly separate from any other commercial or industrial
65 operation owned by the same business.
66 (b) Any business located in an enterprise zone or
67 brownfield area that first begins operation on a site clearly
68 separate from any other commercial or industrial operation owned
69 by the same business; or.
70 (c) A business that is situated on property annexed into a
71 municipality and that, at the time of the annexation, is
72 receiving an economic development ad valorem tax exemption from
73 the county under s. 196.1995.
74 (16) “Expansion of an existing business” means:
75 (a) The expansion of an existing business or nonprofit
76 organization, other than its relocation to another community,
77 which results in a net increase of new, full-time jobs for which
78 the board or governing authority wishes to provide incentives
79 through ad valorem tax exemptions granted pursuant to s.
80 196.1995; or
81 1. A business establishing 10 or more jobs to employ 10 or
82 more full-time employees in this state, which manufactures,
83 processes, compounds, fabricates, or produces for sale items of
84 tangible personal property at a fixed location and which
85 comprises an industrial or manufacturing plant; or
86 2. A business establishing 25 or more jobs to employ 25 or
87 more full-time employees in this state, the sales factor of
88 which, as defined by s. 220.15(5), for the facility with respect
89 to which it requests an economic development ad valorem tax
90 exemption is less than 0.50 for each year the exemption is
91 claimed; provided that such business increases operations on a
92 site colocated with a commercial or industrial operation owned
93 by the same business, resulting in a net increase in employment
94 of not less than 10 percent or an increase in productive output
95 of not less than 10 percent.
96 (b) Any business located in an enterprise zone or
97 brownfield area that increases operations on a site colocated
98 with a commercial or industrial operation owned by the same
99 business.
100 Section 2. Section 196.1995, Florida Statutes, is amended
101 to read:
102 196.1995 Economic development ad valorem tax exemption.—
103 (1) The board of county commissioners of any county or the
104 governing authority of any municipality shall call a referendum
105 within its total jurisdiction to determine whether its
106 respective jurisdiction may grant economic development ad
107 valorem tax exemptions under s. 3, Art. VII of the State
108 Constitution if:
109 (a) The board of county commissioners of the county or the
110 governing authority of the municipality votes to hold such
111 referendum; or
112 (b) The board of county commissioners of the county or the
113 governing authority of the municipality receives a petition
114 signed by 10 percent of the registered electors of its
115 respective jurisdiction, which petition calls for the holding of
116 such referendum; or
117 (c) The board of county commissioners of a charter county
118 receives a petition or initiative signed by the required
119 percentage of registered electors in accordance with the
120 procedures established in the county’s charter for the enactment
121 of ordinances or for approval of amendments of the charter,
122 including a county with a charter requiring signatures from less
123 than 10 percent of its registered electors, which petition or
124 initiative calls for the holding of such referendum.
125 (2) The ballot question in such referendum shall be in
126 substantially the following form:
127
128 Shall the board of county commissioners of this county (or the
129 governing authority of this municipality, or both) be authorized
130 to grant, pursuant to s. 3, Art. VII of the State Constitution,
131 property tax exemptions to new businesses and expansions of
132 existing businesses that are expected to create new, full-time
133 jobs and have been evaluated as being of economic interest to
134 the community?
135
136 .... Yes—For authority to grant exemptions.
137 .... No—Against authority to grant exemptions.
138
139 (3) The board of county commissioners or the governing
140 authority of the municipality that calls a referendum within its
141 total jurisdiction to determine whether its respective
142 jurisdiction may grant economic development ad valorem tax
143 exemptions may vote to limit the effect of the referendum to
144 authority to grant economic development tax exemptions for new
145 businesses and expansions of existing businesses located in an
146 enterprise zone or a brownfield area, as defined in s.
