| 1 | A bill to be entitled |
| 2 | An act relating to targeted economic development; amending |
| 3 | s. 288.106, F.S.; redefining the term "target industry |
| 4 | business" to revise the eligibility criteria for the tax |
| 5 | refund program for target industry businesses; requiring |
| 6 | certain local governing boards to notify the Office of |
| 7 | Tourism, Trade, and Economic Development and Enterprise |
| 8 | Florida, Inc., of the average private-sector wage |
| 9 | calculation to be used for purposes of a business's wage |
| 10 | commitment under the tax refund program; amending s. |
| 11 | 377.809, F.S.; deleting an obsolete provision; revising |
| 12 | the date by which the Department of Community Affairs must |
| 13 | submit a report to the Governor and Legislature which |
| 14 | evaluates the success of the Energy Economic Zone Pilot |
| 15 | Program; requiring that all incentives and benefits |
| 16 | provided for enterprise zones be made available to energy |
| 17 | economic zones by a specified date; assigning duties for |
| 18 | the administration of energy economic zones to the local |
| 19 | governing bodies that have jurisdiction over such zones; |
| 20 | providing for boundaries of the zones, eligibility |
| 21 | criteria for the incentives, and benefits provided in the |
| 22 | zones; specifying the incentives and benefits available in |
| 23 | the zones; requiring that the applicable requirements for |
| 24 | employee residency for higher refund or credit thresholds |
| 25 | be based on employee residency in the energy economic zone |
| 26 | or an enterprise zone; establishing priorities for funding |
| 27 | certain projects; limiting the annual amount of such |
| 28 | incentives; authorizing the carryforward of any unused |
| 29 | amount of incentives for a specified period; providing for |
| 30 | the issuance of certificates to eligible businesses; |
| 31 | requiring the local governing body to certify to the |
| 32 | Department of Revenue or the Office of Tourism, Trade, and |
| 33 | Economic Development which businesses or properties are |
| 34 | eligible for the incentives; requiring the Department of |
| 35 | Revenue to send written instructions to eligible |
| 36 | businesses on claiming the credit on a sales and use tax |
| 37 | return initiated through an electronic data interchange; |
| 38 | authorizing the Office of Tourism, Trade, and Economic |
| 39 | Development and the Department of Revenue to adopt |
| 40 | emergency rules; providing for renewal of the rules; |
| 41 | amending s. 380.06, F.S.; exempting certain developments |
| 42 | in an energy economic zone from review as a development of |
| 43 | regional impact; providing an effective date. |
| 44 |
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| 45 | Be It Enacted by the Legislature of the State of Florida: |
| 46 |
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| 47 | Section 1. Paragraph (t) of subsection (2) and paragraph |
| 48 | (b) of subsection (4) of section 288.106, Florida Statutes, are |
| 49 | amended to read: |
| 50 | 288.106 Tax refund program for qualified target industry |
| 51 | businesses.- |
| 52 | (2) DEFINITIONS.-As used in this section: |
| 53 | (t) "Target industry business" means a corporate |
| 54 | headquarters business or any business that is engaged in one of |
| 55 | the target industries identified pursuant to the following |
| 56 | criteria developed by the office in consultation with Enterprise |
| 57 | Florida, Inc.: |
| 58 | 1. Future growth.-Industry forecasts should indicate |
| 59 | strong expectation for future growth in both employment and |
| 60 | output, according to the most recent available data. Special |
| 61 | consideration should be given to businesses that export goods |
| 62 | to, or provide services in, international markets and businesses |
| 63 | that replace domestic and international imports of goods or |
| 64 | services. |
| 65 | 2. Stability.-The industry should not be subject to |
| 66 | periodic layoffs, whether due to seasonality or sensitivity to |
| 67 | volatile economic variables such as weather. The industry should |
| 68 | also be relatively resistant to recession, so that the demand |
| 69 | for products of this industry is not typically subject to |
| 70 | decline during an economic downturn. |
| 71 | 3. High wage.-The industry should pay relatively high |
| 72 | wages compared to statewide or area averages. |
| 73 | 4. Market and resource independent.-The location of |
| 74 | industry businesses should not be dependent on Florida markets |
| 75 | or resources as indicated by industry analysis, except for |
| 76 | businesses in the renewable energy industry. |
| 77 | 5. Industrial base diversification and strengthening.-The |
| 78 | industry should contribute toward expanding or diversifying the |
