HB 1069

1	A bill to be entitled
2	An act relating to capital investment tax credits;
3	amending s. 220.191, F.S.; providing an exception to the
4	prohibition against carrying capital investment tax
5	credits forward or backward for a certain capital
6	investment tax credit; providing a capital investment tax
7	credit to a qualifying business relating to the amount of
8	investment tax credit that is unusable against the
9	corporate income tax or premium tax to apply against
10	liability for the sales and use tax; requiring that a
11	qualifying business applying the tax credit against the
12	sales and use tax make an additional capital investment of
13	a specified amount within a certain period; requiring
14	annual reports to the Legislature and the Office of
15	Tourism, Trade, and Economic Development related to
16	investments made by a qualifying business applying credits
17	against the sales and use tax; requiring a qualifying
18	business that fails to make the required capital
19	investments to repay the amount of the sales and use tax
20	credit claimed with interest; authorizing the Office of
21	Tourism, Trade, and Economic Development and the
22	Department of Revenue to adopt rules; providing an
23	effective date.
24
25	Be It Enacted by the Legislature of the State of Florida:
26
27	Section 1.  Section 220.191, Florida Statutes, is amended
28	to read:
29	220.191  Capital investment tax credit.-
30	(1)  DEFINITIONS.-As used in For purposes of this section:
31	(a)  "Commencement of operations" means the beginning of
32	active operations by a qualifying business of the principal
33	function for which a qualifying project was constructed.
34	(b)  "Cumulative capital investment" means the total
35	capital investment in land, buildings, and equipment made in
36	connection with a qualifying project during the period from the
37	beginning of construction of the project to the commencement of
38	operations.
39	(c)  "Eligible capital costs" means all expenses incurred
40	by a qualifying business in connection with the acquisition,
41	construction, installation, and equipping of a qualifying
42	project during the period from the beginning of construction of
43	the project to the commencement of operations, including, but
44	not limited to:
45	1.  The costs of acquiring, constructing, installing,
46	equipping, and financing a qualifying project, including all
47	obligations incurred for labor and obligations to contractors,
48	subcontractors, builders, and materialmen.
49	2.  The costs of acquiring land or rights to land and any
50	cost incidental thereto, including recording fees.
51	3.  The costs of architectural and engineering services,
52	including test borings, surveys, estimates, plans and
53	specifications, preliminary investigations, environmental
54	mitigation, and supervision of construction, as well as the
55	performance of all duties required by or consequent to the
56	acquisition, construction, installation, and equipping of a
57	qualifying project.
58	4.  The costs associated with the installation of fixtures
59	and equipment; surveys, including archaeological and
60	environmental surveys; site tests and inspections; subsurface
61	site work and excavation; removal of structures, roadways, and
62	other surface obstructions; filling, grading, paving, and
63	provisions for drainage, storm water retention, and installation
64	of utilities, including water, sewer, sewage treatment, gas,
65	electricity, communications, and similar facilities; and offsite
66	construction of utility extensions to the boundaries of the
67	property.
68
69	The term does Eligible capital costs shall not include the cost
70	of any property previously owned or leased by the qualifying
71	business.
72	(d)  "Income generated by or arising out of the qualifying
73	project" means the qualifying project's annual taxable income as
74	determined by generally accepted accounting principles and under
75	s. 220.13.
76	(e)  "Jobs" means full-time equivalent positions, as that
77	term is consistent with terms used by the Agency for Workforce
78	Innovation and the United States Department of Labor for
79	purposes of unemployment tax administration and employment
80	estimation, resulting directly from a project in this state. The
81	term does not include temporary construction jobs involved in
82	the construction of the project facility.
83	(f)  "Office" means the Office of Tourism, Trade, and
84	Economic Development.
85	(g)  "Qualifying business" means a business which
86	establishes a qualifying project in this state and which is
87	certified by the office to receive tax credits pursuant to this
88	section.
89	(h)  "Qualifying project" means:
90	1.  A new or expanding facility in this state which creates
91	at least 100 new jobs in this state and is in one of the high-
92	impact sectors identified by Enterprise Florida, Inc., and
93	certified by the office pursuant to s. 288.108(6), including,
94	but not limited to, aviation, aerospace, automotive, and silicon
95	technology industries;
96	2.  A new or expanded facility in this state which is
97	engaged in a target industry designated pursuant to the
98	procedure specified in s. 288.106(2)(t) and which is induced by
99	this credit to create or retain at least 1,000 jobs in this
100	state, provided that at least 100 of those jobs are new, pay an
101	annual average wage of at least 130 percent of the average
102	private sector wage in the area as defined in s. 288.106(2), and
103	make a cumulative capital investment of at least $100 million
104	after July 1, 2005. Jobs may be considered retained only if
105	there is significant evidence that the loss of jobs is imminent.
