HB 1283CS

CHAMBER ACTION



1The Commerce Council recommends the following:
2
3     Council/Committee Substitute
4     Remove the entire bill and insert:
5
A bill to be entitled
6An act relating to innovation incentives; amending s.
7288.1088, F.S.; providing eligibility criteria for receipt
8of funds from the Quick Action Closing Fund; requiring
9Enterprise Florida, Inc., to determine eligibility using
10specified criteria; providing for waiver of eligibility
11criteria under certain circumstances; requiring the
12Governor to provide evaluations of certain projects to the
13President of the Senate and the Speaker of the House of
14Representatives; creating s. 288.1089, F.S.; creating
15within the Office of Tourism, Trade, and Economic
16Development the Innovation Incentive Program for certain
17purposes; providing definitions; providing for innovation
18incentive awards; providing limitations; providing
19qualification requirements for review of applicants and
20projects by the office and Enterprise Florida, Inc.;
21providing proposal evaluation and recommendation
22requirements for Enterprise Florida, Inc.; authorizing the
23office to negotiate award amounts to applicants; providing
24negotiation requirements; requiring the director of the
25office to make recommendations to the Governor for
26approval or disapproval of certain projects; providing
27recommendation requirements; requiring consultation with
28the Legislature; providing for certification of applicants
29as qualified innovation businesses; providing for
30incentive payment agreements; requiring Enterprise
31Florida, Inc., to assist the office in validating certain
32business performances; requiring a report; requiring
33Enterprise Florida, Inc., to establish certain business
34ethics standards; requiring the standards to be reported
35to the Governor, the President of the Senate, and the
36Speaker of the House of Representatives; requiring
37incentive award agreements to require compliance with the
38standards; amending s. 403.973, F.S.; requiring the office
39to review certain sites for projects funded under the
40Innovation Incentive Program; amending s. 288.0655, F.S.;
41correcting a cross-reference; providing appropriations;
42providing for carrying forward certain unexpended balances
43of appropriations until a time certain; providing for
44office retention of obligated funds to be used for certain
45purposes; providing for reversion of unobligated funds;
46providing an effective date.
47
48Be It Enacted by the Legislature of the State of Florida:
49
50     Section 1.  Subsection (2) and paragraphs (a) and (b) of
51subsection (3) of section 288.1088, Florida Statutes, are
52amended to read:
53     288.1088  Quick Action Closing Fund.--
54     (2)  There is created within the Office of Tourism, Trade,
55and Economic Development the Quick Action Closing Fund. Projects
56eligible for receipt of funds from the Quick Action Closing Fund
57shall:
58     (a)  Be in a targeted industry as referenced in s. 288.106.
59     (b)  Have a positive payback ratio of at least 5 to 1.
60     (c)  Be an inducement to the project's location or
61expansion in the state.
62     (d)  Pay an average annual wage of at least 125 percent of
63the areawide or statewide private-sector average wage.
64     (e)  Be supported by the local community in which the
65project is to be located.
66     (3)(a)  Enterprise Florida, Inc., shall determine
67eligibility of each project consistent with the criteria in
68subsection (2). Enterprise Florida, Inc., in consultation with
69the Office of Tourism, Trade, and Economic Development, may
70waive these criteria based on extraordinary circumstances when
71the project would significantly benefit the local or regional
72economy. Enterprise Florida, Inc., shall evaluate individual
73proposals for high-impact business facilities and forward
74recommendations regarding the use of moneys in the fund for such
75facilities to the director of the Office of Tourism, Trade, and
76Economic Development. Such evaluation and recommendation must
77include, but need not be limited to:
78     1.  A description of the type of facility or
79infrastructure, its operations, and the associated product or
80service associated with the facility.
81     2.  The number of full-time-equivalent jobs that will be
82created by the facility and the total estimated average annual
83wages of those jobs or, in the case of privately developed rural
84infrastructure, the types of business activities and jobs
85stimulated by the investment.
86     3.  The cumulative amount of investment to be dedicated to
87the facility within a specified period.
88     4.  A statement of any special impacts the facility is
89expected to stimulate in a particular business sector in the
90state or regional economy or in the state's universities and
91community colleges.
92     5.  A statement of the role the incentive is expected to
93play in the decision of the applicant business to locate or
94expand in this state or for the private investor to provide
95critical rural infrastructure.
96     (b)  Upon receipt of the evaluation and recommendation from
97Enterprise Florida, Inc., the director shall recommend approval
98or disapproval of a project for receipt of funds from the Quick
99Action Closing Fund to the Governor. In recommending a project,
100the director shall include proposed performance conditions that
101the project must meet to obtain incentive funds. The Governor
102shall provide the evaluations of projects recommended for
103approval to the President of the Senate and the Speaker of the
104House of Representatives and consult with the President of the
105Senate and the Speaker of the House of Representatives before
106giving final approval for a project. The Executive Office of the
107Governor shall recommend approval of a project and the release
108of funds pursuant to the legislative consultation and review
109requirements set forth in s. 216.177. The recommendation must
110include proposed performance conditions that the project must
111meet in order to obtain funds.
