CS/CS/HB 879

A bill to be entitled
2An act relating to targeted economic development; amending
3s. 220.191, F.S.; providing that a capital investment tax
4credit may be carried forward for use against the
5corporate income tax in specified years after the
6commencement of operations of a project; amending s.
7288.106, F.S.; redefining the term "target industry
8business" to revise the eligibility criteria for the tax
9refund program for target industry businesses; requiring
10certain local governing boards to notify the Office of
11Tourism, Trade, and Economic Development and Enterprise
12Florida, Inc., of the average private-sector wage
13calculation to be used for purposes of a business's wage
14commitment under the tax refund program; authorizing a
15reduction in the local financial support requirements for
16qualified target industry businesses located in specified
17counties under certain circumstances; providing for future
18expiration; amending s. 377.809, F.S.; deleting an
19obsolete provision; revising the date by which the
20Department of Community Affairs must submit a report to
21the Governor and Legislature which evaluates the success
22of the Energy Economic Zone Pilot Program; requiring that
23all incentives and benefits provided for enterprise zones
24be made available to energy economic zones by a specified
25date; assigning duties for the administration of energy
26economic zones to the local governing bodies that have
27jurisdiction over such zones; providing for boundaries of
28the zones, eligibility criteria for the incentives, and
29benefits provided in the zones; specifying the incentives
30and benefits available in the zones; requiring that the
31applicable requirements for employee residency for higher
32refund or credit thresholds be based on employee residency
33in the energy economic zone or an enterprise zone;
34establishing priorities for funding certain projects;
35limiting the annual amount of such incentives; authorizing
36the carryforward of any unused amount of incentives for a
37specified period; providing for the issuance of
38certificates to eligible businesses; requiring the local
39governing body to certify to the Department of Revenue or
40the Office of Tourism, Trade, and Economic Development
41which businesses or properties are eligible for the
42incentives; requiring the Department of Revenue to send
43written instructions to eligible businesses on claiming
44the credit on a sales and use tax return initiated through
45an electronic data interchange; authorizing the Office of
46Tourism, Trade, and Economic Development and the
47Department of Revenue to adopt emergency rules; providing
48for renewal of the rules; amending s. 380.06, F.S.;
49exempting certain developments in an energy economic zone
50from review as a development of regional impact; providing
51an effective date.
53Be It Enacted by the Legislature of the State of Florida:
55     Section 1.  Paragraph (d) is added to subsection (2) of
56section 220.191, Florida Statutes, to read:
57     220.191  Capital investment tax credit.-
58     (2)
59     (d)  If the credit granted under subparagraph (a)1. is not
60fully used in any one year because of insufficient tax liability
61on the part of the qualifying business, the unused amounts may
62be used in any one year or years beginning with the 21st year
63after the commencement of operations of the project and ending
64the 30th year after the commencement of operations of the
66     Section 2.  Paragraph (t) of subsection (2) and paragraph
67(b) of subsection (4) of section 288.106, Florida Statutes, are
68amended, present paragraph (f) of subsection (4) is redesignated
69as paragraph (g), and a new paragraph (f) is added to that
70subsection, to read:
71     288.106  Tax refund program for qualified target industry
73     (2)  DEFINITIONS.-As used in this section:
74     (t)  "Target industry business" means a corporate
75headquarters business or any business that is engaged in one of
76the target industries identified pursuant to the following
77criteria developed by the office in consultation with Enterprise
78Florida, Inc.:
79     1.  Future growth.-Industry forecasts should indicate
80strong expectation for future growth in both employment and
81output, according to the most recent available data. Special
82consideration should be given to businesses that export goods
83to, or provide services in, international markets and businesses
84that replace domestic and international imports of goods or
86     2.  Stability.-The industry should not be subject to
87periodic layoffs, whether due to seasonality or sensitivity to
88volatile economic variables such as weather. The industry should
89also be relatively resistant to recession, so that the demand
90for products of this industry is not typically subject to
91decline during an economic downturn.
92     3.  High wage.-The industry should pay relatively high
93wages compared to statewide or area averages.
94     4.  Market and resource independent.-The location of
95industry businesses should not be dependent on Florida markets
96or resources as indicated by industry analysis, except for
97businesses in the renewable energy industry.
98     5.  Industrial base diversification and strengthening.-The
99industry should contribute toward expanding or diversifying the
100state's or area's economic base, as indicated by analysis of
101employment and output shares compared to national and regional
102trends. Special consideration should be given to industries that
103strengthen regional economies by adding value to basic products
104or building regional industrial clusters as indicated by
105industry analysis. Special consideration should also be given to
106the development of strong industrial clusters that include
107defense and homeland security businesses.
108     6.  Positive economic impact benefits.-The industry is
109expected to have strong positive impacts on or benefits to the
110state or regional economies. Special consideration should be
111given to industries that facilitate the development of the state
112as a hub for domestic and global trade and logistics.
