Florida Senate - 2019                                    SB 1750
       By Senator Taddeo
       40-01321-19                                           20191750__
    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         capping the amount of tax credits which may be
    7         certified per fiscal year; deleting the scheduled
    8         repeal of the program; providing an effective date.
   10  Be It Enacted by the Legislature of the State of Florida:
   12         Section 1. Notwithstanding the scheduled repeal of section
   13  288.1254, Florida Statutes, in section 15 of chapter 2012-32,
   14  Laws of Florida, section 288.1254, Florida Statutes, is revived,
   15  readopted, and amended to read:
   16         288.1254 Entertainment industry financial incentive
   17  program.—
   18         (1) DEFINITIONS.—As used in this section, the term:
   19         (a) “Certified production” means a qualified production
   20  that has tax credits allocated to it by the department based on
   21  the production’s estimated qualified expenditures, up to the
   22  production’s maximum certified amount of tax credits, by the
   23  department. The term does not include a production if its first
   24  day of principal photography or project start date in this state
   25  occurs before the production is certified by the department,
   26  unless the production spans more than 1 fiscal year, was a
   27  certified production on its first day of principal photography
   28  or project start date in this state, and submits an application
   29  for continuing the same production for the subsequent fiscal
   30  year.
   31         (b) “Digital media project” means a production of
   32  interactive entertainment that is produced for distribution in
   33  commercial or educational markets. The term includes a video
   34  game or production intended for Internet or wireless
   35  distribution, an interactive website, digital animation, and
   36  visual effects, including, but not limited to, three-dimensional
   37  movie productions and movie conversions. The term does not
   38  include a production that contains content that is obscene as
   39  defined in s. 847.001.
   40         (c) “High-impact digital media project” means a digital
   41  media project that has qualified expenditures greater than $4.5
   42  million.
   43         (d) “High-impact television series” means a production
   44  created to run multiple production seasons and having an
   45  estimated order of at least seven episodes per season and
   46  qualified expenditures of at least $625,000 per episode.
   47         (e) “Off-season certified production” means a feature film,
   48  independent film, or television series or pilot that films 75
   49  percent or more of its principal photography days from June 1
   50  through November 30.
   51         (f) “Principal photography” means the filming of major or
   52  significant components of the qualified production which involve
   53  lead actors.
   54         (g) “Production” means a theatrical or direct-to-video
   55  motion picture; a made-for-television motion picture; visual
   56  effects or digital animation sequences produced in conjunction
   57  with a motion picture; a commercial; a music video; an
   58  industrial or educational film; an infomercial; a documentary
   59  film; a television pilot program; a presentation for a
   60  television pilot program; a television series, including, but
   61  not limited to, a drama, a reality show, a comedy, a soap opera,
   62  a telenovela, a game show, an awards show, or a miniseries
   63  production; or a digital media project by the entertainment
   64  industry. One season of a television series is considered one
   65  production. The term does not include a weather or market
   66  program; a sporting event or a sporting event broadcast; a gala;
   67  a production that solicits funds; a home shopping program; a
   68  political program; a political documentary; political
   69  advertising; a gambling-related project or production; a concert
   70  production; a local, regional, or Internet-distributed-only news
   71  show or current-events show; a sports news or sports recap show;
   72  a pornographic production; or any production deemed obscene
   73  under chapter 847. A production may be produced on or by film,
   74  tape, or otherwise by means of a motion picture camera;
   75  electronic camera or device; tape device; computer; any
   76  combination of the foregoing; or any other means, method, or
   77  device.
   78         (h) “Production expenditures” means the costs of tangible
   79  and intangible property used for, and services performed
   80  primarily and customarily in, production, including
   81  preproduction and postproduction, but excluding costs for
   82  development, marketing, and distribution. The term includes, but
   83  is not limited to:
   84         1. Wages, salaries, or other compensation paid to legal
   85  residents of this state, including amounts paid through payroll
   86  service companies, for technical and production crews,
   87  directors, producers, and performers.
   88         2. Net expenditures for sound stages, backlots, production
   89  editing, digital effects, sound recordings, sets, and set
   90  construction.
   91         3. Net expenditures for rental equipment, including, but
   92  not limited to, cameras and grip or electrical equipment.
