Florida Senate - 2024 SB 510
By Senator Stewart
17-00220-24 2024510__
1 A bill to be entitled
2 An act relating to an excise tax on water extracted
3 for commercial or industrial use; revising the title
4 of ch. 211, F.S.; creating part III of ch. 211, F.S.,
5 entitled “Tax on Water Extracted for Commercial or
6 Industrial Use”; creating s. 211.40, F.S.; defining
7 terms; creating s. 211.41, F.S.; imposing an excise
8 tax upon persons extracting water from waters of the
9 state for commercial or industrial use; specifying the
10 rate of the tax; requiring tax proceeds to be
11 deposited in a specified trust fund; requiring that
12 tax proceeds be separately accounted for and used for
13 specified purposes by the Department of Environmental
14 Protection; creating s. 211.42, F.S.; specifying
15 requirements for extractors in filing monthly returns
16 with the Department of Revenue; requiring the
17 department to prescribe by rule the form of such
18 returns; providing requirements for the returns;
19 authorizing the department to grant extensions for
20 filing and payment under certain circumstances;
21 creating s. 211.43, F.S.; specifying interest payable
22 on unpaid taxes; specifying the delinquency penalties
23 for failure to timely file a return; specifying the
24 penalty for the substantial underpayment of taxes;
25 providing construction; authorizing the department to
26 settle or compromise taxes or interest in accordance
27 with certain provisions; creating s. 211.44, F.S.;
28 authorizing the department to adopt rules; requiring
29 governmental entities to cooperate with the department
30 and furnish information without cost to the department
31 for certain purposes; specifying recordkeeping
32 requirements for extractors; authorizing the
33 department to inspect or examine an extractor’s books
34 and records and to require testimony under oath or
35 affirmation of certain persons; authorizing the
36 department to issue certain subpoenas; authorizing
37 certain representatives of the department to
38 administer an oath or affirmation; authorizing a
39 circuit court to issue orders of compliance under
40 certain circumstances; requiring books and records to
41 be available for inspection by the department;
42 authorizing the department to inspect or examine an
43 extractor’s books and records, issue subpoenas,
44 require testimony under oath or affirmation of certain
45 persons, and apply for certain judicial orders;
46 specifying requirements and procedures for the
47 department in conducting audits, assessing
48 deficiencies, and crediting or refunding overpayments;
49 specifying procedures and requirements for claiming
50 refunds; providing that amounts due remain a lien on
51 certain property and assets; specifying requirements
52 and procedures for warrants and alias tax executions
53 issued by the department; requiring that suits brought
54 by the department for violations be brought in circuit
55 court; creating s. 211.45, F.S.; providing criminal
56 penalties for certain violations; amending ss. 213.05,
57 213.053, and 403.890, F.S.; conforming provisions to
58 changes made by the act; providing an effective date.
59
60 Be It Enacted by the Legislature of the State of Florida:
61
62 Section 1. Chapter 211, Florida Statutes, entitled “Tax on
63 Production of Oil and Gas and Severance of Solid Minerals,” is
64 retitled “Tax on Production of Oil and Gas, Severance of Solid
65 Minerals, and Water Extracted for Commercial or Industrial Use.”
66 Section 2. The Division of Law Revision is directed to
67 create part III of chapter 211, Florida Statutes, consisting of
68 ss. 211.40-211.45, Florida Statutes, to be entitled “Tax on
69 Water Extracted for Commercial or Industrial Use.”
70 Section 3. Section 211.40, Florida Statutes, is created to
71 read:
72 211.40 Definitions.—As used in this part, the term:
73 (1) “Department” means the Department of Revenue.
74 (2) “Extractor” means a person engaged in the business of
75 extracting water from waters of the state for commercial or
76 industrial use. For purposes of this part, commercial or
77 industrial use does not include water extracted in connection
78 with any of the following:
79 (a) Public water supply utilities.
80 (b) Maintenance of land, crops, or livestock, when
81 extracted by an agricultural producer.
82 (c) Use within any structure for restroom, sanitation, or
83 kitchen facilities.
84 (3) “Waters of the state” has the same meaning as the term
85 “waters” as defined in s. 403.031.
86 Section 4. Section 211.41, Florida Statutes, is created to
87 read:
88 211.41 Excise tax; distribution and use of tax proceeds.—
89 (1) An excise tax is levied upon every person who acts as
90 an extractor at a rate of one one-thousandth of a dollar per
91 gallon of water extracted from waters of the state.