114The term does not include any business engaged in retail
115industry activities; any electrical utility company; any
116phosphate or other solid minerals severance, mining, or
117processing operation; any oil or gas exploration or production
118operation; or any business subject to regulation by the Division
119of Hotels and Restaurants of the Department of Business and
120Professional Regulation. Any business within NAICS code 5611 or
1215614, office administrative services and business support
122services, respectively, may be considered a target industry
123business only after the local governing body and Enterprise
124Florida, Inc., make a determination that the community where the
125business may locate has conditions affecting the fiscal and
126economic viability of the local community or area, including but
127not limited to, factors such as low per capita income, high
128unemployment, high underemployment, and a lack of year-round
129stable employment opportunities, and such conditions may be
130improved by the location of such a business to the community. By
131January 1 of every 3rd year, beginning January 1, 2011, the
132office, in consultation with Enterprise Florida, Inc., economic
133development organizations, the State University System, local
134governments, employee and employer organizations, market
135analysts, and economists, shall review and, as appropriate,
136revise the list of such target industries and submit the list to
137the Governor, the President of the Senate, and the Speaker of
138the House of Representatives.
140     (b)  To qualify for review by the office, the application
141of a target industry business must, at a minimum, establish the
142following to the satisfaction of the office:
143     1.a.  The jobs proposed to be created under the
144application, pursuant to subparagraph (a)4., must pay an
145estimated annual average wage equaling at least 115 percent of
146the average private sector wage in the area where the business
147is to be located or the statewide private sector average wage.
148The governing board of the local governmental entity providing
149the local financial support county where the qualified target
150industry business is to be located shall notify the office and
151Enterprise Florida, Inc., which calculation of the average
152private sector wage in the area must be used as the basis for
153the business's wage commitment. In determining the average
154annual wage, the office shall include only new proposed jobs,
155and wages for existing jobs shall be excluded from this
157     b.  The office may waive the average wage requirement at
158the request of the local governing body recommending the project
159and Enterprise Florida, Inc. The office may waive the wage
160requirement for a project located in a brownfield area
161designated under s. 376.80, in a rural city, in a rural
162community, in an enterprise zone, or for a manufacturing project
163at any location in the state if the jobs proposed to be created
164pay an estimated annual average wage equaling at least 100
165percent of the average private sector wage in the area where the
166business is to be located, only if the merits of the individual
167project or the specific circumstances in the community in
168relationship to the project warrant such action. If the local
169governing body and Enterprise Florida, Inc., make such a
170recommendation, it must be transmitted in writing, and the
171specific justification for the waiver recommendation must be
172explained. If the office elects to waive the wage requirement,
173the waiver must be stated in writing, and the reasons for
174granting the waiver must be explained.
175     2.  The target industry business's project must result in
176the creation of at least 10 jobs at the project and, in the case
177of an expansion of an existing business, must result in a net
178increase in employment of at least 10 percent at the business.
179At the request of the local governing body recommending the
180project and Enterprise Florida, Inc., the office may waive this
181requirement for a business in a rural community or enterprise
182zone if the merits of the individual project or the specific
183circumstances in the community in relationship to the project
184warrant such action. If the local governing body and Enterprise
185Florida, Inc., make such a request, the request must be
186transmitted in writing, and the specific justification for the
187request must be explained. If the office elects to grant the
188request, the grant must be stated in writing, and the reason for
189granting the request must be explained.
190     3.  The business activity or product for the applicant's
191project must be within an industry identified by the office as a
192target industry business that contributes to the economic growth
193of the state and the area in which the business is located, that
194produces a higher standard of living for residents of this state
195in the new global economy, or that can be shown to make an
196equivalent contribution to the area's and state's economic
198     (f)  Effective July 1, 2011, notwithstanding paragraph
199(2)(k), the office may reduce the local financial support
200requirements of this section by one-half for a qualified target
201industry business located in Bay, Escambia, Franklin, Gadsden,
202Gulf, Jefferson, Leon, Okaloosa, Santa Rosa, Wakulla, or Walton
203County, if the office determines that such reduction of the
204local financial support requirements is in the best interest of
205the state and facilitates economic development, growth, or new
206employment opportunities in such county. This paragraph expires
207June 30, 2014.
208     Section 3.  Subsection (4) of section 377.809, Florida
209Statutes, is amended, and subsection (5) is added to that
210section, to read:
211     377.809  Energy Economic Zone Pilot Program.-
212     (4)  If the pilot project is ongoing, The Department of
213Community Affairs, with the assistance of the Office of Tourism,
214Trade, and Economic Development, shall submit a report to the
215Governor, the President of the Senate, and the Speaker of the
216House of Representatives by February 15, 2015 2012, evaluating
217whether the pilot program has demonstrated success. The report
218shall contain recommendations with regard to whether the program
219should be expanded for use by other local governments and
220whether state policies should be revised to encourage the goals
221of the program.