   93         4. Up to $300,000 of the costs of newly purchased computer
   94  software and hardware unique to the project, including servers,
   95  data processing, and visualization technologies, which are
   96  located in and used exclusively in the state for the production
   97  of digital media.
   98         5. Expenditures for meals, travel, and accommodations. For
   99  purposes of this paragraph, the term “net expenditures” means
  100  the actual amount of money a qualified production spent for
  101  equipment or other tangible personal property, after subtracting
  102  any consideration received for reselling or transferring the
  103  item after the qualified production ends, if applicable.
  104         (i) “Qualified expenditures” means production expenditures
  105  incurred in this state by a qualified production for:
  106         1. Goods purchased or leased from, or services, including,
  107  but not limited to, insurance costs and bonding, payroll
  108  services, and legal fees, which are provided by, a vendor or
  109  supplier in this state that is registered with the Department of
  110  State or the Department of Revenue, has a physical location in
  111  this state, and employs one or more legal residents of this
  112  state. This does not include rebilled goods or services provided
  113  by an in-state company from out-of-state vendors or suppliers.
  114  When services provided by the vendor or supplier include
  115  personal services or labor, only personal services or labor
  116  provided by residents of this state, evidenced by the required
  117  documentation of residency in this state, qualify.
  118         2. Payments to legal residents of this state in the form of
  119  salary, wages, or other compensation up to a maximum of $400,000
  120  per resident unless otherwise specified in subsection (4). A
  121  completed declaration of residency in this state must accompany
  122  the documentation submitted to the office for reimbursement.
  124  For a qualified production involving an event, such as an awards
  125  show, the term does not include expenditures solely associated
  126  with the event itself and not directly required by the
  127  production. The term does not include expenditures incurred
  128  before certification, with the exception of those incurred for a
  129  commercial, a music video, or the pickup of additional episodes
  130  of a high-impact television series within a single season. Under
  131  no circumstances may the qualified production include in the
  132  calculation for qualified expenditures the original purchase
  133  price for equipment or other tangible property that is later
  134  sold or transferred by the qualified production for
  135  consideration. In such cases, the qualified expenditure is the
  136  net of the original purchase price minus the consideration
  137  received upon sale or transfer.
  138         (j) “Qualified production” means a production in this state
  139  meeting the requirements of this section. The term does not
  140  include a production:
  141         1. In which, for the first 2 years of the incentive
  142  program, less than 50 percent, and thereafter, less than 60
  143  percent, of the positions that make up its production cast and
  144  below-the-line production crew, or, in the case of digital media
  145  projects, less than 75 percent of such positions, are filled by
  146  legal residents of this state, whose residency is demonstrated
  147  by a valid Florida driver license or other state-issued
  148  identification confirming residency, or students enrolled full
  149  time in a film-and-entertainment-related course of study at an
  150  institution of higher education in this state; or
  151         2. That contains obscene content as defined in s.
  152  847.001(10).
  153         (k) “Qualified production company” means a corporation,
  154  limited liability company, partnership, or other legal entity
  155  engaged in one or more productions in this state.
  156         (l) “Qualified digital media production facility” means a
  157  building or series of buildings and their improvements in which
  158  data processing, visualization, and sound synchronization
  159  technologies are regularly applied for the production of
  160  qualified digital media projects or the digital animation
  161  components of qualified productions.
  162         (m) “Qualified production facility” means a building or
  163  complex of buildings and their improvements and associated
  164  backlot facilities in which regular filming activity for film or
  165  television has occurred for a period of no less than 1 year and
  166  which contain at least one sound stage of at least 7,800 square
  167  feet.
  168         (n) “Regional population ratio” means the ratio of the
  169  population of a region to the population of this state. The
  170  regional population ratio applicable to a given fiscal year is
  171  the regional population ratio calculated by the Office of Film
  172  and Entertainment using the latest official estimates of
  173  population certified under s. 186.901, available on the first
  174  day of that fiscal year.
  175         (o) “Regional tax credit ratio” means a ratio the numerator
  176  of which is the sum of tax credits awarded to productions in a
  177  region to date plus the tax credits certified, but not yet
  178  awarded, to productions currently in that region and the
  179  denominator of which is the sum of all tax credits awarded in
  180  the state to date plus all tax credits certified, but not yet
  181  awarded, to productions currently in the state. The regional tax
  182  credit ratio applicable to a given year is the regional tax
  183  credit ratio calculated by the Office of Film and Entertainment
  184  using credit award and certification information available on
  185  the first day of that fiscal year.