147 376.79(4). If an area nominated to be an enterprise zone
148 pursuant to s. 290.0055 has not yet been designated pursuant to
149 s. 290.0065, the board of county commissioners or the governing
150 authority of the municipality may call such referendum prior to
151 such designation; however, the authority to grant economic
152 development ad valorem tax exemptions does not apply until such
153 area is designated pursuant to s. 290.0065. The ballot question
154 in such referendum shall be in substantially the following form
155 and shall be used in lieu of the ballot question prescribed in
156 subsection (2):
157
158 Shall the board of county commissioners of this county (or the
159 governing authority of this municipality, or both) be authorized
160 to grant, pursuant to s. 3, Art. VII of the State Constitution,
161 property tax exemptions for new businesses and expansions of
162 existing businesses that which are located in an enterprise zone
163 or a brownfield area, are expected to create new, full-time
164 jobs, and have been evaluated as being of economic interest to
165 the community?
166
167 .... Yes—For authority to grant exemptions.
168 .... No—Against authority to grant exemptions.
169
170 (4) A referendum pursuant to this section may be called
171 only once in any 12-month period. If a referendum is called or
172 held on or before the effective date of any amendment to this
173 section, the board of county commissioners does not need to call
174 or hold another referendum.
175 (5) Upon a majority vote in favor of such authority, the
176 board of county commissioners or the governing authority of the
177 municipality, at its discretion, by ordinance may exempt from ad
178 valorem taxation up to 100 percent of the assessed value of all
179 improvements to real property made by or for the use of a new
180 business and of all tangible personal property of such new
181 business, or up to 100 percent of the assessed value of all
182 added improvements to real property made to facilitate the
183 expansion of an existing business and of the net increase in all
184 tangible personal property acquired to facilitate such expansion
185 of an existing business, provided that the improvements to real
186 property are made or the tangible personal property is added or
187 increased on or after the day the ordinance is adopted. However,
188 if the authority to grant exemptions is approved in a referendum
189 in which the ballot question contained in subsection (3) appears
190 on the ballot, the authority of the board of county
191 commissioners or the governing authority of the municipality to
192 grant exemptions is limited solely to new businesses and
193 expansions of existing businesses that are located in an
194 enterprise zone or brownfield area. Property acquired to replace
195 existing property shall not be considered to facilitate a
196 business expansion. The exemption applies only to taxes levied
197 by the respective unit of government granting the exemption. The
198 exemption does not apply, however, to taxes levied for the
199 payment of bonds or to taxes authorized by a vote of the
200 electors pursuant to s. 9(b) or s. 12, Art. VII of the State
201 Constitution. Any such exemption shall remain in effect for up
202 to 10 years with respect to any particular facility, regardless
203 of any change in the authority of the county or municipality to
204 grant such exemptions. The exemption shall not be prolonged or
205 extended by granting exemptions from additional taxes or by
206 virtue of any reorganization or sale of the business receiving
207 the exemption.
208 (6) With respect to a new business as defined by s.
209 196.012(15)(b)(c), the municipality annexing the property on
210 which the business is situated may grant an economic development
211 ad valorem tax exemption under this section to that business for
212 a period that will expire upon the expiration of the exemption
213 granted by the county. If the county renews the exemption under
214 subsection (7), the municipality may also extend its exemption.
215 A municipal economic development ad valorem tax exemption
216 granted under this subsection may not extend beyond the duration
217 of the county exemption.
218 (7) The authority to grant exemptions under this section
219 expires 10 years after the date such authority was approved in
220 an election, but such authority may be renewed for subsequent
221 10-year periods if each 10-year renewal is approved in a
222 referendum called and held pursuant to this section.
223 (8) Any person, firm, or corporation which desires an
224 economic development ad valorem tax exemption shall, in the year
225 the exemption is desired to take effect, file a written
226 application on a form prescribed by the department with the
227 board of county commissioners or the governing authority of the
228 municipality, or both. The application shall request the
229 adoption of an ordinance granting the applicant an exemption
230 pursuant to this section and shall include the following
231 information:
232 (a) The name and location of the new business or the
233 expansion of an existing business;
234 (b) A description of the improvements to real property for
235 which an exemption is requested and the date of commencement of
236 construction of such improvements;
237 (c) A description of the tangible personal property for
238 which an exemption is requested and the dates when such property
239 was or is to be purchased;
240 (d) Proof, to the satisfaction of the board of county
241 commissioners or the governing authority of the municipality,
242 that the applicant is a new business or an expansion of an
243 existing business, as defined in s. 196.012(15) or (16);
244 (e) The number of jobs the applicant expects to create
245 along with the average and median wage of the jobs and whether
246 the jobs are full-time or part-time;
247 (f) The expected time schedule for job creation; and
248 (g)(e) Other information deemed necessary by the
249 department.
