F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
HB 1125 2021
1 A bill to be entitled
2 An act relating to the capital investment tax credit;
3 amending s. 220.191, F.S.; redefining terms; defining
4 the terms "intellectual property" and "strategic
5 priority project"; providing a credit against the
6 corporate income tax, the sales and use tax, or a
7 stated combination of the two taxes to a qualifying
8 business that establishes a qualifying project for the
9 creation of intellectual property which meets certain
10 capital investment criteria; specifying the
11 calculation of the credit; authorizing the carryover
12 or transfer of credits, subject to certain conditions;
13 providing a credit against the corporate income tax,
14 the sales and use tax, or a stated combination of the
15 two taxes to a qualifying business that establishes a
16 strategic priority project that meets certain capital
17 investment criteria; specifying the calculation of the
18 credit; authorizing the carryover or transfer of
19 credits, subject to certain conditions; conforming
20 provisions to changes made by the act; amending s.
21 288.1089, F.S.; revising the definition of the term
22 "cumulative investment" to conform to changes made by
23 the act; providing an effective date.
24
25 Be It Enacted by the Legislature of the State of Florida:
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26
27 Section 1. Section 220.191, Florida Statutes, is amended
28 to read:
29 220.191 Capital investment tax credit.—
30 (1) DEFINITIONS.—As used in For purposes of this section,
31 the term:
32 (a) "Commencement of operations" means the beginning of
33 active operations by a qualifying business of the principal
34 function for which a qualifying project was constructed.
35 (b) "Cumulative capital investment" means the total
36 capital investment in land, buildings, and equipment made in
37 connection with a qualifying project during the period from the
38 beginning of construction of the project to the commencement of
39 operations.
40 (c)1. "Eligible capital costs" means all expenses incurred
41 by a qualifying business in connection with:
42 a. The acquisition, construction, installation, and
43 equipping of a qualifying project during the period from the
44 beginning of construction of the project to the commencement of
45 operations; or
46 b. A qualifying project for the development or creation of
47 intellectual property during the period from the start date of
48 the project to the completion of the project.
49 2. The term includes, including, but is not limited to:
50 a.1. The costs of acquiring, constructing, installing,
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51 equipping, and financing a qualifying project, including all
52 obligations incurred for labor and obligations to contractors,
53 subcontractors, builders, and materialmen.
54 b.2. The costs of acquiring land or rights to land and any
55 cost incidental thereto, including recording fees.
56 c.3. The costs of architectural and engineering services,
57 including test borings, surveys, estimates, plans and
58 specifications, preliminary investigations, environmental
59 mitigation, and supervision of construction, as well as the
60 performance of all duties required by or consequent to the
61 acquisition, construction, installation, and equipping of a
62 qualifying project.
63 d.4. The costs associated with the installation of
64 fixtures and equipment; surveys, including archaeological and
65 environmental surveys; site tests and inspections; subsurface
66 site work and excavation; removal of structures, roadways, and
67 other surface obstructions; filling, grading, paving, and
68 provisions for drainage, storm water retention, and installation
69 of utilities, including water, sewer, sewage treatment, gas,
70 electricity, communications, and similar facilities; and offsite
71 construction of utility extensions to the boundaries of the
72 property.
73 e. For the development or creation of intellectual
74 property, the wages, salaries, or other compensation paid to
75 legal residents of this state, including amounts paid through a
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76 loan-out company, an employee leasing company, or a payroll
77 service company. The term also includes expenditures for the
78 rental of tangible personal property or the provision of
79 services directly related to the development or creation of
80 intellectual property.
81
82 Eligible capital costs do shall not include the cost of any
83 property previously owned or leased by the qualifying business.
84 (d) "Income generated by or arising out of the qualifying
85 project" means the qualifying project's annual taxable income as
86 determined by generally accepted accounting principles and under
87 s. 220.13.
88 (e) "Intellectual property" means a copyrightable project
89 for which the eligible capital costs are principally paid
90 directly or indirectly for the development or creation of the
91 project. As used in this paragraph, the term "copyrightable
92 project" includes, but is not limited to, a copyrightable
93 software or multimedia application and its expansion content
94 made available to an end user, which includes, but is not
95 limited to, technological activities relating to updating the
96 project; internal development platforms that support the
97 production of multiple applications; cloud-based services that
98 support the functionality of multiple applications; and
99 copyrightable projects that include, but are not limited to,
100 digital visualization and sound synchronization technologies for
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101 digital media, or that are necessary for the production of
102 scripted content intended for theatrical, streaming, or
103 television distribution.
104 (f) "Jobs" means full-time equivalent positions, as that
105 term is consistent with terms used by the Department of Economic
106 Opportunity and the United States Department of Labor for
107 purposes of reemployment assistance tax administration and
108 employment estimation, resulting directly from a project in this
109 state. The term does not include temporary construction jobs
110 involved in the construction of the project facility.
111 (g)(f) "Qualifying business" means a business which
112 establishes a qualifying project or strategic priority project
113 in this state and which is certified by the Department of
114 Economic Opportunity to receive tax credits pursuant to this
115 section.
