Florida Senate - 2019                                    SB 1394
       By Senator Torres
       15-01226-19                                           20191394__
    1                        A bill to be entitled                      
    2         An act relating to the entertainment industry
    3         financial incentive program; reviving, readopting, and
    4         amending s. 288.1254, F.S., relating to the
    5         entertainment industry financial incentive program;
    6         deleting terms; revising the purpose of the
    7         entertainment industry financial incentive program;
    8         revising the application process for the program;
    9         revising the certification process for tax credit
   10         awards under the program; requiring that the names of
   11         certain cities, towns, and counties be included in
   12         certain credits; revising the process for determining
   13         the priority of a qualified production for tax credit
   14         awards; revising the eligibility requirements for a
   15         tax credit award and the amount of tax credits that
   16         may be awarded; revising the date on which or after
   17         which a certified production company or certain
   18         persons may relinquish tax credits; revising the
   19         aggregate amount of tax credits that may be certified
   20         per fiscal year; requiring that a specified amount of
   21         funding be allocated to counties; authorizing a local
   22         film commission to negotiate tax credit awards with a
   23         potential certified production company; authorizing
   24         allocations that are not encumbered by a specified
   25         date to be made available to other counties; providing
   26         for a scheduled repeal of the act; providing
   27         exceptions; providing an effective date.
   29  Be It Enacted by the Legislature of the State of Florida:
   31         Section 1. Notwithstanding the repeal of section 288.1254,
   32  Florida Statutes, in section 15 of chapter 2012-32, Laws of
   33  Florida, section 288.1254, Florida Statutes, is revived,
   34  readopted, and amended to read:
   35         288.1254 Entertainment industry financial incentive
   36  program.—
   37         (1) DEFINITIONS.—As used in this section, the term:
   38         (a) “Certified production” means a qualified production
   39  that has tax credits allocated to it by the department based on
   40  the production’s estimated qualified expenditures, up to the
   41  production’s maximum certified amount of tax credits, by the
   42  department. The term does not include a production if its first
   43  day of principal photography or project start date in this state
   44  occurs before the production is certified by the department,
   45  unless the production spans more than 1 fiscal year, was a
   46  certified production on its first day of principal photography
   47  or project start date in this state, and submits an application
   48  for continuing the same production for the subsequent fiscal
   49  year.
   50         (b) “Digital media project” means a production of
   51  interactive entertainment that is produced for distribution in
   52  commercial or educational markets. The term includes a video
   53  game or production intended for Internet or wireless
   54  distribution, an interactive website, digital animation, and
   55  visual effects, including, but not limited to, three-dimensional
   56  movie productions and movie conversions. The term does not
   57  include a production that contains content that is obscene as
   58  defined in s. 847.001.
   59         (c) “High-impact digital media project” means a digital
   60  media project that has qualified expenditures greater than $4.5
   61  million.
   62         (d) “High-impact television series” means a production
   63  created to run multiple production seasons and having an
   64  estimated order of at least seven episodes per season and
   65  qualified expenditures of at least $625,000 per episode.
   66         (e) “Off-season certified production” means a feature film,
   67  independent film, or television series or pilot that films 75
   68  percent or more of its principal photography days from June 1
   69  through November 30.
   70         (f) “Principal photography” means the filming of major or
   71  significant components of the qualified production which involve
   72  lead actors.
   73         (g) “Production” means a theatrical or direct-to-video
   74  motion picture; a made-for-television motion picture; visual
   75  effects or digital animation sequences produced in conjunction
   76  with a motion picture; a commercial; a music video; an
   77  industrial or educational film; an infomercial; a documentary
   78  film; a television pilot program; a presentation for a
   79  television pilot program; a television series, including, but
   80  not limited to, a drama, a reality show, a comedy, a soap opera,
   81  a telenovela, a game show, an awards show, or a miniseries
   82  production; or a digital media project by the entertainment
   83  industry. One season of a television series is considered one
   84  production. The term does not include a weather or market
   85  program; a sporting event or a sporting event broadcast; a gala;
   86  a production that solicits funds; a home shopping program; a
   87  political program; a political documentary; political
   88  advertising; a gambling-related project or production; a concert
   89  production; a local, regional, or Internet-distributed-only news
   90  show or current-events show; a sports news or sports recap show;
   91  a pornographic production; or any production deemed obscene
   92  under chapter 847. A production may be produced on or by film,
   93  tape, or otherwise by means of a motion picture camera;
   94  electronic camera or device; tape device; computer; any
   95  combination of the foregoing; or any other means, method, or
   96  device.