106	Notwithstanding subsection (2), annual credits against the tax
107	imposed by this chapter may shall not exceed 50 percent of the
108	increased annual corporate income tax liability or the premium
109	tax liability generated by or arising out of a project
110	qualifying under this subparagraph. A facility that qualifies
111	under this subparagraph for an annual credit against the tax
112	imposed by this chapter may take the tax credit for a period not
113	to exceed 5 years; or
114	3.  A new or expanded headquarters facility in this state
115	which locates in an enterprise zone and brownfield area and is
116	induced by this credit to create at least 1,500 jobs which on
117	average pay at least 200 percent of the statewide average annual
118	private sector wage, as published by the Agency for Workforce
119	Innovation or its successor, and which new or expanded
120	headquarters facility makes a cumulative capital investment in
121	this state of at least $250 million.
122	(2)(a)  An annual credit against the tax imposed by this
123	chapter shall be granted to any qualifying business in an amount
124	equal to 5 percent of the eligible capital costs generated by a
125	qualifying project, for a period not to exceed 20 years
126	beginning with the commencement of operations of the project.
127	Unless assigned as described in this subsection, the tax credit
128	shall be granted against only the corporate income tax liability
129	or the premium tax liability generated by or arising out of the
130	qualifying project, and the sum of all tax credits provided
131	pursuant to this section may shall not exceed 100 percent of the
132	eligible capital costs of the project. Except as provided in
133	paragraph (d), a In no event may any credit granted under this
134	section may not be carried forward or backward by any qualifying
135	business with respect to a subsequent or prior year. The annual
136	tax credit granted under this section may shall not exceed the
137	following percentages of the annual corporate income tax
138	liability or the premium tax liability generated by or arising
139	out of a qualifying project:
140	1.  One hundred percent for a qualifying project which
141	results in a cumulative capital investment of at least $100
142	million.
143	2.  Seventy-five percent for a qualifying project which
144	results in a cumulative capital investment of at least $50
145	million but less than $100 million.
146	3.  Fifty percent for a qualifying project which results in
147	a cumulative capital investment of at least $25 million but less
148	than $50 million.
149	(b)  A qualifying project that which results in a
150	cumulative capital investment of less than $25 million is not
151	eligible for the capital investment tax credit. An insurance
152	company claiming a credit against premium tax liability under
153	this program is shall not be required to pay any additional
154	retaliatory tax levied pursuant to s. 624.5091 as a result of
155	claiming such credit. Because credits under this section are
156	available to an insurance company, s. 624.5091 does not limit
157	such credit in any manner.
158	(c)  A qualifying business that establishes a qualifying
159	project that includes locating a new solar panel manufacturing
160	facility in this state that generates a minimum of 400 jobs
161	within 6 months after commencement of operations with an average
162	salary of at least $50,000 may assign or transfer the annual
163	credit, or any portion thereof, granted under this section to
164	any other business. However, the amount of the tax credit that
165	may be transferred in any year is shall be the lesser of the
166	qualifying business's state corporate income tax liability for
167	that year, as limited by the percentages applicable under
168	paragraph (a) and as calculated before prior to taking any
169	credit pursuant to this section, or the credit amount granted
170	for that year. A business receiving the transferred or assigned
171	credits may use the credits only in the year received, and the
172	credits may not be carried forward or backward. To perfect the
173	transfer, the transferor must shall provide the department with
174	a written transfer statement notifying the department of the
175	transferor's intent to transfer the tax credits to the
176	transferee; the date the transfer is effective; the transferee's
177	name, address, and federal taxpayer identification number; the
178	tax period; and the amount of tax credits to be transferred. The
179	department shall, upon receipt of a transfer statement
180	conforming to the requirements of this paragraph, provide the
181	transferee with a certificate reflecting the tax credit amounts
182	transferred. A copy of the certificate must be attached to each
183	tax return for which the transferee seeks to apply such tax
184	credits.
185	(d)  Beginning in the year 2011, if the credit granted
186	under this subsection is not fully used in fiscal year 2011 and
187	all years thereafter because of insufficient tax liability on
188	the part of the qualifying business, the qualifying business is
189	entitled to a sales tax credit against its sales tax liability
190	in an amount equal to the difference between the annual tax
191	credit granted under this subsection, as computed pursuant to
192	paragraph (a), and the amount of credit that is actually usable
193	against the corporate income tax liability or premium tax. The
194	sales tax credit shall be granted against the state sales and
195	use taxes collected, reported, and remitted under chapter 212
196	during the 12-month period beginning on the date the qualifying
197	business files its corporate income tax return for the year in
198	which the credit granted under this subsection is not fully
199	usable. The sales tax credit granted under this paragraph may
200	not exceed $5 million in any one year and is subject to the
201	following:
202	1.  A qualifying business that applies its sales tax credit
203	against its sales and use tax liability must make capital
204	investments in Florida, in addition to its cumulative capital
205	investment, in an amount equal to or greater than the applied
206	credit within 5 years after the date that the qualifying
207	business first applied the sales tax credit to its sales and use
208	tax return.