  186         (p) “Underutilized region” for a given state fiscal year
  187  means a region with a regional tax credit ratio applicable to
  188  that fiscal year that is lower than its regional population
  189  ratio applicable to that fiscal year. The following regions are
  190  established for purposes of making this determination:
  191         1. North Region, consisting of Alachua, Baker, Bay,
  192  Bradford, Calhoun, Clay, Columbia, Dixie, Duval, Escambia,
  193  Franklin, Gadsden, Gilchrist, Gulf, Hamilton, Holmes, Jackson,
  194  Jefferson, Lafayette, Leon, Levy, Liberty, Madison, Nassau,
  195  Okaloosa, Putnam, Santa Rosa, St. Johns, Suwannee, Taylor,
  196  Union, Wakulla, Walton, and Washington Counties.
  197         2. Central East Region, consisting of Brevard, Flagler,
  198  Indian River, Lake, Okeechobee, Orange, Osceola, Seminole, St.
  199  Lucie, and Volusia Counties.
  200         3. Central West Region, consisting of Citrus, Hernando,
  201  Hillsborough, Manatee, Marion, Polk, Pasco, Pinellas, Sarasota,
  202  and Sumter Counties.
  203         4. Southwest Region, consisting of Charlotte, Collier,
  204  DeSoto, Glades, Hardee, Hendry, Highlands, and Lee Counties.
  205         5. Southeast Region, consisting of Broward, Martin, Miami
  206  Dade, Monroe, and Palm Beach Counties.
  207         (q) “Interactive website” means a website or group of
  208  websites that includes interactive and downloadable content, and
  209  creates 25 new Florida full-time equivalent positions operating
  210  from a principal place of business located within Florida. An
  211  interactive website or group of websites must provide
  212  documentation that those jobs were created to the Office of Film
  213  and Entertainment prior to the award of tax credits. Each
  214  subsequent program application must provide proof that 25
  215  Florida full-time equivalent positions are maintained.
  216         (2) CREATION AND PURPOSE OF PROGRAM.—The entertainment
  217  industry financial incentive program is created within the
  218  Office of Film and Entertainment. The purpose of this program is
  219  to encourage the use of this state as a site for filming, for
  220  the digital production of films, and to develop and sustain the
  221  workforce and infrastructure for film, digital media, and
  222  entertainment production.
  224         (a) Program application.—A qualified production company
  225  producing a qualified production in this state may submit a
  226  program application to the Office of Film and Entertainment for
  227  the purpose of determining qualification for an award of tax
  228  credits authorized by this section no earlier than 180 days
  229  before the first day of principal photography or project start
  230  date in this state. The applicant shall provide the Office of
  231  Film and Entertainment with information required to determine
  232  whether the production is a qualified production and to
  233  determine the qualified expenditures and other information
  234  necessary for the office to determine eligibility for the tax
  235  credit.
  236         (b) Required documentation.—The Office of Film and
  237  Entertainment shall develop an application form for qualifying
  238  an applicant as a qualified production. The form must include,
  239  but need not be limited to, production-related information
  240  concerning employment of residents in this state, a detailed
  241  budget of planned qualified expenditures, and the applicant’s
  242  signed affirmation that the information on the form has been
  243  verified and is correct. The Office of Film and Entertainment
  244  and local film commissions shall distribute the form.
  245         (c) Application process.—The Office of Film and
  246  Entertainment shall establish a process by which an application
  247  is accepted and reviewed and by which tax credit eligibility and
  248  award amount are determined. The Office of Film and
  249  Entertainment may request assistance from a duly appointed local
  250  film commission in determining compliance with this section. A
  251  certified high-impact television series may submit an initial
  252  application for no more than two successive seasons,
  253  notwithstanding the fact that the successive seasons have not
  254  been ordered. The successive season’s qualified expenditure
  255  amounts shall be based on the current season’s estimated
  256  qualified expenditures. Upon the completion of production of
  257  each season, a high-impact television series may submit an
  258  application for no more than one additional season.