   97         (h) “Production expenditures” means the costs of tangible
   98  and intangible property used for, and services performed
   99  primarily and customarily in, production, including
  100  preproduction and postproduction, but excluding costs for
  101  development, marketing, and distribution. The term includes, but
  102  is not limited to:
  103         1. Wages, salaries, or other compensation paid to legal
  104  residents of this state, including amounts paid through payroll
  105  service companies, for technical and production crews,
  106  directors, producers, and performers.
  107         2. Net expenditures for sound stages, backlots, production
  108  editing, digital effects, sound recordings, sets, and set
  109  construction.
  110         3. Net expenditures for rental equipment, including, but
  111  not limited to, cameras and grip or electrical equipment.
  112         4. Up to $300,000 of the costs of newly purchased computer
  113  software and hardware unique to the project, including servers,
  114  data processing, and visualization technologies, which are
  115  located in and used exclusively in the state for the production
  116  of digital media.
  117         5. Expenditures for meals, travel, and accommodations. For
  118  purposes of this paragraph, the term “net expenditures” means
  119  the actual amount of money a qualified production spent for
  120  equipment or other tangible personal property, after subtracting
  121  any consideration received for reselling or transferring the
  122  item after the qualified production ends, if applicable.
  123         (i) “Qualified expenditures” means production expenditures
  124  incurred in this state by a qualified production for:
  125         1. Goods purchased or leased from, or services, including,
  126  but not limited to, insurance costs and bonding, payroll
  127  services, and legal fees, which are provided by, a vendor or
  128  supplier in this state that is registered with the Department of
  129  State or the Department of Revenue, has a physical location in
  130  this state, and employs one or more legal residents of this
  131  state. This does not include rebilled goods or services provided
  132  by an in-state company from out-of-state vendors or suppliers.
  133  When services provided by the vendor or supplier include
  134  personal services or labor, only personal services or labor
  135  provided by residents of this state, evidenced by the required
  136  documentation of residency in this state, qualify.
  137         2. Payments to legal residents of this state in the form of
  138  salary, wages, or other compensation up to a maximum of $400,000
  139  per resident unless otherwise specified in subsection (4). A
  140  completed declaration of residency in this state must accompany
  141  the documentation submitted to the office for reimbursement.
  143  For a qualified production involving an event, such as an awards
  144  show, the term does not include expenditures solely associated
  145  with the event itself and not directly required by the
  146  production. The term does not include expenditures incurred
  147  before certification, with the exception of those incurred for a
  148  commercial, a music video, or the pickup of additional episodes
  149  of a high-impact television series within a single season. Under
  150  no circumstances may the qualified production include in the
  151  calculation for qualified expenditures the original purchase
  152  price for equipment or other tangible property that is later
  153  sold or transferred by the qualified production for
  154  consideration. In such cases, the qualified expenditure is the
  155  net of the original purchase price minus the consideration
  156  received upon sale or transfer.
  157         (j) “Qualified production” means a production in this state
  158  meeting the requirements of this section. The term does not
  159  include a production:
  160         1. In which, for the first 2 years of the incentive
  161  program, less than 50 percent, and thereafter, less than 60
  162  percent, of the positions that make up its production cast and
  163  below-the-line production crew, or, in the case of digital media
  164  projects, less than 75 percent of such positions, are filled by
  165  legal residents of this state, whose residency is demonstrated
  166  by a valid Florida driver license or other state-issued
  167  identification confirming residency, or students enrolled full
  168  time in a film-and-entertainment-related course of study at an
  169  institution of higher education in this state; or
  170         2. That contains obscene content as defined in s.
  171  847.001(10).
  172         (k) “Qualified production company” means a corporation,
  173  limited liability company, partnership, or other legal entity
  174  engaged in one or more productions in this state.
  175         (l) “Qualified digital media production facility” means a
  176  building or series of buildings and their improvements in which
  177  data processing, visualization, and sound synchronization
  178  technologies are regularly applied for the production of
  179  qualified digital media projects or the digital animation
  180  components of qualified productions.
  181         (m) “Qualified production facility” means a building or
  182  complex of buildings and their improvements and associated
  183  backlot facilities in which regular filming activity for film or
  184  television has occurred for a period of no less than 1 year and
  185  which contain at least one sound stage of at least 7,800 square
  186  feet.
  187         (n) “Regional population ratio” means the ratio of the
  188  population of a region to the population of this state. The
  189  regional population ratio applicable to a given fiscal year is
  190  the regional population ratio calculated by the Office of Film
  191  and Entertainment using the latest official estimates of
  192  population certified under s. 186.901, available on the first
  193  day of that fiscal year.
