HB 0505

CS

CHAMBER ACTION

1	The Finance & Tax Committee recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to the communications services tax;
7	amending s. 202.16, F.S.; requiring dealers to document
8	exempt sales for resale; providing requirements; providing
9	a definition; providing construction; providing for dealer
10	provision of evidence of the exempt status of certain
11	sales through an informal protest process; requiring the
12	Department of Revenue to accept certain evidence during
13	the protest period; providing limitations; providing for
14	retroactive application; requiring the department to
15	establish a toll-free number for certain registration and
16	resale certificate verification purposes; providing
17	requirements; requiring the department to establish a
18	system for receiving certain information relating to
19	certificate numbers of dealers making purchases for
20	resale; providing requirements; amending s. 202.19, F.S.;
21	clarifying a characterization of the local communications
22	services tax as including certain fees and being in lieu
23	of such fees; amending s. 202.20, F.S.; limiting local
24	government authority to make certain rate adjustments in
25	the tax under certain circumstances; deleting obsolete
26	provisions relating to making certain adjustments in the
27	tax for certain periods; amending s. 202.21, F.S.;
28	deleting provisions relating to local government
29	adjustments of the tax by emergency ordinance or
30	resolution to conform; specifying that certain amendments
31	are remedial in nature and clarify certain provisions of
32	law but do not grant rights to refund of certain fees or
33	charges under certain circumstances; providing effective
34	dates.
35
36	Be It Enacted by the Legislature of the State of Florida:
37
38	Section 1.  Effective upon this act becoming a law, and
39	operating retroactively to December 31, 2004, subsection (2) of
40	section 202.16, Florida Statutes, is amended to read:
41	202.16  Payment.--The taxes imposed or administered under
42	this chapter and chapter 203 shall be collected from all dealers
43	of taxable communications services on the sale at retail in this
44	state of communications services taxable under this chapter and
45	chapter 203. The full amount of the taxes on a credit sale,
46	installment sale, or sale made on any kind of deferred payment
47	plan is due at the moment of the transaction in the same manner
48	as a cash sale.
49	(2)(a)  A sale of communications services that are used as
50	a component part of or integrated into a communications service
51	or prepaid calling arrangement for resale, including, but not
52	limited to, carrier-access charges, interconnection charges paid
53	by providers of mobile communication services or other
54	communication services, charges paid by cable service providers
55	for the transmission of video or other programming by another
56	dealer of communications services, charges for the sale of
57	unbundled network elements, and any other intercompany charges
58	for the use of facilities for providing communications services
59	for resale, must be made in compliance with the rules of the
60	department. Any person who makes a sale for resale which is not
61	in compliance with these rules is liable for any tax, penalty,
62	and interest due for failing to comply, to be calculated
63	pursuant to s. 202.28(2)(a).
64	(b)1.  Any dealer who makes a sale for resale shall
65	document the exempt nature of the transaction, as established by
66	rules adopted by the department, by retaining a copy of the
67	purchaser's initial or annual resale certificate issued pursuant
68	to s. 202.17(6). In lieu of maintaining a copy of the
69	certificate, a dealer may document, prior to the time of sale,
70	an authorization number, provided telephonically or
71	electronically by the department, or by such other means
72	established by rule of the department. The dealer may rely on an
73	initial or annual resale certificate issued pursuant to s.
74	202.17(6), valid at the time of receipt from the purchaser,
75	without seeking additional annual resale certificates from such
76	purchaser, if the dealer makes recurring sales to the purchaser
77	in the normal course of business on a continual basis. For
78	purposes of this paragraph, the term "recurring sales to a
79	purchaser in the normal course of business" means a sale in
80	which the dealer extends credit to the purchaser and records the
81	debt as an account receivable, or in which the dealer sells to a
82	purchaser who has an established cash account, similar to an
83	open credit account. For purposes of this paragraph, purchases
84	are made from a selling dealer on a continual basis if the
85	selling dealer makes, in the normal course of business, sales to
86	the purchaser no less frequently than once in every 12-month
87	period.
88	2.  A dealer may, through the informal protest process
89	provided for in s. 213.21 and the rules of the department,
90	provide the department with evidence of the exempt status of a
91	sale. Exemption certificates executed by entities that were
92	exempt at the time of sale, resale certificates provided by
93	purchasers who were active dealers at the time of sale, and
94	verification by the department of a purchaser's active dealer
95	status at the time of sale in lieu of a resale certificate shall
96	be accepted by the department when submitted during the protest
97	period but may not be accepted in any proceeding under chapter
98	120 or any circuit court action instituted under chapter 72.