  259         (d) Certification.—The Office of Film and Entertainment
  260  shall review the application within 15 business days after
  261  receipt. Upon its determination that the application contains
  262  all the information required by this subsection and meets the
  263  criteria set out in this section, the Office of Film and
  264  Entertainment shall qualify the applicant and recommend to the
  265  department that the applicant be certified for the maximum tax
  266  credit award amount. Within 5 business days after receipt of the
  267  recommendation, the department shall reject the recommendation
  268  or certify the maximum recommended tax credit award, if any, to
  269  the applicant and to the executive director of the Department of
  270  Revenue.
  271         (e) Grounds for denial.—The Office of Film and
  272  Entertainment shall deny an application if it determines that
  273  the application is not complete or the production or application
  274  does not meet the requirements of this section. Within 90 days
  275  after submitting a program application, except with respect to
  276  applications in the independent and emerging media queue, a
  277  production must provide proof of project financing to the Office
  278  of Film and Entertainment, otherwise the project is deemed
  279  denied and withdrawn. A project that has been withdrawn may
  280  submit a new application upon providing the Office of Film and
  281  Entertainment proof of financing.
  282         (f) Verification of actual qualified expenditures.—
  283         1. The Office of Film and Entertainment shall develop a
  284  process to verify the actual qualified expenditures of a
  285  certified production. The process must require:
  286         a. A certified production to submit, in a timely manner
  287  after production ends in this state and after making all of its
  288  qualified expenditures in this state, data substantiating each
  289  qualified expenditure, including documentation on the net
  290  expenditure on equipment and other tangible personal property by
  291  the qualified production, to an independent certified public
  292  accountant licensed in this state;
  293         b. Such accountant to conduct a compliance audit, at the
  294  certified production’s expense, to substantiate each qualified
  295  expenditure and submit the results as a report, along with the
  296  required substantiating data, to the Office of Film and
  297  Entertainment; and
  298         c. The Office of Film and Entertainment to review the
  299  accountant’s submittal and report to the department the final
  300  verified amount of actual qualified expenditures made by the
  301  certified production.
  302         2. The department shall determine and approve the final tax
  303  credit award amount to each certified applicant based on the
  304  final verified amount of actual qualified expenditures and shall
  305  notify the executive director of the Department of Revenue in
  306  writing that the certified production has met the requirements
  307  of the incentive program and of the final amount of the tax
  308  credit award. The final tax credit award amount may not exceed
  309  the maximum tax credit award amount certified under paragraph
  310  (d).
  311         (g) Promoting Florida.—The Office of Film and Entertainment
  312  shall ensure that, as a condition of receiving a tax credit
  313  under this section, marketing materials promoting this state as
  314  a tourist destination or film and entertainment production
  315  destination are included, when appropriate, at no cost to the
  316  state, which must, at a minimum, include placement of a “Filmed
  317  in Florida” or “Produced in Florida” logo in the end credits.
  318  The placement of a “Filmed in Florida” or “Produced in Florida”
  319  logo on all packaging material and hard media is also required,
  320  unless such placement is prohibited by licensing or other
  321  contractual obligations. The size and placement of such logo
  322  shall be commensurate to other logos used. If no logos are used,
  323  the statement “Filmed in Florida using Florida’s Entertainment
  324  Industry Financial Incentive,” or a similar statement approved
  325  by the Office of Film and Entertainment, shall be used. The
  326  Office of Film and Entertainment shall provide a logo and supply
  327  it for the purposes specified in this paragraph. A 30-second
  328  “Visit Florida” promotional video must also be included on all
  329  optical disc formats of a film, unless such placement is
  330  prohibited by licensing or other contractual obligations. The
  331  30-second promotional video shall be approved and provided by
  332  the Florida Tourism Industry Marketing Corporation in
  333  consultation with the Commissioner of Film and Entertainment.
  338         (a) Priority for tax credit award.—The priority of a
  339  qualified production for tax credit awards must be determined on
  340  a first-come, first-served basis within its appropriate queue.
  341  Each qualified production must be placed into the appropriate
  342  queue and is subject to the requirements of that queue.
  343         (b) Tax credit eligibility.—
  344         1. General production queue.—Ninety-four percent of tax
  345  credits authorized pursuant to subsection (6) in any state
  346  fiscal year must be dedicated to the general production queue.