  194         (o) “Regional tax credit ratio” means a ratio the numerator
  195  of which is the sum of tax credits awarded to productions in a
  196  region to date plus the tax credits certified, but not yet
  197  awarded, to productions currently in that region and the
  198  denominator of which is the sum of all tax credits awarded in
  199  the state to date plus all tax credits certified, but not yet
  200  awarded, to productions currently in the state. The regional tax
  201  credit ratio applicable to a given year is the regional tax
  202  credit ratio calculated by the Office of Film and Entertainment
  203  using credit award and certification information available on
  204  the first day of that fiscal year.
  205         (p) “Underutilized region” for a given state fiscal year
  206  means a region with a regional tax credit ratio applicable to
  207  that fiscal year that is lower than its regional population
  208  ratio applicable to that fiscal year. The following regions are
  209  established for purposes of making this determination:
  210         1. North Region, consisting of Alachua, Baker, Bay,
  211  Bradford, Calhoun, Clay, Columbia, Dixie, Duval, Escambia,
  212  Franklin, Gadsden, Gilchrist, Gulf, Hamilton, Holmes, Jackson,
  213  Jefferson, Lafayette, Leon, Levy, Liberty, Madison, Nassau,
  214  Okaloosa, Putnam, Santa Rosa, St. Johns, Suwannee, Taylor,
  215  Union, Wakulla, Walton, and Washington Counties.
  216         2. Central East Region, consisting of Brevard, Flagler,
  217  Indian River, Lake, Okeechobee, Orange, Osceola, Seminole, St.
  218  Lucie, and Volusia Counties.
  219         3. Central West Region, consisting of Citrus, Hernando,
  220  Hillsborough, Manatee, Marion, Polk, Pasco, Pinellas, Sarasota,
  221  and Sumter Counties.
  222         4. Southwest Region, consisting of Charlotte, Collier,
  223  DeSoto, Glades, Hardee, Hendry, Highlands, and Lee Counties.
  224         5. Southeast Region, consisting of Broward, Martin, Miami
  225  Dade, Monroe, and Palm Beach Counties.
  226         (n)(q) “Interactive website” means a website or group of
  227  websites that includes interactive and downloadable content, and
  228  creates 25 new Florida full-time equivalent positions operating
  229  from a principal place of business located within Florida. An
  230  interactive website or group of websites must provide
  231  documentation that those jobs were created to the Office of Film
  232  and Entertainment prior to the award of tax credits. Each
  233  subsequent program application must provide proof that 25
  234  Florida full-time equivalent positions are maintained.
  235         (2) CREATION AND PURPOSE OF PROGRAM.—The entertainment
  236  industry financial incentive program is created within the
  237  Office of Film and Entertainment. The purpose of this program is
  238  to encourage the use of this state and all of the counties in
  239  this state as a site for filming, for the digital production of
  240  films, and to develop and sustain the workforce and
  241  infrastructure for film, digital media, and entertainment
  242  production.
  244         (a) Program application.—A qualified production company
  245  producing a qualified production in this state may submit a
  246  program application to the Office of Film and Entertainment for
  247  the purpose of determining qualification for an award of tax
  248  credits authorized by this section no earlier than 180 days
  249  before the first day of principal photography or project start
  250  date in this state. The applicant shall provide the Office of
  251  Film and Entertainment with information required to determine
  252  whether the production is a qualified production and to
  253  determine the qualified expenditures and other information
  254  necessary for the office to determine eligibility for the tax
  255  credit.
  256         (b) Required documentation.—The Office of Film and
  257  Entertainment shall develop an application form for qualifying
  258  an applicant as a qualified production. The form must include,
  259  but need not be limited to, production-related information
  260  concerning employment of residents in this state, a detailed
  261  budget of planned qualified expenditures, and the applicant’s
  262  signed affirmation that the information on the form has been
  263  verified and is correct. The Office of Film and Entertainment
  264  and local film commissions shall distribute the form.
  265         (c) Application process.—The Office of Film and
  266  Entertainment shall establish a process by which an application
  267  is accepted and reviewed and by which tax credit eligibility and
  268  the award amount are determined in conjunction with county
  269  allocations. The Office of Film and Entertainment shall may
  270  request assistance from a duly appointed local film commission
  271  in determining compliance with this section. A certified high
  272  impact television series may submit an initial application for
  273  no more than two successive seasons, notwithstanding the fact
  274  that the successive seasons have not been ordered. The
  275  successive season’s qualified expenditure amounts shall be based
  276  on the current season’s estimated qualified expenditures. Upon
  277  the completion of production of each season, a high-impact
  278  television series may submit an application for no more than one
  279  additional season.