99	Section 2.  Effective January 1, 2006, the Department of
100	Revenue shall establish:
101	(1)  A toll-free number for the verification of valid
102	registration numbers and resale certificates under s.
103	202.16(2)(b), Florida Statutes. The system must be adequate to
104	guarantee a low busy rate, must respond to keypad inquiries, and
105	must provide data that is updated daily.
106	(2)  A system for receiving information from dealers
107	regarding certificate numbers under s. 202.16(2)(b), Florida
108	Statutes, of dealers who are seeking to make purchases for
109	resale. The department shall provide such dealers, free of
110	charge, with verification of those numbers that are canceled or
111	invalid.
112	Section 3.  Paragraph (a) of subsection (3) of section
113	202.19, Florida Statutes, is amended to read:
114	202.19  Authorization to impose local communications
115	services tax.--
116	(3)(a)  The tax authorized under this section includes and
117	is in lieu of any fee or other consideration, including, but not
118	limited to, application fees, transfer fees, renewal fees, or
119	claims for related costs, to which the municipality or county is
120	otherwise entitled for granting permission to dealers of
121	communications services, including, but not limited to,
122	providers of cable television services, as authorized in 47
123	U.S.C. s. 542, to use or occupy its roads or rights-of-way for
124	the placement, construction, and maintenance of poles, wires,
125	and other fixtures used in the provision of communications
126	services.
127	Section 4.  Paragraph (a) of subsection (2) of section
128	202.20, Florida Statutes, is amended to read:
129	202.20  Local communications services tax conversion
130	rates.--
131	(2)(a)1.  With respect to any local taxing jurisdiction,
132	if, for the periods ending December 31, 2001; March 31, 2002;
133	June 30, 2002; or September 30, 2002, the revenues received by
134	that local government from the local communications services tax
135	imposed under subsection (1) are less than the revenues received
136	from the replaced revenue sources for the corresponding 2000-
137	2001 period; plus reasonably anticipated growth in such revenues
138	over the preceding 1-year period, based on the average growth of
139	such revenues over the immediately preceding 5-year period; plus
140	an amount representing the revenues from the replaced revenue
141	sources for the 1-month period that the local taxing
142	jurisdiction was required to forego, the governing authority may
143	adjust the rate of the local communications services tax upward
144	to the extent necessary to generate the entire shortfall in
145	revenues within 1 year after the rate adjustment and by an
146	amount necessary to generate the expected amount of revenue on
147	an ongoing basis.
148	2.  If complete data are not available at the time of
149	determining whether the revenues received by a local government
150	from the local communications services tax imposed under
151	subsection (1) are less than the revenues received from the
152	replaced revenue sources for the corresponding 2000-2001 period,
153	as set forth in subparagraph 1., the local government shall use
154	the best data available for the corresponding 2000-2001 period
155	in making such determination.
156	3.  The adjustment permitted under subparagraph 1. may be
157	made by emergency ordinance or resolution and may be made
158	notwithstanding the maximum rate established under s. 202.19(2)
159	and notwithstanding any schedules or timeframes or any other
160	limitations contained in this chapter. The authority of a local
161	government to make such adjustment may be exercised only if the
162	department or a dealer reallocates revenue away from the local
163	government. The emergency ordinance or resolution shall specify
164	an effective date for the adjusted rate, which shall be no less
165	than 60 days after the date of adoption of the ordinance or
166	resolution and shall be effective with respect to taxable
167	services included on bills that are dated on the first day of a
168	month subsequent to the expiration of the 60-day period. At the
169	end of 1 year following the effective date of such adjusted
170	rate, the local governing authority shall, as soon as is
171	consistent with s. 202.21, reduce the rate by that portion of
172	the emergency rate which was necessary to recoup the amount of
173	revenues not received prior to the implementation of the
174	emergency rate.