92 (2) The proceeds of the tax imposed by this section must be
93 deposited in the Water Protection and Sustainability Program
94 Trust Fund established under s. 403.891, subject to the
95 requirements of s. 403.890, and must be accounted for separately
96 within the trust fund. In addition to the purposes specified in
97 s. 403.890(1)(a), (b), and (c), such tax proceeds must be used
98 by the Department of Environmental Protection for geological
99 surveys to monitor the health of waters of the state and for
100 saltwater intrusion prevention and management.
101 Section 5. Section 211.42, Florida Statutes, is created to
102 read:
103 211.42 Returns; filing requirements.—
104 (1) Each extractor shall remit tax due and submit to the
105 department a return on or before the 25th day of each month
106 which shows the total amount of water extracted from waters of
107 the state during the previous month, the source and county of
108 extraction, the location of all facilities used in the
109 extraction of taxable water, and other information required by
110 department rule. The department shall prescribe by rule the form
111 of the return. The return must be filed on or before the last
112 day prescribed for payment of the tax and must be signed and
113 verified under oath by the extractor or the extractor’s
114 authorized representative.
115 (a) The return must include a statement of the tax due
116 under this part and such other information as the department may
117 reasonably require.
118 (b) A return must be filed even though no tax is due. Any
119 tax, penalty, or interest due must be remitted with the return.
120 (2) If any due date prescribed by this section falls on a
121 Saturday, Sunday, or state or federal holiday, the last date
122 prescribed for filing or payment is the next day that is not a
123 Saturday, Sunday, or state or federal holiday. The date of
124 receipt by the department, or the postmark date if mailed,
125 determines the timeliness of payment or filing.
126 (3) The department may grant an extension of time for
127 payment or filing of a return upon written request submitted on
128 or before the due date.
129 Section 6. Section 211.43, Florida Statutes, is created to
130 read:
131 211.43 Interest and penalties; failure to pay tax or file
132 return.—
133 (1) If any part of the tax imposed by this part is not paid
134 on or before the due date, interest must be added to the amount
135 due at the rate of 12 percent per year from the due date until
136 the date of payment.
137 (2) An extractor who fails to file the return required
138 under s. 211.42 by the due date must pay a delinquency penalty.
139 If tax is due with the return, the delinquency penalty is 10
140 percent for each month, or portion thereof, of the amount of tax
141 due with the return, not to exceed 50 percent of the tax due. If
142 no tax is due with the return, the delinquency penalty is $50
143 for each month, or portion thereof, during which the return was
144 not filed, not to exceed $300 in aggregate. The amount of tax
145 due with a return must be reduced by amounts properly creditable
146 against the tax liability shown on the return on the date the
147 return was due.
148 (3) An extractor who makes a substantial underpayment of
149 the tax due under this part must pay a penalty of 10 cents per
150 gallon of water extracted for which tax was not paid. For
151 purposes of this subsection, a substantial underpayment of tax
152 is a deficiency of tax in an amount exceeding 35 percent of the
153 total tax due for a month.
154 (4) Any penalty or interest imposed under this section is
155 deemed assessed upon the assessment of the tax and must be
156 collected and paid in the same manner as the tax.
157 (5) The department may settle or compromise any penalty
158 imposed by this section for reasonable cause in accordance with
159 s. 213.21. The department may settle or compromise interest
160 imposed by this section only as authorized by s. 213.21.
161 Section 7. Section 211.44, Florida Statutes, is created to
162 read:
163 211.44 Administration and enforcement; books and records;
164 refunds.—
165 (1) The department may adopt rules to administer this part,
166 including rules necessary to prescribe the form and content of
167 returns and reports.
168 (2) All state, county, and municipal agencies, boards,
169 bureaus, departments, and districts shall cooperate with the
170 department and furnish any information the department deems
171 necessary, without cost to the department, for the purposes of
172 administering, collecting, and enforcing the tax imposed under
173 this part.
174 (3)(a) Each extractor shall maintain suitable books and
175 records relating to the extraction of waters of the state to
176 enable the department to determine the amount of tax due under
177 this part. Such books and records must be preserved until the
178 time has expired during which the department may make an
179 assessment with respect thereto, in accordance with s. 213.35.
180 (b) The department may inspect or examine the books,
181 records, or papers of any extractor which are reasonably
182 required for the purposes of this part and may require the
183 extractor or the extractor’s authorized representative to
184 testify under oath or affirmation or to answer pertinent
185 questions regarding the extractor’s business or extraction of
186 taxable waters of the state.
187 1. The department may issue subpoenas to compel third
188 parties to testify or to produce records or other evidence in
189 their possession.
190 2. Any duly authorized representative of the department may
191 administer an oath or affirmation.
192 3. If any person fails to comply with a request of the
193 department for the inspection of records or with a subpoena or
194 fails to give testimony or respond to pertinent questions, a
195 circuit court having jurisdiction over such person, upon
196 application by the department, may issue orders necessary to
197 secure compliance.