  280         (d) Certification.—The Office of Film and Entertainment
  281  shall review the application within 15 business days after
  282  receipt. Upon its determination that the application contains
  283  all the information required by this subsection and meets the
  284  criteria set out in this section, the Office of Film and
  285  Entertainment shall qualify the applicant and recommend to the
  286  department that the applicant be certified for the maximum tax
  287  credit award amount per qualifying county. Within 5 business
  288  days after receipt of the recommendation, the department shall
  289  reject the recommendation or certify the maximum recommended tax
  290  credit award, if any, to the applicant, to the applicable local
  291  film commissions, and to the executive director of the
  292  Department of Revenue.
  293         (e) Grounds for denial.—The Office of Film and
  294  Entertainment shall deny an application if it determines that
  295  the application is not complete or the production or application
  296  does not meet the requirements of this section. Within 90 days
  297  after submitting a program application, except with respect to
  298  applications in the independent and emerging media queue, a
  299  production must provide proof of project financing to the Office
  300  of Film and Entertainment, otherwise the project is deemed
  301  denied and withdrawn. A project that has been withdrawn may
  302  submit a new application upon providing the Office of Film and
  303  Entertainment proof of financing.
  304         (f) Verification of actual qualified expenditures.—
  305         1. The Office of Film and Entertainment shall develop a
  306  process to verify the actual qualified expenditures of a
  307  certified production. The process must require:
  308         a. A certified production to submit, in a timely manner
  309  after production ends in this state and after making all of its
  310  qualified expenditures in this state, data substantiating each
  311  qualified expenditure, including documentation on the net
  312  expenditure on equipment and other tangible personal property by
  313  the qualified production, to an independent certified public
  314  accountant licensed in this state;
  315         b. Such accountant to conduct a compliance audit, at the
  316  certified production’s expense, to substantiate each qualified
  317  expenditure and submit the results as a report, along with the
  318  required substantiating data, to the Office of Film and
  319  Entertainment; and
  320         c. The Office of Film and Entertainment to review the
  321  accountant’s submittal and report to the department the final
  322  verified amount of actual qualified expenditures made by the
  323  certified production.
  324         2. The department shall determine and approve the final tax
  325  credit award amount to each certified applicant based on the
  326  final verified amount of actual qualified expenditures and shall
  327  notify the executive director of the Department of Revenue in
  328  writing that the certified production has met the requirements
  329  of the incentive program and of the final amount of the tax
  330  credit award. The final tax credit award amount may not exceed
  331  the maximum tax credit award amount certified under paragraph
  332  (d).
  333         (g) Promoting Florida.—The Office of Film and Entertainment
  334  shall ensure that, as a condition of receiving a tax credit
  335  under this section, marketing materials promoting this state as
  336  a tourist destination or film and entertainment production
  337  destination are included, when appropriate, at no cost to the
  338  state, which must, at a minimum, include placement of a “Filmed
  339  in Florida” or “Produced in Florida” logo in the end credits and
  340  a list of the cities, towns, and counties where filming
  341  occurred. The placement of a “Filmed in Florida” or “Produced in
  342  Florida” logo on all packaging material and hard media is also
  343  required, unless such placement is prohibited by licensing or
  344  other contractual obligations. The size and placement of such
  345  logo shall be commensurate to other logos used. If no logos are
  346  used, the statement “Filmed in Florida using Florida’s
  347  Entertainment Industry Financial Incentive,” or a similar
  348  statement approved by the Office of Film and Entertainment,
  349  shall be used. The Office of Film and Entertainment shall
  350  provide a logo and supply it for the purposes specified in this
  351  paragraph. A 30-second “Visit Florida” promotional video must
  352  also be included on all optical disc formats of a film, unless
  353  such placement is prohibited by licensing or other contractual
  354  obligations. The 30-second promotional video shall be approved
  355  and provided by the Florida Tourism Industry Marketing
  356  Corporation in consultation with the Commissioner of Film and
  357  Entertainment.
  362         (a) Priority for tax credit award.—The priority of a
  363  qualified production for tax credit awards must be determined
  364  by:
  365         1. The highest percentage of production filmed and produced
  366  in this state or the highest projected positive fiscal impact
  367  for this state; and
  368         2. The availability of unencumbered funds on a first-come,
  369  first-served basis within its appropriate queue. Each qualified
  370  production must be placed into the appropriate queue and is
  371  subject to the requirements of that queue.
  372         (b) Tax credit eligibility.—
  373         1. General production queue.—Ninety-four percent of tax
  374  credits authorized pursuant to subsection (6) in any state
  375  fiscal year must be dedicated to the general production queue.