175	4.  If, for the period October 1, 2001, through September
176	30, 2002, the revenues received by a local government from the
177	local communications services tax conversion rate established
178	under subsection (1), adjusted upward for the difference in
179	rates between paragraphs (1)(a) and (b) or any other rate
180	adjustments or base changes, are above the threshold of 10
181	percent more than the revenues received from the replaced
182	revenue sources for the corresponding 2000-2001 period plus
183	reasonably anticipated growth in such revenues over the
184	preceding 1-year period, based on the average growth of such
185	revenues over the immediately preceding 5-year period, the
186	governing authority must adjust the rate of the local
187	communications services tax to the extent necessary to reduce
188	revenues to the threshold by emergency ordinance or resolution
189	within the timeframes established in subparagraph 3. The
190	foregoing rate adjustment requirement shall not apply to a local
191	government that adopts a local communications services tax rate
192	by resolution or ordinance. If complete data are not available
193	at the time of determining whether the revenues exceed the
194	threshold, the local government shall use the best data
195	available for the corresponding 2000-2001 period in making such
196	determination. This subparagraph shall not be construed as
197	establishing a right of action for any person to enforce this
198	subparagraph or challenge a local government's implementation of
199	this subparagraph.
200	Section 5.  Effective July 1, 2007, subsection (2) of
201	section 202.20, Florida Statutes, as amended by this act, is
202	amended to read:
203	202.20  Local communications services tax conversion
204	rates.--
205	(2)(a)1.  With respect to any local taxing jurisdiction,
206	if, for the periods ending December 31, 2001; March 31, 2002;
207	June 30, 2002; or September 30, 2002, the revenues received by
208	that local government from the local communications services tax
209	imposed under subsection (1) are less than the revenues received
210	from the replaced revenue sources for the corresponding 2000-
211	2001 period; plus reasonably anticipated growth in such revenues
212	over the preceding 1-year period, based on the average growth of
213	such revenues over the immediately preceding 5-year period; plus
214	an amount representing the revenues from the replaced revenue
215	sources for the 1-month period that the local taxing
216	jurisdiction was required to forego, the governing authority may
217	adjust the rate of the local communications services tax upward
218	to the extent necessary to generate the entire shortfall in
219	revenues within 1 year after the rate adjustment and by an
220	amount necessary to generate the expected amount of revenue on
221	an ongoing basis.
222	2.  If complete data are not available at the time of
223	determining whether the revenues received by a local government
224	from the local communications services tax imposed under
225	subsection (1) are less than the revenues received from the
226	replaced revenue sources for the corresponding 2000-2001 period,
227	as set forth in subparagraph 1., the local government shall use
228	the best data available for the corresponding 2000-2001 period
229	in making such determination.
230	3.  The adjustment permitted under subparagraph 1. may be
231	made by emergency ordinance or resolution and may be made
232	notwithstanding the maximum rate established under s. 202.19(2)
233	and notwithstanding any schedules or timeframes or any other
234	limitations contained in this chapter. The authority of a local
235	government to make such adjustment may be exercised only if the
236	department or a dealer reallocates revenue away from the local
237	government. The emergency ordinance or resolution shall specify
238	an effective date for the adjusted rate, which shall be no less
239	than 60 days after the date of adoption of the ordinance or
240	resolution and shall be effective with respect to taxable
241	services included on bills that are dated on the first day of a
242	month subsequent to the expiration of the 60-day period. At the
243	end of 1 year following the effective date of such adjusted
244	rate, the local governing authority shall, as soon as is
245	consistent with s. 202.21, reduce the rate by that portion of
246	the emergency rate which was necessary to recoup the amount of
247	revenues not received prior to the implementation of the
248	emergency rate.
249	4.  If, for the period October 1, 2001, through September
250	30, 2002, the revenues received by a local government from the
251	local communications services tax conversion rate established
252	under subsection (1), adjusted upward for the difference in
253	rates between paragraphs (1)(a) and (b) or any other rate
254	adjustments or base changes, are above the threshold of 10
255	percent more than the revenues received from the replaced
256	revenue sources for the corresponding 2000-2001 period plus
257	reasonably anticipated growth in such revenues over the
258	preceding 1-year period, based on the average growth of such
259	revenues over the immediately preceding 5-year period, the
260	governing authority must adjust the rate of the local
261	communications services tax to the extent necessary to reduce
262	revenues to the threshold by emergency ordinance or resolution
263	within the timeframes established in subparagraph 3. The
264	foregoing rate adjustment requirement shall not apply to a local
265	government that adopts a local communications services tax rate
266	by resolution or ordinance. If complete data are not available
267	at the time of determining whether the revenues exceed the
268	threshold, the local government shall use the best data
269	available for the corresponding 2000-2001 period in making such
270	determination. This subparagraph shall not be construed as
271	establishing a right of action for any person to enforce this
272	subparagraph or challenge a local government's implementation of
273	this subparagraph.