| 79 | state's or area's economic base, as indicated by analysis of |
| 80 | employment and output shares compared to national and regional |
| 81 | trends. Special consideration should be given to industries that |
| 82 | strengthen regional economies by adding value to basic products |
| 83 | or building regional industrial clusters as indicated by |
| 84 | industry analysis. Special consideration should also be given to |
| 85 | the development of strong industrial clusters that include |
| 86 | defense and homeland security businesses. |
| 87 | 6. Positive economic impact benefits.-The industry is |
| 88 | expected to have strong positive impacts on or benefits to the |
| 89 | state or regional economies. Special consideration should be |
| 90 | given to industries that facilitate the development of the state |
| 91 | as a hub for domestic and global trade and logistics. |
| 92 |
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| 93 | The term does not include any business engaged in retail |
| 94 | industry activities; any electrical utility company; any |
| 95 | phosphate or other solid minerals severance, mining, or |
| 96 | processing operation; any oil or gas exploration or production |
| 97 | operation; or any business subject to regulation by the Division |
| 98 | of Hotels and Restaurants of the Department of Business and |
| 99 | Professional Regulation. Any business within NAICS code 5611 or |
| 100 | 5614, office administrative services and business support |
| 101 | services, respectively, may be considered a target industry |
| 102 | business only after the local governing body and Enterprise |
| 103 | Florida, Inc., make a determination that the community where the |
| 104 | business may locate has conditions affecting the fiscal and |
| 105 | economic viability of the local community or area, including but |
| 106 | not limited to, factors such as low per capita income, high |
| 107 | unemployment, high underemployment, and a lack of year-round |
| 108 | stable employment opportunities, and such conditions may be |
| 109 | improved by the location of such a business to the community. By |
| 110 | January 1 of every 3rd year, beginning January 1, 2011, the |
| 111 | office, in consultation with Enterprise Florida, Inc., economic |
| 112 | development organizations, the State University System, local |
| 113 | governments, employee and employer organizations, market |
| 114 | analysts, and economists, shall review and, as appropriate, |
| 115 | revise the list of such target industries and submit the list to |
| 116 | the Governor, the President of the Senate, and the Speaker of |
| 117 | the House of Representatives. |
| 118 | (4) APPLICATION AND APPROVAL PROCESS.- |
| 119 | (b) To qualify for review by the office, the application |
| 120 | of a target industry business must, at a minimum, establish the |
| 121 | following to the satisfaction of the office: |
| 122 | 1.a. The jobs proposed to be created under the |
| 123 | application, pursuant to subparagraph (a)4., must pay an |
| 124 | estimated annual average wage equaling at least 115 percent of |
| 125 | the average private sector wage in the area where the business |
| 126 | is to be located or the statewide private sector average wage. |
| 127 | The governing board of the local governmental entity providing |
| 128 | the local financial support county where the qualified target |
| 129 | industry business is to be located shall notify the office and |
| 130 | Enterprise Florida, Inc., which calculation of the average |
| 131 | private sector wage in the area must be used as the basis for |
| 132 | the business's wage commitment. In determining the average |
| 133 | annual wage, the office shall include only new proposed jobs, |
| 134 | and wages for existing jobs shall be excluded from this |
| 135 | calculation. |
| 136 | b. The office may waive the average wage requirement at |
| 137 | the request of the local governing body recommending the project |
| 138 | and Enterprise Florida, Inc. The office may waive the wage |
| 139 | requirement for a project located in a brownfield area |
| 140 | designated under s. 376.80, in a rural city, in a rural |
| 141 | community, in an enterprise zone, or for a manufacturing project |
| 142 | at any location in the state if the jobs proposed to be created |
| 143 | pay an estimated annual average wage equaling at least 100 |
| 144 | percent of the average private sector wage in the area where the |
| 145 | business is to be located, only if the merits of the individual |
| 146 | project or the specific circumstances in the community in |
| 147 | relationship to the project warrant such action. If the local |
| 148 | governing body and Enterprise Florida, Inc., make such a |
| 149 | recommendation, it must be transmitted in writing, and the |