  376  The general production queue consists of all qualified
  377  productions other than those eligible for the commercial and
  378  music video queue or the independent and emerging media
  379  production queue. A qualified production that demonstrates a
  380  minimum of $625,000 in qualified expenditures is eligible for
  381  tax credits equal to up to 35 percent 20 percent of its actual
  382  qualified expenditures or $8 million, whichever is less,
  383  determined by film commission offices in the counties where
  384  production will take place up to a maximum of $8 million. A
  385  qualified production that incurs qualified expenditures during
  386  multiple state fiscal years may combine those expenditures to
  387  satisfy the $625,000 minimum threshold.
  388         a. An off-season certified production that is a feature
  389  film, independent film, or television series or pilot is
  390  eligible for an additional 5 percent tax credit on actual
  391  qualified expenditures, but such tax credit may not cause the
  392  qualified production to exceed the 35 percent tax credit cap
  393  prescribed in subparagraph 1. An off-season certified production
  394  that does not complete 75 percent of principal photography due
  395  to a disruption caused by a hurricane or tropical storm may not
  396  be disqualified from eligibility for the additional 5 percent
  397  credit as a result of the disruption.
  398         b. If more than 45 percent of the sum of total tax credits
  399  initially certified and awarded after April 1, 2012, total tax
  400  credits initially certified after April 1, 2012, but not yet
  401  awarded, and total tax credits available for certification after
  402  April 1, 2012, but not yet certified has been awarded for high
  403  impact television series, then no high-impact television series
  404  is eligible for tax credits under this subparagraph. Tax credits
  405  initially certified for a high-impact television series after
  406  April 1, 2012, may not be awarded if the award will cause the
  407  percentage threshold in this sub-subparagraph to be exceeded.
  408  This sub-subparagraph does not prohibit the award of tax credits
  409  certified before April 1, 2012, for high-impact television
  410  series.
  411         c. Subject to sub-subparagraph b., first priority in the
  412  queue for tax credit awards not yet certified shall be given to
  413  high-impact television series and high-impact digital media
  414  projects. For the purposes of determining priority between a
  415  high-impact television series and a high-impact digital media
  416  project, the first position must go to the first application
  417  received. Thereafter, priority shall be determined by
  418  alternating between a high-impact television series and a high
  419  impact digital media project on a first-come, first-served
  420  basis. However, if the Office of Film and Entertainment receives
  421  an application for a high-impact television series or high
  422  impact digital media project that would be certified but for the
  423  alternating priority, the office may certify the project as
  424  being in the priority position if an application that would
  425  normally be the priority position is not received within 5
  426  business days.
  427         d. A qualified production for which at least 67 percent of
  428  its principal photography days occur within a region designated
  429  as an underutilized region at the time that the production is
  430  certified is eligible for an additional 5 percent tax credit.
  431         d.e. A qualified production that employs students enrolled
  432  full-time in a film and entertainment-related or digital media
  433  related course of study at an institution of higher education in
  434  this state is eligible for an additional 45 15 percent tax
  435  credit on qualified expenditures that are wages, salaries, or
  436  other compensation paid to such students, not to exceed a
  437  combined total of 38 percent of all qualified expenditures. The
  438  additional 45 15 percent tax credit is also applicable to
  439  persons hired within 12 months after graduating from a film and
  440  entertainment-related or digital media-related course of study
  441  at an institution of higher education in this state. The
  442  additional 45 15 percent tax credit applies to qualified
  443  expenditures that are wages, salaries, or other compensation
  444  paid to such recent graduates for 1 year after the date of
  445  hiring.
  446         e.f. A qualified production for which 50 percent or more of
  447  its principal photography occurs at a qualified production
  448  facility, or a qualified digital media project or the digital
  449  animation component of a qualified production for which 50
  450  percent or more of the project’s or component’s qualified
  451  expenditures are related to a qualified digital media production
  452  facility, is eligible for an additional 5 percent tax credit on
  453  actual qualified expenditures, not to exceed a combined total of
  454  38 percent of all qualified expenditures for production activity
  455  at that facility.
  456         f.g. A qualified production is not eligible for tax credits
  457  provided under this paragraph totaling more than 38 30 percent
  458  of its actual qualified expenses.
  459         2. Commercial and music video queue.—Three percent of tax
  460  credits authorized pursuant to subsection (6) in any state
  461  fiscal year must be dedicated to the commercial and music video
  462  queue. A qualified production company that produces national or
  463  regional commercials or music videos may be eligible for a tax
  464  credit award if it demonstrates a minimum of $100,000 in
  465  qualified expenditures per national or regional commercial or
  466  music video and exceeds a combined threshold of $500,000 after
  467  combining actual qualified expenditures from qualified
  468  commercials and music videos during a single state fiscal year.