  347  The general production queue consists of all qualified
  348  productions other than those eligible for the commercial and
  349  music video queue or the independent and emerging media
  350  production queue. A qualified production that demonstrates a
  351  minimum of $625,000 in qualified expenditures is eligible for
  352  tax credits equal to 20 percent of its actual qualified
  353  expenditures, up to a maximum of $8 million. A qualified
  354  production that incurs qualified expenditures during multiple
  355  state fiscal years may combine those expenditures to satisfy the
  356  $625,000 minimum threshold.
  357         a. An off-season certified production that is a feature
  358  film, independent film, or television series or pilot is
  359  eligible for an additional 5 percent tax credit on actual
  360  qualified expenditures. An off-season certified production that
  361  does not complete 75 percent of principal photography due to a
  362  disruption caused by a hurricane or tropical storm may not be
  363  disqualified from eligibility for the additional 5 percent
  364  credit as a result of the disruption.
  365         b. If more than 45 percent of the sum of total tax credits
  366  initially certified and awarded after April 1, 2012, total tax
  367  credits initially certified after April 1, 2012, but not yet
  368  awarded, and total tax credits available for certification after
  369  April 1, 2012, but not yet certified has been awarded for high
  370  impact television series, then no high-impact television series
  371  is eligible for tax credits under this subparagraph. Tax credits
  372  initially certified for a high-impact television series after
  373  April 1, 2012, may not be awarded if the award will cause the
  374  percentage threshold in this sub-subparagraph to be exceeded.
  375  This sub-subparagraph does not prohibit the award of tax credits
  376  certified before April 1, 2012, for high-impact television
  377  series.
  378         c. Subject to sub-subparagraph b., first priority in the
  379  queue for tax credit awards not yet certified shall be given to
  380  high-impact television series and high-impact digital media
  381  projects. For the purposes of determining priority between a
  382  high-impact television series and a high-impact digital media
  383  project, the first position must go to the first application
  384  received. Thereafter, priority shall be determined by
  385  alternating between a high-impact television series and a high
  386  impact digital media project on a first-come, first-served
  387  basis. However, if the Office of Film and Entertainment receives
  388  an application for a high-impact television series or high
  389  impact digital media project that would be certified but for the
  390  alternating priority, the office may certify the project as
  391  being in the priority position if an application that would
  392  normally be the priority position is not received within 5
  393  business days.
  394         d. A qualified production for which at least 67 percent of
  395  its principal photography days occur within a region designated
  396  as an underutilized region at the time that the production is
  397  certified is eligible for an additional 5 percent tax credit.
  398         e. A qualified production that employs students enrolled
  399  full-time in a film and entertainment-related or digital media
  400  related course of study at an institution of higher education in
  401  this state is eligible for an additional 15 percent tax credit
  402  on qualified expenditures that are wages, salaries, or other
  403  compensation paid to such students. The additional 15 percent
  404  tax credit is also applicable to persons hired within 12 months
  405  after graduating from a film and entertainment-related or
  406  digital media-related course of study at an institution of
  407  higher education in this state. The additional 15 percent tax
  408  credit applies to qualified expenditures that are wages,
  409  salaries, or other compensation paid to such recent graduates
  410  for 1 year after the date of hiring.
  411         f. A qualified production for which 50 percent or more of
  412  its principal photography occurs at a qualified production
  413  facility, or a qualified digital media project or the digital
  414  animation component of a qualified production for which 50
  415  percent or more of the project’s or component’s qualified
  416  expenditures are related to a qualified digital media production
  417  facility, is eligible for an additional 5 percent tax credit on
  418  actual qualified expenditures for production activity at that
  419  facility.
  420         g. A qualified production is not eligible for tax credits
  421  provided under this paragraph totaling more than 30 percent of
  422  its actual qualified expenses.
  423         2. Commercial and music video queue.—Three percent of tax
  424  credits authorized pursuant to subsection (6) in any state
  425  fiscal year must be dedicated to the commercial and music video
  426  queue. A qualified production company that produces national or
  427  regional commercials or music videos may be eligible for a tax
  428  credit award if it demonstrates a minimum of $100,000 in
  429  qualified expenditures per national or regional commercial or
  430  music video and exceeds a combined threshold of $500,000 after
  431  combining actual qualified expenditures from qualified
  432  commercials and music videos during a single state fiscal year.