112     Section 2.  Section 288.1089, Florida Statutes, is created
113to read:
114     288.1089  Innovation Incentive Program.--
115     (1)  The Innovation Incentive Program is created within the
116Office of Tourism, Trade, and Economic Development to ensure
117that sufficient resources are available to allow the state to
118respond expeditiously to extraordinary economic opportunities
119and to compete effectively for high-value research and
120development and innovation business projects.
121     (2)  As used in this section, the term:
122     (a)  "Average private-sector wage" means the statewide
123average wage in the private sector or the average of all
124private-sector wages in the county or in the standard
125metropolitan area in which the project is located as determined
126by the Agency for Workforce Innovation.
127     (b)  "Brownfield area" means an area designated as a
128brownfield area pursuant to s. 376.80.
129     (c)  "Cumulative investment" means cumulative capital
130investment and all eligible capital costs, as defined in s.
131220.191.
132     (d)  "Director" means the director of the Office of
133Tourism, Trade, and Economic Development.
134     (e)  "Enterprise zone" means a area designated as an
135enterprise zone pursuant to s. 290.0065.
136     (f)  "Fiscal year" means the state fiscal year.
137     (g)  "Innovation business" means a business expanding or
138locating in this state that is likely to serve as a catalyst for
139the growth of an existing or emerging technology cluster or will
140significantly impact the regional economy in which it is to
141expand or locate.
142     (h)  "Jobs" means full-time equivalent positions, as that
143term is consistent with terms used by the Agency for Workforce
144Innovation and the United States Department of Labor for
145purposes of unemployment compensation tax administration and
146employment estimation, resulting directly from a project in this
147state. The term does not include temporary construction jobs.
148     (i)  "Match" means funding from local sources, public or
149private, which will be paid to the applicant and which is equal
150to 100 percent of an award. Eligible match funding may include
151any tax abatement granted to the applicant under s. 196.1995 or
152the appraised market value of land, buildings, infrastructure,
153or equipment conveyed or provided at a discount to the
154applicant. Complete documentation of a match payment or other
155conveyance must be presented to and verified by the office prior
156to transfer of state funds to an applicant. An applicant may not
157provide, directly or indirectly, more than 5 percent of match
158funding in any fiscal year. The sources of such funding may not
159include, directly or indirectly, state funds appropriated from
160the General Revenue Fund or any state trust fund, excluding tax
161revenues shared with local governments pursuant to law.
162     (j)  "Office" means the Office of Tourism, Trade, and
163Economic Development.
164     (k)  "Project" means the location to or expansion in this
165state by an innovation business or research and development
166applicant approved for an award pursuant to this section.
167     (l)  "Research and development" means basic and applied
168research in the sciences or engineering, as well as the design,
169development, and testing of prototypes or processes of new or
170improved products. Research and development does not include
171market research, routine consumer product testing, sales
172research, research in the social sciences or psychology,
173nontechnological activities, or technical services.
174     (m)  "Research and development facility" means a facility
175that is predominately engaged in research and development
176activities. For purposes of this paragraph, the term
177"predominantly" means at least 51 percent of the time.
178     (n)  "Rural area" means a rural city, rural community, or
179rural county as defined in s. 288.106.
180     (3)  To be eligible for consideration for an innovation
181incentive award, an innovation business or research and
182development entity must submit a written application to
183Enterprise Florida, Inc., before making a decision to locate new
184operations in this state or expand an existing operation in this
185state. The application must include, but not be limited to:
186     (a)  The applicant's federal employer identification
187number, unemployment account number, and state sales tax
188registration number. If such numbers are not available at the
189time of application, they must be submitted to the office in
190writing prior to the disbursement of any payments under this
191section.
192     (b)  The location in this state at which the project is
193located or is to be located.
194     (c)  A description of the type of business activity,
195product, or research and development undertaken by the
196applicant, including six-digit North American Industry
197Classification System codes for all activities included in the
198project.
199     (d)  The applicant's projected investment in the project.
200     (e)  The total investment, from all sources, in the
201project.
202     (f)  The number of net new full-time equivalent jobs in
203this state the applicant anticipates having created as of
204December 31 of each year in the project and the average annual
205wage of such jobs.
206     (g)  The total number of full-time equivalent employees
207currently employed by the applicant in this state, if
208applicable.
209     (h)  The anticipated commencement date of the project.
210     (i)  A detailed explanation of why the innovation incentive
211is needed to induce the applicant to expand or locate in the
212state and whether an award would cause the applicant to locate
213or expand in this state.