  469  After a qualified production company that produces commercials,
  470  music videos, or both reaches the threshold of $500,000, it is
  471  eligible to apply for certification for a tax credit award. The
  472  maximum credit award shall be equal to 20 percent of its actual
  473  qualified expenditures up to a maximum of $500,000. If there is
  474  a surplus at the end of a fiscal year after the Office of Film
  475  and Entertainment certifies and determines the tax credits for
  476  all qualified commercial and video projects, such surplus tax
  477  credits shall be carried forward to the following fiscal year
  478  and are available to any eligible qualified productions under
  479  the general production queue.
  480         3. Independent and emerging media production queue.—Three
  481  percent of tax credits authorized pursuant to subsection (6) in
  482  any state fiscal year must be dedicated to the independent and
  483  emerging media production queue. This queue is intended to
  484  encourage independent film and emerging media production in this
  485  state. Any qualified production, excluding commercials,
  486  infomercials, or music videos, which demonstrates at least
  487  $20,000 $100,000, but not more than $625,000, in total qualified
  488  expenditures is eligible for tax credits equal to up to 30 equal
  489  to 20 percent of its actual qualified expenditures, determined
  490  by the local film commission in the county where the production
  491  takes place. If a surplus exists at the end of a fiscal year
  492  after the Office of Film and Entertainment certifies and
  493  determines the tax credits for all qualified independent and
  494  emerging media production projects, such surplus tax credits
  495  shall be carried forward to the following fiscal year and are
  496  available to any eligible qualified productions under the
  497  general production queue.
  498         4. Family-friendly productions.—A certified theatrical or
  499  direct-to-video motion picture production or video game
  500  determined by the Commissioner of Film and Entertainment, with
  501  the advice of the Florida Film and Entertainment Advisory
  502  Council, to be family-friendly, based on review of the script
  503  and review of the final release version, is eligible for an
  504  additional tax credit equal to 5 percent of its actual qualified
  505  expenditures. Family-friendly productions are those that have
  506  cross-generational appeal; would be considered suitable for
  507  viewing by children age 5 or older; are appropriate in theme,
  508  content, and language for a broad family audience; embody a
  509  responsible resolution of issues; and do not exhibit or imply
  510  any act of smoking, sex, nudity, or vulgar or profane language.
  511         (c) Withdrawal of tax credit eligibility.—A qualified or
  512  certified production must continue on a reasonable schedule,
  513  which includes beginning principal photography or the production
  514  project in this state no more than 45 calendar days before or
  515  after the principal photography or project start date provided
  516  in the production’s program application. The department shall
  517  withdraw the eligibility of a qualified or certified production
  518  that does not continue on a reasonable schedule.
  519         (d) Election and distribution of tax credits.—
  520         1. A certified production company receiving a tax credit
  521  award under this section shall, at the time the credit is
  522  awarded by the department after production is completed and all
  523  requirements to receive a credit award have been met, make an
  524  irrevocable election to apply the credit against taxes due under
  525  chapter 220, against state taxes collected or accrued under
  526  chapter 212, or against a stated combination of the two taxes.
  527  The election is binding upon any distributee, successor,
  528  transferee, or purchaser. The department shall notify the
  529  Department of Revenue of any election made pursuant to this
  530  paragraph.
  531         2. A qualified production company is eligible for tax
  532  credits against its sales and use tax liabilities and corporate
  533  income tax liabilities as provided in this section. However, tax
  534  credits awarded under this section may not be claimed against
  535  sales and use tax liabilities or corporate income tax
  536  liabilities for any tax period beginning before July 1, 2011,
  537  regardless of when the credits are applied for or awarded.
  538         (e) Tax credit carryforward.—If the certified production
  539  company cannot use the entire tax credit in the taxable year or
  540  reporting period in which the credit is awarded, any excess
  541  amount may be carried forward to a succeeding taxable year or
  542  reporting period. A tax credit applied against taxes imposed
  543  under chapter 212 may be carried forward for a maximum of 5
  544  years after the date the credit is awarded. A tax credit applied
  545  against taxes imposed under chapter 220 may be carried forward
  546  for a maximum of 5 years after the date the credit is awarded,
  547  after which the credit expires and may not be used.
  548         (f) Consolidated returns.—A certified production company
  549  that files a Florida consolidated return as a member of an
  550  affiliated group under s. 220.131(1) may be allowed the credit
  551  on a consolidated return basis up to the amount of the tax
  552  imposed upon the consolidated group under chapter 220.
  553         (g) Partnership and noncorporate distributions.—A qualified
  554  production company that is not a corporation as defined in s.