250 (9) Before it takes action on the application, the board of
251 county commissioners or the governing authority of the
252 municipality shall deliver a copy of the application to the
253 property appraiser of the county. After careful consideration,
254 the property appraiser shall report the following information to
255 the board of county commissioners or the governing authority of
256 the municipality:
257 (a) The total revenue available to the county or
258 municipality for the current fiscal year from ad valorem tax
259 sources, or an estimate of such revenue if the actual total
260 revenue available cannot be determined;
261 (b) Any revenue lost to the county or municipality for the
262 current fiscal year by virtue of exemptions previously granted
263 under this section, or an estimate of such revenue if the actual
264 revenue lost cannot be determined;
265 (c) An estimate of the revenue which would be lost to the
266 county or municipality during the current fiscal year if the
267 exemption applied for were granted had the property for which
268 the exemption is requested otherwise been subject to taxation;
269 and
270 (d) A determination as to whether the property for which an
271 exemption is requested is to be incorporated into a new business
272 or the expansion of an existing business, as defined in s.
273 196.012(15) or (16), or into neither, which determination the
274 property appraiser shall also affix to the face of the
275 application. Upon the request of the property appraiser, the
276 department shall provide to him or her such information as it
277 may have available to assist in making such determination.
278 (10) The board of county commissioners or the governing
279 authority of the municipality may consider any economically
280 related characteristics or criteria deemed necessary or
281 appropriate when exercising its discretion whether to approve or
282 reject an application for an exemption but, at a minimum, must
283 consider the following:
284 (a) Total number of new jobs to be created by the
285 applicant.
286 (b) Average wage and median wage of the new jobs.
287 (c) Capital investment to be made by the applicant.
288 (d) Whether the business or operation qualifies as an
289 industry that the board of county commissioners or the governing
290 authority of the municipality may target.
291 (e) Environmental impact of the proposed business or
292 operation.
293 (f) Extent to which the applicant intends to source its
294 supplies and materials within the applicable jurisdiction.
295
296 The Legislature intends to vest counties and municipalities with
297 as much discretion as legally permissible to determine which new
298 jobs should be incentivized through the granting of ad valorem
299 tax exemptions under this section.
300 (11)(10) An ordinance granting an exemption under this
301 section shall be adopted in the same manner as any other
302 ordinance of the county or municipality and shall include the
303 following:
304 (a) The name and address of the new business or expansion
305 of an existing business to which the exemption is granted;
306 (b) The total amount of revenue available to the county or
307 municipality from ad valorem tax sources for the current fiscal
308 year, the total amount of revenue lost to the county or
309 municipality for the current fiscal year by virtue of economic
310 development ad valorem tax exemptions currently in effect, and
311 the estimated revenue loss to the county or municipality for the
312 current fiscal year attributable to the exemption of the
313 business named in the ordinance;
314 (c) The period of time, not to exceed 10 years, for which
315 the exemption will remain in effect and the expiration date of
316 the exemption; and
317 (d) A finding that the business named in the ordinance
318 meets the requirements of s. 196.012(15) or (16).
319 (12) Upon approval of an application for a tax exemption
320 under this section, the board of county commissioners or the
321 governing authority of the municipality and the applicant may
322 enter into a written tax exemption agreement, which may include
323 performance criteria and must be consistent with the
324 requirements of this section or other applicable laws. The
325 agreement must require the applicant to report at a specific
326 time before the expiration of the exemption the actual number of
327 new, full-time jobs created and their actual average and median
328 wage. The agreement may provide the board of county
329 commissioners or the governing authority of the municipality
330 with authority to revoke, in whole or in part, the exemption if
331 the applicant fails to meet the expectations and representations
332 described in subsection (8).
333 Section 3. This act shall take effect July 1, 2011.