209	2.  The qualifying business must annually provide to the
210	office, the President of the Senate, and the Speaker of the
211	House of Representatives a report listing the capital
212	investments made in each tax year in which the business claims a
213	sales and use tax credit pursuant to this paragraph and must
214	provide a final summary report of all capital investments made
215	pursuant to the requirements of this paragraph.
216	3.  If the qualifying business fails to make the capital
217	investments pursuant to subparagraph 1. or if the business fails
218	to report its capital investments pursuant to subparagraph 2.,
219	the qualifying business shall repay to the Department of Revenue
220	the difference between the sales tax credits received and the
221	amount of capital investments accounted for plus interest as
222	provided for delinquent taxes under chapter 212.
223	4.  This paragraph applies only to businesses headquartered
224	in Florida qualifying for this credit pursuant to subparagraph
225	(2)(a)1. and only to businesses that received signed letters of
226	approval and entry into the Capital Investment Tax Credit
227	Program from the years 2006-2008.
228
229	The office and the Department of Revenue may adopt rules to
230	administer this paragraph.
231	(3)(a)  Notwithstanding subsection (2), an annual credit
232	against the tax imposed by this chapter shall be granted to a
233	qualifying business which establishes a qualifying project
234	pursuant to subparagraph (1)(h)3., in an amount equal to the
235	lesser of $15 million or 5 percent of the eligible capital costs
236	made in connection with a qualifying project, for a period not
237	to exceed 20 years beginning with the commencement of operations
238	of the project. The tax credit shall be granted against the
239	corporate income tax liability of the qualifying business and as
240	further provided in paragraph (c). The total tax credit provided
241	pursuant to this subsection shall be equal to no more than 100
242	percent of the eligible capital costs of the qualifying project.
243	(b)  If the credit granted under this subsection is not
244	fully used in any one year because of insufficient tax liability
245	on the part of the qualifying business, the unused amount may be
246	carried forward for a period not to exceed 20 years after the
247	commencement of operations of the project. The carryover credit
248	may be used in a subsequent year when the tax imposed by this
249	chapter for that year exceeds the credit for which the
250	qualifying business is eligible in that year under this
251	subsection after applying the other credits and unused
252	carryovers in the order provided by s. 220.02(8).
253	(c)  The credit granted under this subsection may be used
254	in whole or in part by the qualifying business or any
255	corporation that is either a member of that qualifying
256	business's affiliated group of corporations, is a related entity
257	taxable as a cooperative under subchapter T of the Internal
258	Revenue Code, or, if the qualifying business is an entity
259	taxable as a cooperative under subchapter T of the Internal
260	Revenue Code, is related to the qualifying business. Any entity
261	related to the qualifying business may continue to file as a
262	member of a Florida-nexus consolidated group pursuant to a prior
263	election made under s. 220.131(1), Florida Statutes (1985), even
264	if the parent of the group changes due to a direct or indirect
265	acquisition of the former common parent of the group. Any credit
266	can be used by any of the affiliated companies or related
267	entities referenced in this paragraph to the same extent as it
268	could have been used by the qualifying business. However, any
269	such use shall not operate to increase the amount of the credit
270	or extend the period within which the credit must be used.
271	(4)  Before Prior to receiving tax credits pursuant to this
272	section, a qualifying business must achieve and maintain the
273	minimum employment goals beginning with the commencement of
274	operations at a qualifying project and continuing each year
275	thereafter during which tax credits are available pursuant to
276	this section.
277	(5)  Applications shall be reviewed and certified pursuant
278	to s. 288.061. The office, upon a recommendation by Enterprise
279	Florida, Inc., shall first certify a business as eligible to
280	receive tax credits pursuant to this section prior to the
281	commencement of operations of a qualifying project, and such
282	certification shall be transmitted to the Department of Revenue.
283	Upon receipt of the certification, the Department of Revenue
284	shall enter into a written agreement with the qualifying
285	business specifying, at a minimum, the method by which income
286	generated by or arising out of the qualifying project will be
287	determined.
288	(6)  The office, in consultation with Enterprise Florida,
289	Inc., is authorized to develop the necessary guidelines and
290	application materials for the certification process described in
291	subsection (5).
292	(7)  It shall be the responsibility of The qualifying
293	business has the responsibility to affirmatively demonstrate to
294	the satisfaction of the Department of Revenue that such business
295	meets the job creation and capital investment requirements of
296	this section.
297	(8)  The Department of Revenue may specify by rule the
298	methods by which a project's pro forma annual taxable income is
299	determined.
300	Section 2.  This act shall take effect July 1, 2011.

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