  433  After a qualified production company that produces commercials,
  434  music videos, or both reaches the threshold of $500,000, it is
  435  eligible to apply for certification for a tax credit award. The
  436  maximum credit award shall be equal to 20 percent of its actual
  437  qualified expenditures up to a maximum of $500,000. If there is
  438  a surplus at the end of a fiscal year after the Office of Film
  439  and Entertainment certifies and determines the tax credits for
  440  all qualified commercial and video projects, such surplus tax
  441  credits shall be carried forward to the following fiscal year
  442  and are available to any eligible qualified productions under
  443  the general production queue.
  444         3. Independent and emerging media production queue.—Three
  445  percent of tax credits authorized pursuant to subsection (6) in
  446  any state fiscal year must be dedicated to the independent and
  447  emerging media production queue. This queue is intended to
  448  encourage independent film and emerging media production in this
  449  state. Any qualified production, excluding commercials,
  450  infomercials, or music videos, which demonstrates at least
  451  $100,000, but not more than $625,000, in total qualified
  452  expenditures is eligible for tax credits equal to 20 percent of
  453  its actual qualified expenditures. If a surplus exists at the
  454  end of a fiscal year after the Office of Film and Entertainment
  455  certifies and determines the tax credits for all qualified
  456  independent and emerging media production projects, such surplus
  457  tax credits shall be carried forward to the following fiscal
  458  year and are available to any eligible qualified productions
  459  under the general production queue.
  460         4. Family-friendly productions.—A certified theatrical or
  461  direct-to-video motion picture production or video game
  462  determined by the Commissioner of Film and Entertainment, with
  463  the advice of the Florida Film and Entertainment Advisory
  464  Council, to be family-friendly, based on review of the script
  465  and review of the final release version, is eligible for an
  466  additional tax credit equal to 5 percent of its actual qualified
  467  expenditures. Family-friendly productions are those that have
  468  cross-generational appeal; would be considered suitable for
  469  viewing by children age 5 or older; are appropriate in theme,
  470  content, and language for a broad family audience; embody a
  471  responsible resolution of issues; and do not exhibit or imply
  472  any act of smoking, sex, nudity, or vulgar or profane language.
  473         (c) Withdrawal of tax credit eligibility.—A qualified or
  474  certified production must continue on a reasonable schedule,
  475  which includes beginning principal photography or the production
  476  project in this state no more than 45 calendar days before or
  477  after the principal photography or project start date provided
  478  in the production’s program application. The department shall
  479  withdraw the eligibility of a qualified or certified production
  480  that does not continue on a reasonable schedule.
  481         (d) Election and distribution of tax credits.—
  482         1. A certified production company receiving a tax credit
  483  award under this section shall, at the time the credit is
  484  awarded by the department after production is completed and all
  485  requirements to receive a credit award have been met, make an
  486  irrevocable election to apply the credit against taxes due under
  487  chapter 220, against state taxes collected or accrued under
  488  chapter 212, or against a stated combination of the two taxes.
  489  The election is binding upon any distributee, successor,
  490  transferee, or purchaser. The department shall notify the
  491  Department of Revenue of any election made pursuant to this
  492  paragraph.
  493         2. A qualified production company is eligible for tax
  494  credits against its sales and use tax liabilities and corporate
  495  income tax liabilities as provided in this section. However, tax
  496  credits awarded under this section may not be claimed against
  497  sales and use tax liabilities or corporate income tax
  498  liabilities for any tax period beginning before July 1, 2011,
  499  regardless of when the credits are applied for or awarded.
  500         (e) Tax credit carryforward.—If the certified production
  501  company cannot use the entire tax credit in the taxable year or
  502  reporting period in which the credit is awarded, any excess
  503  amount may be carried forward to a succeeding taxable year or
  504  reporting period. A tax credit applied against taxes imposed
  505  under chapter 212 may be carried forward for a maximum of 5
  506  years after the date the credit is awarded. A tax credit applied
  507  against taxes imposed under chapter 220 may be carried forward
  508  for a maximum of 5 years after the date the credit is awarded,
  509  after which the credit expires and may not be used.
  510         (f) Consolidated returns.—A certified production company
  511  that files a Florida consolidated return as a member of an
  512  affiliated group under s. 220.131(1) may be allowed the credit
  513  on a consolidated return basis up to the amount of the tax
  514  imposed upon the consolidated group under chapter 220.
  515         (g) Partnership and noncorporate distributions.—A qualified
  516  production company that is not a corporation as defined in s.