  555  220.03 may elect to distribute tax credits awarded under this
  556  section to its partners or members in proportion to their
  557  respective distributive income or loss in the taxable year in
  558  which the tax credits were awarded.
  559         (h) Mergers or acquisitions.—Tax credits available under
  560  this section to a certified production company may succeed to a
  561  surviving or acquiring entity subject to the same conditions and
  562  limitations as described in this section; however, they may not
  563  be transferred again by the surviving or acquiring entity.
  564         (5) TRANSFER OF TAX CREDITS.—
  565         (a) Authorization.—Upon application to the Office of Film
  566  and Entertainment and approval by the department, a certified
  567  production company, or a partner or member that has received a
  568  distribution under paragraph (4)(g), may elect to transfer, in
  569  whole or in part, any unused credit amount granted under this
  570  section. An election to transfer any unused tax credit amount
  571  under chapter 212 or chapter 220 must be made no later than 5
  572  years after the date the credit is awarded, after which period
  573  the credit expires and may not be used. The department shall
  574  notify the Department of Revenue of the election and transfer.
  575         (b) Number of transfers permitted.—A certified production
  576  company that elects to apply a credit amount against taxes
  577  remitted under chapter 212 is permitted a one-time transfer of
  578  unused credits to one transferee. A certified production company
  579  that elects to apply a credit amount against taxes due under
  580  chapter 220 is permitted a one-time transfer of unused credits
  581  to no more than four transferees, and such transfers must occur
  582  in the same taxable year.
  583         (c) Transferee rights and limitations.—The transferee is
  584  subject to the same rights and limitations as the certified
  585  production company awarded the tax credit, except that the
  586  initial transferee shall be permitted a one-time transfer of
  587  unused credits to no more than two subsequent transferees, and
  588  such transfers must occur in the same taxable year as the
  589  credits were received by the initial transferee, after which the
  590  subsequent transferees may not sell or otherwise transfer the
  591  tax credit.
  593         (a) Beginning July 1, 2019 2011, a certified production
  594  company, or any person who has acquired a tax credit from a
  595  certified production company pursuant to subsections (4) and
  596  (5), may elect to relinquish the tax credit to the Department of
  597  Revenue in exchange for 90 percent of the amount of the
  598  relinquished tax credit.
  599         (b) The Department of Revenue may approve payments to
  600  persons relinquishing tax credits pursuant to this subsection.
  601         (c) Subject to legislative appropriation, the Department of
  602  Revenue shall request the Chief Financial Officer to issue
  603  warrants to persons relinquishing tax credits. Payments under
  604  this subsection shall be made from the funds from which the
  605  proceeds from the taxes against which the tax credits could have
  606  been applied pursuant to the irrevocable election made by the
  607  certified production company under subsection (4) are deposited.
  609         (a) The aggregate amount of the tax credits that may be
  610  certified pursuant to paragraph (3)(d) may not exceed $36
  611  million per fiscal year.:
  612         1. The county for each House of Representatives district
  613  must be allocated $300,000 on a pro rata basis based on the
  614  percentage of the district located within the county For fiscal
  615  year 2010-2011, $53.5 million.
  616         2. A county film commission office may negotiate with a
  617  potential certified production company as to the percentage of
  618  the total tax credits awarded it receives, pending approval from
  619  the Office of Film and Entertainment and not to exceed 35
  620  percent of the production company’s qualified expenditures For
  621  fiscal year 2011-2012, $74.5 million.
  622         3. For fiscal years 2012-2013, 2013-2014, 2014-2015, and
  623  2015-2016, $42 million per fiscal year.
  624         (b) Any portion of the maximum amount of tax credits
  625  established per fiscal year in paragraph (a) which that is not
  626  certified as of the end of a fiscal year must shall be carried
  627  forward and made available for certification during the
  628  following 2 fiscal years, in addition to the amounts available
  629  for certification under paragraph (a) for those fiscal years.
  630  Any allocations assigned to a county which are not encumbered by
  631  March 1 of the year in which the allocations were assigned may
  632  be available to all counties with priority based on a project
  633  rating decided by the Office of Film and Entertainment.
  634         (c) Upon approval of the final tax credit award amount
  635  pursuant to subparagraph (3)(f)2., an amount equal to the
  636  difference between the maximum tax credit award amount
  637  previously certified under paragraph (3)(d) and the approved
  638  final tax credit award amount shall immediately be available for
  639  recertification during the current and following fiscal years in
  640  addition to the amounts available for certification under
  641  paragraph (a) for those fiscal years.