198 (c) All books and records required to be kept under this
199 subsection must be available for inspection by the department
200 upon written request during normal business hours.
201 (4) The department may audit or examine the books and
202 records of an extractor to determine whether returns have been
203 properly filed and tax has been properly paid. An audit may be
204 commenced for any month for which the department is authorized
205 to make an assessment of amounts due under this part. An audit
206 must be commenced by service upon the extractor, either in
207 person or by certified mail, of a written notice of intent to
208 audit. The date of personal contact or the date of the notice
209 governs the period subject to audit. If there is jeopardy to the
210 revenue and jeopardy is asserted in or with an assessment, the
211 department must proceed in the manner specified for jeopardy
212 assessment in s. 213.732.
213 (5)(a) The department may assess, with or without an audit,
214 any deficiency resulting from nonpayment or underpayment of the
215 tax, interest, or penalties imposed by this part. The department
216 shall inform the extractor by written notice of the amount of
217 any deficiency or overpayment revealed by an audit, including
218 the tax, interest, or penalties due, and shall explain the basis
219 for the determination.
220 (b) The department may make an assessment under this part
221 based upon the best information available to it. If an extractor
222 fails to file a return, files a grossly incorrect or fraudulent
223 return, or refuses to allow inspection of records, the
224 department may make an assessment based upon an estimate of
225 amounts due under this part. An assessment of the amounts due
226 under this part is deemed prima facie correct, and the extractor
227 has the burden of showing any error in calculating it.
228 (c) In the event of a deficiency, the department shall
229 issue its written notice to an extractor for the tax, penalties,
230 or interest due. Full payment of the total amount assessed must
231 be made in the manner prescribed by the department in its
232 notice.
233 (6)(a) The department may credit or refund any overpayments
234 of amounts due under this part which are revealed by an audit or
235 for which a timely claim for refund has been properly filed.
236 (b) A claim for refund may be filed within the timeframe
237 specified in s. 215.26(2).
238 (c) A claim for refund must be signed by the extractor or
239 the extractor’s duly authorized representative, successor, or
240 assignee and must include information the department requires to
241 determine the correctness of the claim.
242 (7)(a) Amounts due under this part remain a lien upon the
243 property, assets, and effects of an extractor until paid or
244 until collection thereof is barred under s. 95.091. Amounts due
245 may be recovered by the department, on behalf of the state, by
246 an action in any county where the property, assets, or effects
247 of the extractor are located.
248 (b) When any tax imposed under this part becomes delinquent
249 or is otherwise in jeopardy, the department may issue a warrant
250 for the full amount due or estimated to be due, including the
251 tax, penalties, interest, and costs of collection. The warrant
252 must be directed to each sheriff and may be recorded with the
253 clerk of the circuit court in any county where the extractor’s
254 property is located. Upon recording, the clerk of the circuit
255 court shall execute the warrant in the same manner prescribed by
256 law for executions upon judgments and is entitled to the same
257 fees for this service. Upon payment of the warrant, the
258 department shall satisfy the lien of record within 30 days.
259 Thereafter, any interested person may compel the department to
260 satisfy the lien of record.
261 (c) An alias tax execution may be issued whenever the
262 department deems it necessary. Each alias tax execution must be
263 so designated on its face and has the same force and effect as
264 the original.
265 (d) An alias tax execution may be levied upon any third
266 party that is in possession or control of any assets of a
267 delinquent extractor or that is indebted to a delinquent
268 extractor. Such tax executions have the force and effect of a
269 writ of garnishment. The third party shall pay the debt or
270 deliver the assets of the delinquent extractor to the
271 department, and receipt by the department discharges the third
272 party completely to the extent of the debt paid or assets
273 surrendered to the department.
274 (e) When an alias tax execution becomes void, the
275 department may cancel it of record and must do so upon the
276 request of any interested person.
277 (8) Any employee of the department may be designated by the
278 executive director to make and sign assessments, tax warrants,
279 or satisfactions of tax warrants.
280 (9) Any suit brought by the department against any person
281 for violating this part must be brought in circuit court.
282 Section 8. Section 211.45, Florida Statutes, is created to
283 read:
284 211.45 Criminal penalties.—
285 (1) A person who willfully fails to file a return or keep
286 books or records on the extraction of waters of the state which
287 is taxable under this part, who files a fraudulent return, who
288 willfully fails or refuses to produce books or records, or who
289 willfully violates any provision of this part or any rule
290 adopted by the department under this part commits a misdemeanor
291 of the first degree, punishable as provided in s. 775.082 or s.
292 775.083.