| 150 | specific justification for the waiver recommendation must be |
| 151 | explained. If the office elects to waive the wage requirement, |
| 152 | the waiver must be stated in writing, and the reasons for |
| 153 | granting the waiver must be explained. |
| 154 | 2. The target industry business's project must result in |
| 155 | the creation of at least 10 jobs at the project and, in the case |
| 156 | of an expansion of an existing business, must result in a net |
| 157 | increase in employment of at least 10 percent at the business. |
| 158 | At the request of the local governing body recommending the |
| 159 | project and Enterprise Florida, Inc., the office may waive this |
| 160 | requirement for a business in a rural community or enterprise |
| 161 | zone if the merits of the individual project or the specific |
| 162 | circumstances in the community in relationship to the project |
| 163 | warrant such action. If the local governing body and Enterprise |
| 164 | Florida, Inc., make such a request, the request must be |
| 165 | transmitted in writing, and the specific justification for the |
| 166 | request must be explained. If the office elects to grant the |
| 167 | request, the grant must be stated in writing, and the reason for |
| 168 | granting the request must be explained. |
| 169 | 3. The business activity or product for the applicant's |
| 170 | project must be within an industry identified by the office as a |
| 171 | target industry business that contributes to the economic growth |
| 172 | of the state and the area in which the business is located, that |
| 173 | produces a higher standard of living for residents of this state |
| 174 | in the new global economy, or that can be shown to make an |
| 175 | equivalent contribution to the area's and state's economic |
| 176 | progress. |
| 177 | Section 2. Subsection (4) of section 377.809, Florida |
| 178 | Statutes, is amended, and subsection (5) is added to that |
| 179 | section, to read: |
| 180 | 377.809 Energy Economic Zone Pilot Program.- |
| 181 | (4) If the pilot project is ongoing, The Department of |
| 182 | Community Affairs, with the assistance of the Office of Tourism, |
| 183 | Trade, and Economic Development, shall submit a report to the |
| 184 | Governor, the President of the Senate, and the Speaker of the |
| 185 | House of Representatives by February 15, 2015 2012, evaluating |
| 186 | whether the pilot program has demonstrated success. The report |
| 187 | shall contain recommendations with regard to whether the program |
| 188 | should be expanded for use by other local governments and |
| 189 | whether state policies should be revised to encourage the goals |
| 190 | of the program. |
| 191 | (5)(a) Beginning July 1, 2012, all the incentives and |
| 192 | benefits provided for enterprise zones pursuant to state law |
| 193 | shall be available to the energy economic zones designated |
| 194 | pursuant to this section on or before July 1, 2010. In order to |
| 195 | provide incentives, by March 1, 2012, each local governing body |
| 196 | that has jurisdiction over an energy economic zone must, by |
| 197 | local ordinance, establish the boundary of the energy economic |
| 198 | zone, specify applicable energy-efficiency standards, and |
| 199 | determine eligibility criteria for the application of state and |
| 200 | local incentives and benefits in the energy economic zone. |
| 201 | However, in order to receive benefits provided under s. 288.106, |
| 202 | a business must be a qualified target industry business under s. |
| 203 | 288.106 for state purposes. An energy economic zone's boundary |
| 204 | may be revised by local ordinance. Such incentives and benefits |
| 205 | include those in ss. 212.08, 212.096, 220.181, 220.182, 220.183, |
| 206 | 288.106, and 624.5105 and the public utility discounts provided |
| 207 | in s. 290.007(8). The exemption provided in s. 212.08(5)(c) |
| 208 | shall be for renewable energy as defined in s. 377.803. For |
| 209 | purposes of this section, any applicable requirements for |
| 210 | employee residency for higher refund or credit thresholds must |
| 211 | be based on employee residency in the energy economic zone or an |
| 212 | enterprise zone. A business in an energy economic zone may also |
| 213 | be eligible for funding under ss. 288.047 and 445.003, and a |
| 214 | transportation project in an energy economic zone shall be |
| 215 | provided priority in funding under s. 288.063. Other projects |
| 216 | shall be given priority ranking to the extent practicable for |
| 217 | grants administered under state energy programs. |
| 218 | (b) Effective July 1, 2012, the total amount of state |
| 219 | credits, refunds, and exemptions that may be provided by the |
| 220 | governing body of each energy economic zone to eligible |