116 (h)(g) "Qualifying project" means a facility or project in
117 this state meeting one or more of the following criteria:
118 1. A new or expanding facility in this state which creates
119 at least 100 new jobs in this state and is in one of the high-
120 impact sectors identified by Enterprise Florida, Inc., and
121 certified by the Department of Economic Opportunity pursuant to
122 s. 288.108(6), including, but not limited to, aviation,
123 aerospace, automotive, and silicon technology industries.
124 However, between July 1, 2011, and June 30, 2014, the
125 requirement that a facility be in a high-impact sector is waived
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126 for any otherwise eligible business from another state which
127 locates all or a portion of its business to a Disproportionally
128 Affected County. For purposes of this section, the term
129 "Disproportionally Affected County" means Bay County, Escambia
130 County, Franklin County, Gulf County, Okaloosa County, Santa
131 Rosa County, Walton County, or Wakulla County.
132 2. A new or expanded facility in this state which is
133 engaged in a target industry designated pursuant to the
134 procedure specified in s. 288.106(2) and which is induced by
135 this credit to create or retain at least 1,000 jobs in this
136 state, provided that at least 100 of those jobs are new, pay an
137 annual average wage of at least 130 percent of the average
138 private sector wage in the area as defined in s. 288.106(2), and
139 make a cumulative capital investment of at least $100 million.
140 Jobs may be considered retained only if there is significant
141 evidence that the loss of jobs is imminent. Notwithstanding
142 subsection (2), annual credits against the tax imposed by this
143 chapter may not exceed 50 percent of the increased annual
144 corporate income tax liability or the premium tax liability
145 generated by or arising out of a project qualifying under this
146 subparagraph. A facility that qualifies under this subparagraph
147 for an annual credit against the tax imposed by this chapter may
148 take the tax credit for a period not to exceed 5 years.
149 3. A new or expanded headquarters facility in this state
150 which locates in an enterprise zone and brownfield area and is
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151 induced by this credit to create at least 1,500 jobs which on
152 average pay at least 200 percent of the statewide average annual
153 private sector wage, as published by the Department of Economic
154 Opportunity, and which new or expanded headquarters facility
155 makes a cumulative capital investment in this state of at least
156 $250 million.
157 4. A project involving the creation of intellectual
158 property, provided that the project's jobs in this state pay an
159 annual average wage of at least 150 percent of the average
160 private sector wage in the area as defined in s. 288.106. A
161 project that qualifies under this subparagraph may consist of
162 one or more projects with different start and completion dates.
163 (i) "Strategic priority project" means a qualifying
164 project identified in subparagraph (h)4. which demonstrates the
165 potential for measurable value to this state, including, but not
166 limited to, marketing Florida as a visitor destination,
167 improvements to infrastructure supporting future industry use,
168 or measurable technology skills development for residents of
169 this state.
170 (2)(a) An annual credit against the tax imposed by this
171 chapter shall be granted to any qualifying business in an amount
172 equal to 5 percent of the eligible capital costs generated by a
173 qualifying project, for a period not to exceed 20 years
174 beginning with the commencement of operations of the project.
175 Unless assigned as described in this subsection, the tax credit
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176 shall be granted against only the corporate income tax liability
177 or the premium tax liability generated by or arising out of the
178 qualifying project, and the sum of all tax credits provided
179 pursuant to this section shall not exceed 100 percent of the
180 eligible capital costs of the project. In no event may any
181 credit granted under this section be carried forward or backward
182 by any qualifying business with respect to a subsequent or prior
183 year. The annual tax credit granted under this section shall not
184 exceed the following percentages of the annual corporate income
185 tax liability or the premium tax liability generated by or
186 arising out of a qualifying project:
187 1. One hundred percent for a qualifying project which
188 results in a cumulative capital investment of at least $100
189 million.
190 2. Seventy-five percent for a qualifying project which
191 results in a cumulative capital investment of at least $50
192 million but less than $100 million.
193 3. Fifty percent for a qualifying project which results in
194 a cumulative capital investment of at least $25 million but less
195 than $50 million.
196 (b) A qualifying project which results in a cumulative
197 capital investment of less than $25 million is not eligible for
198 the capital investment tax credit. An insurance company claiming
199 a credit against premium tax liability under this program shall
200 not be required to pay any additional retaliatory tax levied
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201 pursuant to s. 624.5091 as a result of claiming such credit.
202 Because credits under this section are available to an insurance
203 company, s. 624.5091 does not limit such credit in any manner.
204 (c) A qualifying business that establishes a qualifying
205 project that includes locating a new solar panel manufacturing
206 facility in this state that generates a minimum of 400 jobs
207 within 6 months after commencement of operations with an average
208 salary of at least $50,000 may assign or transfer the annual
209 credit, or any portion thereof, granted under this section to
210 any other business. However, the amount of the tax credit that
211 may be transferred in any year shall be the lesser of the
212 qualifying business's state corporate income tax liability