  517  220.03 may elect to distribute tax credits awarded under this
  518  section to its partners or members in proportion to their
  519  respective distributive income or loss in the taxable year in
  520  which the tax credits were awarded.
  521         (h) Mergers or acquisitions.—Tax credits available under
  522  this section to a certified production company may succeed to a
  523  surviving or acquiring entity subject to the same conditions and
  524  limitations as described in this section; however, they may not
  525  be transferred again by the surviving or acquiring entity.
  526         (5) TRANSFER OF TAX CREDITS.—
  527         (a) Authorization.—Upon application to the Office of Film
  528  and Entertainment and approval by the department, a certified
  529  production company, or a partner or member that has received a
  530  distribution under paragraph (4)(g), may elect to transfer, in
  531  whole or in part, any unused credit amount granted under this
  532  section. An election to transfer any unused tax credit amount
  533  under chapter 212 or chapter 220 must be made no later than 5
  534  years after the date the credit is awarded, after which period
  535  the credit expires and may not be used. The department shall
  536  notify the Department of Revenue of the election and transfer.
  537         (b) Number of transfers permitted.—A certified production
  538  company that elects to apply a credit amount against taxes
  539  remitted under chapter 212 is permitted a one-time transfer of
  540  unused credits to one transferee. A certified production company
  541  that elects to apply a credit amount against taxes due under
  542  chapter 220 is permitted a one-time transfer of unused credits
  543  to no more than four transferees, and such transfers must occur
  544  in the same taxable year.
  545         (c) Transferee rights and limitations.—The transferee is
  546  subject to the same rights and limitations as the certified
  547  production company awarded the tax credit, except that the
  548  initial transferee shall be permitted a one-time transfer of
  549  unused credits to no more than two subsequent transferees, and
  550  such transfers must occur in the same taxable year as the
  551  credits were received by the initial transferee, after which the
  552  subsequent transferees may not sell or otherwise transfer the
  553  tax credit.
  555         (a) Beginning July 1, 2011, a certified production company,
  556  or any person who has acquired a tax credit from a certified
  557  production company pursuant to subsections (4) and (5), may
  558  elect to relinquish the tax credit to the Department of Revenue
  559  in exchange for 90 percent of the amount of the relinquished tax
  560  credit.
  561         (b) The Department of Revenue may approve payments to
  562  persons relinquishing tax credits pursuant to this subsection.
  563         (c) Subject to legislative appropriation, the Department of
  564  Revenue shall request the Chief Financial Officer to issue
  565  warrants to persons relinquishing tax credits. Payments under
  566  this subsection shall be made from the funds from which the
  567  proceeds from the taxes against which the tax credits could have
  568  been applied pursuant to the irrevocable election made by the
  569  certified production company under subsection (4) are deposited.
  571         (a) The aggregate amount of the tax credits that may be
  572  certified pursuant to paragraph (3)(d) may not exceed:
  573         1. For fiscal year 2010-2011, $53.5 million.
  574         2. For fiscal year 2011-2012, $74.5 million.
  575         3. For fiscal years 2012-2013, 2013-2014, 2014-2015, and
  576  2015-2016, $42 million per fiscal year.
  577         (b) Any portion of the maximum amount of tax credits
  578  established per fiscal year in paragraph (a) that is not
  579  certified as of the end of a fiscal year shall be carried
  580  forward and made available for certification during the
  581  following 2 fiscal years in addition to the amounts available
  582  for certification under paragraph (a) for those fiscal years.
  583         (c) Upon approval of the final tax credit award amount
  584  pursuant to subparagraph (3)(f)2., an amount equal to the
  585  difference between the maximum tax credit award amount
  586  previously certified under paragraph (3)(d) and the approved
  587  final tax credit award amount shall immediately be available for
  588  recertification during the current and following fiscal years in
  589  addition to the amounts available for certification under
  590  paragraph (a) for those fiscal years.
  591         (d) If, during a fiscal year, the total amount of credits
  592  applied for, pursuant to paragraph (3)(a), exceeds the amount of
  593  credits available for certification in that fiscal year, such
  594  excess shall be treated as having been applied for on the first
  595  day of the next fiscal year in which credits remain available
  596  for certification.
  598         (a) The department may adopt rules pursuant to ss.