| 221 | businesses for energy-economic-zone incentives pursuant to |
| 222 | paragraph (a) is $300,000 per designated energy economic zone in |
| 223 | any state fiscal year. The governing body of an energy economic |
| 224 | zone shall disallow a credit or refund for which an application |
| 225 | is submitted after the zone's respective $300,000 limit is |
| 226 | reached. If the $300,000 incentive cap is not fully used in any |
| 227 | one state fiscal year by an energy economic zone, the unused |
| 228 | amount under the cap may be carried forward for up to 5 years. |
| 229 | The local governing body that has jurisdiction over the energy |
| 230 | economic zone is responsible for allocating the incentives, for |
| 231 | verifying that businesses receiving such incentives are eligible |
| 232 | for the incentives provided, and for ensuring that the |
| 233 | incentives provided do not exceed the cap for the state fiscal |
| 234 | year. |
| 235 | (c) Upon approving an incentive for an eligible business, |
| 236 | the governing body that has jurisdiction over the energy |
| 237 | economic zone shall provide the taxpayer with a certificate |
| 238 | indicating the name and federal identification number of the |
| 239 | eligible business, the date the incentive is provided, the name |
| 240 | of the energy economic zone, the incentive type, and the |
| 241 | incentive amount. The local governing body shall certify to the |
| 242 | Department of Revenue or the Office of Tourism, Trade, and |
| 243 | Economic Development, whichever is applicable, which businesses |
| 244 | or properties are eligible to receive any or all of the state |
| 245 | incentives according to their statutory requirements. The |
| 246 | governing body that has jurisdiction over the energy economic |
| 247 | zone shall provide a copy of the certificate to the Department |
| 248 | of Revenue and the Office of Tourism, Trade, and Economic |
| 249 | Development as notification that such incentives were approved |
| 250 | for the specific eligible business or property. For incentives |
| 251 | to be claimed against the sales and use tax under chapter 212, |
| 252 | the Department of Revenue shall send, within 14 days after |
| 253 | receipt, written instructions to an eligible business on how to |
| 254 | claim the credit on a sales and use tax return initiated through |
| 255 | an electronic data interchange. Any credit against the sales and |
| 256 | use tax shall be deducted from any sales and use tax remitted by |
| 257 | the dealer to the Department of Revenue by electronic funds |
| 258 | transfer and may be deducted only on a sales and use tax return |
| 259 | initiated through an electronic data interchange. The dealer |
| 260 | shall separately state the credit on the electronic return. The |
| 261 | net amount of tax due and payable must be remitted by electronic |
| 262 | funds transfer. If the credit exceeds the amount owed on the |
| 263 | sales and use tax return, such excess amount may be carried |
| 264 | forward for a period not to exceed 12 months after the date that |
| 265 | the credit is initially claimed. |
| 266 | (d) If all conditions are deemed met, the Office of |
| 267 | Tourism, Trade, and Economic Development and the Department of |
| 268 | Revenue may adopt emergency rules pursuant to ss. 120.536(1) and |
| 269 | 120.54 to administer the provisions of this subsection. The |
| 270 | emergency rules shall remain in effect for 6 months after the |
| 271 | rules are adopted, and the rules may be renewed while the |
| 272 | procedures to adopt permanent rules addressing the subject of |
| 273 | the emergency rules are pending. |
| 274 | Section 3. Paragraph (u) is added to subsection (24) of |
| 275 | section 380.06, Florida Statutes, to read: |
| 276 | 380.06 Developments of regional impact.- |
| 277 | (24) STATUTORY EXEMPTIONS.- |
| 278 | (u) Any development in an energy economic zone designated |
| 279 | pursuant to s. 377.809 is exempt from this section upon approval |
| 280 | by its local governing body. |
| 281 |
|
| 282 | If a use is exempt from review as a development of regional |
| 283 | impact under paragraphs (a)-(s), but will be part of a larger |
| 284 | project that is subject to review as a development of regional |
| 285 | impact, the impact of the exempt use must be included in the |
| 286 | review of the larger project, unless such exempt use involves a |
| 287 | development of regional impact that includes a landowner, |
| 288 | tenant, or user that has entered into a funding agreement with |
| 289 | the Office of Tourism, Trade, and Economic Development under the |
| 290 | Innovation Incentive Program and the agreement contemplates a |
| 291 | state award of at least $50 million. |
| 292 | Section 4. This act shall take effect July 1, 2011. |