214     (j)  If applicable, an estimate of the proportion of the
215revenues resulting from the project that will be generated
216outside this state.
217     (4)  To qualify for review by the office, the applicant
218must, at a minimum, establish the following to the satisfaction
219of Enterprise Florida, Inc., and the office:
220     (a)  The jobs created by the project must pay an estimated
221annual average wage equaling at least 130 percent of the average
222private-sector wage. The office may waive this average wage
223requirement at the request of Enterprise Florida, Inc., for a
224project located in a rural area, a brownfield area, or an
225enterprise zone, when the merits of the individual project or
226the specific circumstances in the community in relationship to
227the project warrant such action. A recommendation for waiver by
228Enterprise Florida, Inc., must include a specific justification
229for the waiver and be transmitted to the office in writing. If
230the director elects to waive the wage requirement, the waiver
231must be stated in writing and the reasons for granting the
232waiver must be explained.
233     (b)  A research and development project must:
234     1.  Serve as a catalyst for an emerging or evolving
235technology cluster.
236     2.  Demonstrate a plan for significant higher education
237collaboration.
238     3.  Provide the state, at a minimum, a break-even return on
239investment within a 20-year period.
240     4.  Be provided with a one-to-one match from the local
241community. The match requirement may be reduced or waived in
242rural areas, brownfield areas, and enterprise zones.
243     (c)  An innovation business project in this state, other
244than a research and development project, must:
245     1.a.  Result in the creation of at least 1,000 direct, new
246jobs at the business; or
247     b.  Result in the creation of at least 750 direct, new jobs
248if the project is located in a rural area, a brownfield area, or
249an enterprise zone.
250     2.  Have an activity or product that is within an industry
251that is designated as a target industry business under s.
252288.106 or a designated sector under s. 288.108.
253     3.a.  Have a cumulative investment of at least $500 million
254within a 5-year period; or
255     b.  Have a cumulative investment that exceeds $375 million
256within a 3-year period if the project is located in a rural
257area, brownfield area, or an enterprise zone.
258     (5)  Enterprise Florida, Inc., shall evaluate proposals for
259innovation incentive awards and transmit recommendations for
260awards to the office. Such evaluation and recommendation must
261include, but need not be limited to:
262     (a)  A description of the project, its required facilities,
263and the associated product, service, or research and development
264associated with the project.
265     (b)  The percentage of match provided for the project.
266     (c)  The number of full-time equivalent jobs that will be
267created by the project, the total estimated average annual wages
268of such jobs, and the types of business activities and jobs
269likely to be stimulated by the investment.
270     (d)  The cumulative investment to be dedicated to the
271project within 5 years and the total investment expected in the
272project if more than 5 years.
273     (e)  The projected economic and fiscal impacts on the local
274and state economies relative to investment.
275     (f)  A statement of any special impacts the project is
276expected to stimulate in a particular business sector in the
277state or regional economy or in the state's universities and
278community colleges.
279     (g)  A statement of any anticipated or proposed
280relationships with state universities.
281     (h)  A statement of the role the incentive is expected to
282play in the decision of the applicant to locate or expand in
283this state.
284     (i)  A recommendation and explanation of the amount of the
285award needed to cause the applicant to expand or locate in this
286state.
287     (j)  A discussion of the efforts and commitments made by
288the local community in which the project is to be located to
289induce the applicant's location or expansion, taking into
290consideration local resources and abilities.
291     (k)  A recommendation for specific performance criteria the
292applicant would be expected to achieve in order to receive
293payments from the fund and penalties or sanctions for failure to
294meet or maintain performance conditions.
295     (l)  For a research and development facility project:
296     1.  A description of the extent to which the project has
297the potential to serve as catalyst for an emerging or evolving
298cluster.
299     2.  A description of the extent to which the project has or
300could have a long-term collaborative research and development
301relationship with one or more universities or community colleges
302in this state.
303     3.  A description of the existing or projected impact of
304the project on established clusters or targeted industry
305sectors.
306     4.  A description of the project's contribution to the
307diversity and resiliency of the innovation economy of this
308state.
309     5.  A description of the project's impact on special-needs
310communities, including, but not limited to, rural areas,
311distressed urban areas, and enterprise zones.
312     (6)  In consultation with Enterprise Florida, Inc., the
313office may negotiate the proposed amount of an award for any
314applicant meeting the requirements of this section. In
315negotiating such award, the office shall consider the amount of
316the incentive needed to cause the applicant to locate or expand
317in this state in conjunction with other relevant applicant
318impact and cost information and analysis as described in this
319section. Particular emphasis shall be given to the potential for
320the project to stimulate additional private investment and high-
321quality employment opportunities in the area.