274	(b)  The term Except as otherwise provided in this
275	subsection, "replaced revenue sources," as used in this section,
276	means the following taxes, charges, fees, or other impositions
277	to the extent that the respective local taxing jurisdictions
278	were authorized to impose them prior to July 1, 2000.
279	(a)1.  With respect to municipalities and charter counties
280	and the taxes authorized by s. 202.19(1):
281	1.a.  The public service tax on telecommunications
282	authorized by former s. 166.231(9).
283	2.b.  Franchise fees on cable service providers as
284	authorized by 47 U.S.C. s. 542.
285	3.c.  The public service tax on prepaid calling
286	arrangements.
287	4.d.  Franchise fees on dealers of communications services
288	which use the public roads or rights-of-way, up to the limit set
289	forth in s. 337.401. For purposes of calculating rates under
290	this section, it is the legislative intent that charter counties
291	be treated as having had the same authority as municipalities to
292	impose franchise fees on recurring local telecommunication
293	service revenues prior to July 1, 2000. However, the Legislature
294	recognizes that the authority of charter counties to impose such
295	fees is in dispute, and the treatment provided in this section
296	is not an expression of legislative intent that charter counties
297	actually do or do not possess such authority.
298	5.e.  Actual permit fees relating to placing or maintaining
299	facilities in or on public roads or rights-of-way, collected
300	from providers of long-distance, cable, and mobile
301	communications services for the fiscal year ending September 30,
302	1999; however, if a municipality or charter county elects the
303	option to charge permit fees pursuant to s. 337.401(3)(c)1.a.,
304	such fees shall not be included as a replaced revenue source.
305	(b)2.  With respect to all other counties and the taxes
306	authorized in s. 202.19(1), franchise fees on cable service
307	providers as authorized by 47 U.S.C. s. 542.
308	Section 6.  Effective July 1, 2007, section 202.21, Florida
309	Statutes, is amended to read:
310	202.21  Effective dates; procedures for informing dealers
311	of communications services of tax levies and rate changes.--Any
312	adoption, repeal, or change in the rate of a local
313	communications services tax imposed under s. 202.19 is effective
314	with respect to taxable services included on bills that are
315	dated on or after the January 1 subsequent to such adoption,
316	repeal, or change. A municipality or county adopting, repealing,
317	or changing the rate of such tax must notify the department of
318	the adoption, repeal, or change by September 1 immediately
319	preceding such January 1. Notification must be furnished on a
320	form prescribed by the department and must specify the rate of
321	tax; the effective date of the adoption, repeal, or change
322	thereof; and the name, mailing address, and telephone number of
323	a person designated by the municipality or county to respond to
324	inquiries concerning the tax. The department shall provide
325	notice of such adoption, repeal, or change to all affected
326	dealers of communications services at least 90 days before the
327	effective date of the tax. Any local government that adjusts the
328	rate of its local communications services tax by emergency
329	ordinance or resolution pursuant to s. 202.20(2) shall notify
330	the department of the new tax rate immediately upon its
331	adoption. The department shall provide written notice of the
332	adoption of the new rate to all affected dealers within 30 days
333	after receiving such notice. In any notice to providers or
334	publication of local tax rates for purposes of this chapter, the
335	department shall express the rate for a municipality or charter
336	county as the sum of the tax rates levied within such
337	jurisdiction pursuant to s. 202.19(2)(a) and (5), and shall
338	express the rate for any other county as the sum of the tax
339	rates levied pursuant to s. 202.19(2)(b) and (5). The department
340	is not liable for any loss of or decrease in revenue by reason
341	of any error, omission, or untimely action that results in the
342	nonpayment of a tax imposed under s. 202.19.
343	Section 7.  The amendments to s. 202.19(3)(a), Florida
344	Statutes, contained in this act are remedial in nature and
345	intended to clarify the law in effect on October 1, 2001, but do
346	not grant any right to a refund of any fees or charges paid
347	prior to July 1, 2005, unless the payment was made under written
348	protest as to the authority of any local government to impose
349	such fees or costs on a dealer.
350	Section 8.  Except as otherwise provided herein, this act
351	shall take effect upon becoming a law.

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