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.
   60  Be It Enacted by the Legislature of the State of Florida:
   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.