322     (7)  Upon receipt of the evaluation and recommendation from
323Enterprise Florida, Inc., the director shall recommend to the
324Governor the approval or disapproval of an award. In
325recommending approval of an award, the director shall include
326proposed performance conditions that the applicant must meet in
327order to obtain incentive funds and any other conditions that
328must be met before the receipt of any incentive funds. The
329Governor shall consult with the President of the Senate and the
330Speaker of the House of Representatives before giving approval
331for an award. Upon approval of an award, the Executive Office of
332the Governor shall release the funds pursuant to the legislative
333consultation and review requirements set forth in s. 216.177.
334     (8)  Upon approval by the Governor and release of the funds
335as set forth in subsection (7), the director shall issue a
336letter certifying the applicant as qualified for an award. The
337office and the applicant shall enter into an agreement that sets
338forth the conditions for payment of incentives. The agreement
339must include the total amount of funds awarded; the performance
340conditions that must be met to obtain the award or portions of
341the award, including, but not limited to, net new employment in
342the state, average wage, and total cumulative investment;
343demonstration of a baseline of current service and a measure of
344enhanced capability; the methodology for validating performance;
345the schedule of payments; and sanctions for failure to meet
346performance conditions, including any clawback provisions.
347     (9)  Enterprise Florida, Inc., shall assist the office in
348validating the performance of an innovation business or research
349and development facility that has received an award. At the
350conclusion of the innovation incentive award agreement, or its
351earlier termination, Enterprise Florida, Inc., shall, within 90
352days, report the results of the innovation incentive award to
353the Governor, the President of the Senate, and the Speaker of
354the House of Representatives.
355     (10)  Enterprise Florida, Inc., shall develop business
356ethics standards based on appropriate best industry practices
357which shall be applicable to all award recipients. The standards
358shall address ethical duties of business enterprises, fiduciary
359responsibilities of management, and compliance with the laws of
360this state. Enterprise Florida, Inc., may collaborate with the
361State University System in reviewing and evaluating appropriate
362business ethics standards. Such standards shall be provided to
363the Governor, the President of the Senate, and the Speaker of
364the House of Representatives by December 31, 2006. An award
365agreement entered into on or after December 31, 2006, shall
366require a recipient to comply with the business ethics standards
367developed pursuant to this section.
368     Section 3.  Subsections (16) through (19) of section
369403.973, Florida Statutes, are renumbered as subsections (17)
370through (20), respectively, and a new subsection (16) is added
371to that section, to read:
372     403.973  Expedited permitting; comprehensive plan
373amendments.--
374     (16)  The office, working with the agencies participating
375in the memoranda of agreement, shall review sites proposed for
376the location of facilities eligible for the Innovation Incentive
377Program under s. 288.1089. Within 20 days after the request for
378the review by the office, the agencies shall provide to the
379office a statement as to each site's necessary permits under
380local, state, and federal law and an identification of
381significant permitting issues, which if unresolved, may result
382in the denial of an agency permit or approval or any significant
383delay caused by the permitting process.
384     Section 4.  Paragraph (e) of subsection (2) of section
385288.0655, Florida Statutes, is amended to read:
386     288.0655  Rural Infrastructure Fund.--
387     (2)
388     (e)  To enable local governments to access the resources
389available pursuant to s. 403.973(19)(18), the office may award
390grants for surveys, feasibility studies, and other activities
391related to the identification and preclearance review of land
392which is suitable for preclearance review. Authorized grants
393under this paragraph shall not exceed $75,000 each, except in
394the case of a project in a rural area of critical economic
395concern, in which case the grant shall not exceed $300,000. Any
396funds awarded under this paragraph must be matched at a level of
39750 percent with local funds, except that any funds awarded for a
398project in a rural area of critical economic concern must be
399matched at a level of 33 percent with local funds. In evaluating
400applications under this paragraph, the office shall consider the
401extent to which the application seeks to minimize administrative
402and consultant expenses.
403     Section 5.  For the 2006-2007 fiscal year, the sum of $50
404million is appropriated from nonrecurring funds from the General
405Revenue Fund in fiscal year 2006-2007 to the Quick Action
406Closing Fund.
407     Section 6.  For fiscal year 2006-2007, the sum of
408$250,000,000 is appropriated from nonrecurring general revenue
409to the Office of Tourism, Trade, and Economic Development.
410Notwithstanding s. 216.301, Florida Statutes, and pursuant to s.
411216.351, Florida Statutes, any unexpended balance from this
412appropriation shall be carried forward at the end of each fiscal
413year until the 2010-2011 fiscal year. At the end of the 2010-
4142011 fiscal year, any obligated funds for qualified projects
415that are not yet disbursed shall remain with the office to be
416used for the purposes of this act. Any unobligated funds of this
417appropriation shall revert to the General Revenue Fund
418unallocated at the end of the 2010-2011 fiscal year.
419     Section 7.  This act shall take effect July 1, 2006.


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