293 (2) A person who withholds tax due under this part and
294 willfully fails to make remittance as required by this part or
295 who purports to make payments due under this part but willfully
296 fails to do so because the remittance fails to clear the bank or
297 depository institution against which it is drawn commits a
298 felony of the third degree, punishable as provided in s.
299 775.082, s. 775.083, or s. 775.084.
300 Section 9. Section 213.05, Florida Statutes, is amended to
301 read:
302 213.05 Department of Revenue; control and administration of
303 revenue laws.—The Department of Revenue shall have only those
304 responsibilities for ad valorem taxation specified to the
305 department in chapter 192, taxation, general provisions; chapter
306 193, assessments; chapter 194, administrative and judicial
307 review of property taxes; chapter 195, property assessment
308 administration and finance; chapter 196, exemption; chapter 197,
309 tax collections, sales, and liens; chapter 199, intangible
310 personal property taxes; and chapter 200, determination of
311 millage. The Department of Revenue shall have the responsibility
312 of regulating, controlling, and administering all revenue laws
313 and performing all duties as provided in s. 125.0104, the Local
314 Option Tourist Development Act; s. 125.0108, tourist impact tax;
315 chapter 198, estate taxes; chapter 201, excise tax on documents;
316 chapter 202, communications services tax; chapter 203, gross
317 receipts taxes; chapter 206, motor and other fuel taxes; chapter
318 211, tax on production of oil and gas, and severance of solid
319 minerals, and water extracted for commercial or industrial use;
320 chapter 212, tax on sales, use, and other transactions; chapter
321 220, income tax code; ss. 336.021 and 336.025, taxes on motor
322 fuel and special fuel; s. 376.11, pollutant spill prevention and
323 control; s. 403.718, waste tire fees; s. 403.7185, lead-acid
324 battery fees; s. 538.09, registration of secondhand dealers; s.
325 538.25, registration of secondary metals recyclers; s. 624.4621,
326 group self-insurer’s fund premium tax; s. 624.5091, retaliatory
327 tax; s. 624.475, commercial self-insurance fund premium tax; ss.
328 624.509-624.511, insurance code: administration and general
329 provisions; s. 624.515, State Fire Marshal regulatory
330 assessment; s. 627.357, medical malpractice self-insurance
331 premium tax; s. 629.5011, reciprocal insurers premium tax; and
332 s. 681.117, motor vehicle warranty enforcement.
333 Section 10. Subsection (1) of section 213.053, Florida
334 Statutes, is amended to read:
335 213.053 Confidentiality and information sharing.—
336 (1) This section applies to all of the following:
337 (a) Section 125.0104, county government.;
338 (b) Section 125.0108, tourist impact tax.;
339 (c) Chapter 175, municipal firefighters’ pension trust
340 funds.;
341 (d) Chapter 185, municipal police officers’ retirement
342 trust funds.;
343 (e) Chapter 198, estate taxes.;
344 (f) Chapter 199, intangible personal property taxes.;
345 (g) Chapter 201, excise tax on documents.;
346 (h) Chapter 202, the Communications Services Tax
347 Simplification Law.;
348 (i) Chapter 203, gross receipts taxes.;
349 (j) Chapter 211, tax on severance and production of
350 minerals and on water extracted for commercial or industrial
351 use.;
352 (k) Chapter 212, tax on sales, use, and other
353 transactions.;
354 (l) Chapter 220, income tax code.;
355 (m) Section 252.372, emergency management, preparedness,
356 and assistance surcharge.;
357 (n) Section 379.362(3), Apalachicola Bay oyster surcharge.;
358 (o) Chapter 376, pollutant spill prevention and control.;
359 (p) Section 403.718, waste tire fees.;
360 (q) Section 403.7185, lead-acid battery fees.;
361 (r) Section 538.09, registration of secondhand dealers.;
362 (s) Section 538.25, registration of secondary metals
363 recyclers.;
364 (t) Sections 624.501 and 624.509-624.515, insurance code.;
365 (u) Section 681.117, motor vehicle warranty enforcement.;
366 and
367 (v) Section 896.102, reports of financial transactions in
368 trade or business.
369 Section 11. Subsection (1) of section 403.890, Florida
370 Statutes, is amended to read:
371 403.890 Water Protection and Sustainability Program.—
372 (1) Revenues deposited into or appropriated to the Water
373 Protection and Sustainability Program Trust Fund shall be
374 distributed by the Department of Environmental Protection for
375 all of the following purposes:
376 (a) The alternative water supply program as provided in s.
377 373.707.
378 (b) The water storage facility revolving loan fund as
379 provided in s. 373.475.
380 (c) The water quality improvement grant program as provided
381 in s. 403.0673.
382 (d) The purposes specified in s. 211.41(2).
383 Section 12. This act shall take effect July 1, 2024.