222     (5)(a)  Beginning July 1, 2012, all the incentives and
223benefits provided for enterprise zones pursuant to state law
224shall be available to the energy economic zones designated
225pursuant to this section on or before July 1, 2010. In order to
226provide incentives, by March 1, 2012, each local governing body
227that has jurisdiction over an energy economic zone must, by
228local ordinance, establish the boundary of the energy economic
229zone, specify applicable energy-efficiency standards, and
230determine eligibility criteria for the application of state and
231local incentives and benefits in the energy economic zone.
232However, in order to receive benefits provided under s. 288.106,
233a business must be a qualified target industry business under s.
234288.106 for state purposes. An energy economic zone's boundary
235may be revised by local ordinance. Such incentives and benefits
236include those in ss. 212.08, 212.096, 220.181, 220.182, 220.183,
237288.106, and 624.5105 and the public utility discounts provided
238in s. 290.007(8). The exemption provided in s. 212.08(5)(c)
239shall be for renewable energy as defined in s. 377.803. For
240purposes of this section, any applicable requirements for
241employee residency for higher refund or credit thresholds must
242be based on employee residency in the energy economic zone or an
243enterprise zone. A business in an energy economic zone may also
244be eligible for funding under ss. 288.047 and 445.003, and a
245transportation project in an energy economic zone shall be
246provided priority in funding under s. 288.063. Other projects
247shall be given priority ranking to the extent practicable for
248grants administered under state energy programs.
249     (b)  Effective July 1, 2012, the total amount of state
250credits, refunds, and exemptions that may be provided by the
251governing body of each energy economic zone to eligible
252businesses for energy-economic-zone incentives pursuant to
253paragraph (a) is $300,000 per designated energy economic zone in
254any state fiscal year. The governing body of an energy economic
255zone shall disallow a credit or refund for which an application
256is submitted after the zone's respective $300,000 limit is
257reached. If the $300,000 incentive cap is not fully used in any
258one state fiscal year by an energy economic zone, the unused
259amount under the cap may be carried forward for up to 5 years.
260The local governing body that has jurisdiction over the energy
261economic zone is responsible for allocating the incentives, for
262verifying that businesses receiving such incentives are eligible
263for the incentives provided, and for ensuring that the
264incentives provided do not exceed the cap for the state fiscal
266     (c)  Upon approving an incentive for an eligible business,
267the governing body that has jurisdiction over the energy
268economic zone shall provide the taxpayer with a certificate
269indicating the name and federal identification number of the
270eligible business, the date the incentive is provided, the name
271of the energy economic zone, the incentive type, and the
272incentive amount. The local governing body shall certify to the
273Department of Revenue or the Office of Tourism, Trade, and
274Economic Development, whichever is applicable, which businesses
275or properties are eligible to receive any or all of the state
276incentives according to their statutory requirements. The
277governing body that has jurisdiction over the energy economic
278zone shall provide a copy of the certificate to the Department
279of Revenue and the Office of Tourism, Trade, and Economic
280Development as notification that such incentives were approved
281for the specific eligible business or property. For incentives
282to be claimed against the sales and use tax under chapter 212,
283the Department of Revenue shall send, within 14 days after
284receipt, written instructions to an eligible business on how to
285claim the credit on a sales and use tax return initiated through
286an electronic data interchange. Any credit against the sales and
287use tax shall be deducted from any sales and use tax remitted by
288the dealer to the Department of Revenue by electronic funds
289transfer and may be deducted only on a sales and use tax return
290initiated through an electronic data interchange. The dealer
291shall separately state the credit on the electronic return. The
292net amount of tax due and payable must be remitted by electronic
293funds transfer. If the credit exceeds the amount owed on the
294sales and use tax return, such excess amount may be carried
295forward for a period not to exceed 12 months after the date that
296the credit is initially claimed.
297     (d)  If all conditions are deemed met, the Office of
298Tourism, Trade, and Economic Development and the Department of
299Revenue may adopt emergency rules pursuant to ss. 120.536(1) and
300120.54 to administer the provisions of this subsection. The
301emergency rules shall remain in effect for 6 months after the
302rules are adopted, and the rules may be renewed while the
303procedures to adopt permanent rules addressing the subject of
304the emergency rules are pending.
305     Section 4.  Paragraph (u) is added to subsection (24) of
306section 380.06, Florida Statutes, to read:
307     380.06  Developments of regional impact.-
309     (u)  Any development in an energy economic zone designated
310pursuant to s. 377.809 is exempt from this section upon approval
311by its local governing body.
313If a use is exempt from review as a development of regional
314impact under paragraphs (a)-(s), but will be part of a larger
315project that is subject to review as a development of regional
316impact, the impact of the exempt use must be included in the
317review of the larger project, unless such exempt use involves a
318development of regional impact that includes a landowner,
319tenant, or user that has entered into a funding agreement with
320the Office of Tourism, Trade, and Economic Development under the
321Innovation Incentive Program and the agreement contemplates a
322state award of at least $50 million.
323     Section 5.  This act shall take effect July 1, 2011.

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