  599  120.536(1) and 120.54 and develop policies and procedures to
  600  implement and administer this section, including, but not
  601  limited to, rules specifying requirements for the application
  602  and approval process, records required for substantiation for
  603  tax credits, procedures for making the election in paragraph
  604  (4)(d), the manner and form of documentation required to claim
  605  tax credits awarded or transferred under this section, and
  606  marketing requirements for tax credit recipients.
  607         (b) The Department of Revenue may adopt rules pursuant to
  608  ss. 120.536(1) and 120.54 to administer this section, including
  609  rules governing the examination and audit procedures required to
  610  administer this section and the manner and form of documentation
  611  required to claim tax credits awarded, transferred, or
  612  relinquished under this section.
  615         (a) Audit authority.—The Department of Revenue may conduct
  616  examinations and audits as provided in s. 213.34 to verify that
  617  tax credits under this section are received, transferred, and
  618  applied according to the requirements of this section. If the
  619  Department of Revenue determines that tax credits are not
  620  received, transferred, or applied as required by this section,
  621  it may, in addition to the remedies provided in this subsection,
  622  pursue recovery of such funds pursuant to the laws and rules
  623  governing the assessment of taxes.
  624         (b) Revocation of tax credits.—The department may revoke or
  625  modify any written decision qualifying, certifying, or otherwise
  626  granting eligibility for tax credits under this section if it is
  627  discovered that the tax credit applicant submitted any false
  628  statement, representation, or certification in any application,
  629  record, report, plan, or other document filed in an attempt to
  630  receive tax credits under this section. The department shall
  631  immediately notify the Department of Revenue of any revoked or
  632  modified orders affecting previously granted tax credits.
  633  Additionally, the applicant must notify the Department of
  634  Revenue of any change in its tax credit claimed.
  635         (c) Forfeiture of tax credits.—A determination by the
  636  Department of Revenue, as a result of an audit pursuant to
  637  paragraph (a) or from information received from the Office of
  638  Film and Entertainment, that an applicant received tax credits
  639  pursuant to this section to which the applicant was not entitled
  640  is grounds for forfeiture of previously claimed and received tax
  641  credits. The applicant is responsible for returning forfeited
  642  tax credits to the Department of Revenue, and such funds shall
  643  be paid into the General Revenue Fund of the state. Tax credits
  644  purchased in good faith are not subject to forfeiture unless the
  645  transferee submitted fraudulent information in the purchase or
  646  failed to meet the requirements in subsection (5).
  647         (d) Fraudulent claims.—Any applicant that submits
  648  fraudulent information under this section is liable for
  649  reimbursement of the reasonable costs and fees associated with
  650  the review, processing, investigation, and prosecution of the
  651  fraudulent claim. An applicant that obtains a credit payment
  652  under this section through a claim that is fraudulent is liable
  653  for reimbursement of the credit amount plus a penalty in an
  654  amount double the credit amount. The penalty is in addition to
  655  any criminal penalty to which the applicant is liable for the
  656  same acts. The applicant is also liable for costs and fees
  657  incurred by the state in investigating and prosecuting the
  658  fraudulent claim.
  659         (10) ANNUAL REPORT.—Each November 1, the Office of Film and
  660  Entertainment shall submit an annual report for the previous
  661  fiscal year to the Governor, the President of the Senate, and
  662  the Speaker of the House of Representatives which outlines the
  663  incentive program’s return on investment and economic benefits
  664  to the state. The report must also include an estimate of the
  665  full-time equivalent positions created by each production that
  666  received tax credits under this section and information relating
  667  to the distribution of productions receiving credits by
  668  geographic region and type of production. The report must also
  669  include the expenditures report required under s. 288.1253(3)
  670  and the information describing the relationship between tax
  671  exemptions and incentives to industry growth required under s.
  672  288.1258(5).
  673         (11) REPEAL.—This section is repealed July 1, 2016, except
  674  that:
  675         (a) Tax credits certified under paragraph (3)(d) before
  676  July 1, 2016, may be awarded under paragraph (3)(f) on or after
  677  July 1, 2016, if the other requirements of this section are met.
  678         (b) Tax credits carried forward under paragraph (4)(e)
  679  remain valid for the period specified.
  680         (c) Subsections (5), (8) and (9) shall remain in effect
  681  until July 1, 2021.
  682         Section 2. This act shall take effect July 1, 2019.