  642         (d) If, during a fiscal year, the total amount of credits
  643  applied for, pursuant to paragraph (3)(a), exceeds the amount of
  644  credits available for certification in that fiscal year, such
  645  excess shall be treated as having been applied for on the first
  646  day of the next fiscal year in which credits remain available
  647  for certification.
  649         (a) The department may adopt rules pursuant to ss.
  650  120.536(1) and 120.54 and develop policies and procedures to
  651  implement and administer this section, including, but not
  652  limited to, rules specifying requirements for the application
  653  and approval process, records required for substantiation for
  654  tax credits, procedures for making the election in paragraph
  655  (4)(d), the manner and form of documentation required to claim
  656  tax credits awarded or transferred under this section, and
  657  marketing requirements for tax credit recipients.
  658         (b) The Department of Revenue may adopt rules pursuant to
  659  ss. 120.536(1) and 120.54 to administer this section, including
  660  rules governing the examination and audit procedures required to
  661  administer this section and the manner and form of documentation
  662  required to claim tax credits awarded, transferred, or
  663  relinquished under this section.
  666         (a) Audit authority.—The Department of Revenue may conduct
  667  examinations and audits as provided in s. 213.34 to verify that
  668  tax credits under this section are received, transferred, and
  669  applied according to the requirements of this section. If the
  670  Department of Revenue determines that tax credits are not
  671  received, transferred, or applied as required by this section,
  672  it may, in addition to the remedies provided in this subsection,
  673  pursue recovery of such funds pursuant to the laws and rules
  674  governing the assessment of taxes.
  675         (b) Revocation of tax credits.—The department may revoke or
  676  modify any written decision qualifying, certifying, or otherwise
  677  granting eligibility for tax credits under this section if it is
  678  discovered that the tax credit applicant submitted any false
  679  statement, representation, or certification in any application,
  680  record, report, plan, or other document filed in an attempt to
  681  receive tax credits under this section. The department shall
  682  immediately notify the Department of Revenue of any revoked or
  683  modified orders affecting previously granted tax credits.
  684  Additionally, the applicant must notify the Department of
  685  Revenue of any change in its tax credit claimed.
  686         (c) Forfeiture of tax credits.—A determination by the
  687  Department of Revenue, as a result of an audit pursuant to
  688  paragraph (a) or from information received from the Office of
  689  Film and Entertainment, that an applicant received tax credits
  690  pursuant to this section to which the applicant was not entitled
  691  is grounds for forfeiture of previously claimed and received tax
  692  credits. The applicant is responsible for returning forfeited
  693  tax credits to the Department of Revenue, and such funds shall
  694  be paid into the General Revenue Fund of the state. Tax credits
  695  purchased in good faith are not subject to forfeiture unless the
  696  transferee submitted fraudulent information in the purchase or
  697  failed to meet the requirements in subsection (5).
  698         (d) Fraudulent claims.—Any applicant that submits
  699  fraudulent information under this section is liable for
  700  reimbursement of the reasonable costs and fees associated with
  701  the review, processing, investigation, and prosecution of the
  702  fraudulent claim. An applicant that obtains a credit payment
  703  under this section through a claim that is fraudulent is liable
  704  for reimbursement of the credit amount plus a penalty in an
  705  amount double the credit amount. The penalty is in addition to
  706  any criminal penalty to which the applicant is liable for the
  707  same acts. The applicant is also liable for costs and fees
  708  incurred by the state in investigating and prosecuting the
  709  fraudulent claim.
  710         (10) ANNUAL REPORT.—Each November 1, the Office of Film and
  711  Entertainment shall submit an annual report for the previous
  712  fiscal year to the Governor, the President of the Senate, and
  713  the Speaker of the House of Representatives which outlines the
  714  incentive program’s return on investment and economic benefits
  715  to the state. The report must also include an estimate of the
  716  full-time equivalent positions created by each production that
  717  received tax credits under this section and information relating
  718  to the distribution of productions receiving credits by
  719  geographic region and type of production. The report must also
  720  include the expenditures report required under s. 288.1253(3)
  721  and the information describing the relationship between tax
  722  exemptions and incentives to industry growth required under s.
  723  288.1258(5).
  724         (11) REPEAL.—This section is repealed July 1, 2024 2016,
  725  except that:
  726         (a) Tax credits certified under paragraph (3)(d) before
  727  July 1, 2024 2016, may be awarded under paragraph (3)(f) on or
  728  after July 1, 2024 2016, if the other requirements of this
  729  section are met.
  730         (b) Tax credits carried forward under paragraph (4)(e)
  731  remain valid for the period specified.
  732         (c) Subsections (5), (8) and (9) shall remain in effect
  733  until July 1, 2029 2021.
  734         Section 2. This act shall take effect July 1, 2019.