Legislative Successes For 2004

''2001 Legislative Session Report''

Final Legislative Report for the 2001 Session

Although, the Alliance members should be pleased with some of the actions of the legislature this year, a number of the Alliance’s key issues were derailed due to a tight budget year and no sympathy for industry tax exemptions. Below is a synopsis of key issues important to the aviation and aerospace industries.

Issue I: Tax Exemption on Space and Defense Research

Representative Chris Hart sponsored this legislation in House Bill 633. The proposed legislation provides full, rather than partial, exemption for machinery & equipment used to produce defense or space technology products or used in defense or space research & development activities. It amends Florida Statutes 212.08 and if it passed would become effective on January 1, 2002. Neither, House Bill 633 or the Senate version, Senate Bill 664 by Senator Donald Sullivan passed this year.

Issue II: Aviation Fuel Tax

This legislation was sponsored by Senator Lee Constantine in Senate Bill 1668. It rescinds the repeal of the alternative tax rate for aviation fuel. If the bill passes, it would have an effective date of July 1, 2001. Representative Rafael Arza sponsored a House version, House Bill 1629. Neither the House nor Senate version passed this year.

Issue III: Sales Tax Exemption for Aircrew Training Simulators

FAAA was requesting to exempt any facility, school or business that trains aircraft pilots and flight crews, as provided under Part 142 of Federal Aviation Administration regulations, for approval, certification, or regulation by the Federal Aviation Administration, or a comparable foreign regulatory authority, from sales taxes. No bill numbers are available at this time. This issue did not pass this year.

Other Bills the Alliance Monitored:

Relating to Kennedy Space Center/Sales Tax

Senator Charlie Bronson sponsored this legislation as Senate Bill 1482. The bill provides that taxes collected by dealers conducting business at fixed location at Kennedy Space Center or Cape Canaveral Air Station on admissions thereto & on sales of tangible personal property at such business shall be separately returned distributed by the Department of Revenue to the Florida Commercial Space Financing Corporation, Spaceport Florida Authority & used for funding aerospace infrastructure. This language was similar to House Bill 1111 by Representative Allen. Although Senate Bill 1482 did not pass, Senator Bronson was able to secure a one time appropriation of $1.3 million of General Revenue and spending authority and the definition for Spaceport Infrastructure included as part of the Transportation package, House Bill 1053 which did pass both Chambers.

Taxation/Industrial Machinery

Representative Rob Wallace sponsored this legislation in House Bill 527. The bill revises exemption for industrial machinery & equipment used in expanding spaceport or manufacturing facilities; removes restriction that exemption apply only to expanding facilities; provides for full, rather than partial, exemption; removes provisions re qualification for exemption for machinery & equipment used in expanding phosphate or other solid minerals severance, mining or processing operations, to conform. It amends Florida Statutes 212.08 and .0805. It has an effective date of July 1, 2001. Neither, House Bill 527 or the companion bill, Senate Bill 1800 by Senator Ginny Brown Waite passed this year.

Math & Science Teacher Education

Senator Donald Sullivan sponsored this legislation as Senate Bill 746. This bill authorizes mathematics & science teacher-education program; provides program purpose, required components, & resource allocation; authorizes incentives & certification; creates nongovernmental organization to plan & implement program for mathematics & science teacher education; authorizes salary bonus for teachers who complete certain training programs. Senate Bill 746 passed the Florida Senate but was not taken up by the House of Representatives. A companion bill, House Bill 1463 by Representative Mike Haridopolos did not make it through its committee references in the House.

Local Airport Authority

Senator Diaz de la Portilla sponsored Senate Bill 506, which would authorize creation of an airport authority in Dade County. The language passed as part the Transporation package, House Bill 1053.

Small Aircraft Transportation Systems (SATS)

This legislation authorizes funding for developing a Small Aircraft Transportation Systems (SATS) in Florida. The proposal was sponsored by Senator Jones in Senate Bill 1776 and Representative Baker in House Bill 1059. The language expressing legislative intent and recognition of the importance of SATS in Florida passed as part of House Bill 1053.

Spaceport Infrastructure Act

Representative Allen in House Bill 1111 sponsored this legislation. The bill creates a Spaceport Reinvestment fund; and requires that sales of tangible personal property collected by dealers conducting business at Kennedy Space Center or Cape Canaveral Air Station shall be returned to the Department of Revenue and distributed to the Florida Commercial Space Financing Corporation. House Bill 1111 passed the House of Representatives but was not taken up by the Senate. It was a similar bill, to Senate Bill 1482 by Senator Bronson.

Spaceport Florida Authority

Senate Bill 1976 was sponsored by Senator Sebesta. The bill creates a Space Commerce Board, and revises the membership and functions of entities under the Spaceport Management Council. This language also passed as part of the Transportation package, House Bill 1053.

Economic Development and Business Issues:

Appropriations

Here is a summary listing the Governors request and the final legislative appropriation:

EFI $10,872,698 $$10,972,698

QTI $24,700,000 $$24,000,000

QACF $ 4,000,000 $1,500,000

Roads$20,000,000 $20,000,000

QRT $6,000,000 $6,000,000

HIPI $5,380,000 $5,375,000

Rural $4,000,000 $4,000,000

Defense $4,000,000 $5,000,000

SERPL $16,000,000 $16,000,000

CAMACOL $200,000 $300,000

Qualified Target Industries Cap

The Senate passed Senate Bill 2008 and Senate Bill 1750, both bills that had provisions included which would increase the QTI cap to $35 million. The QTI Cap increase was also added in the House to House Bill 1225. The bill passed the House 107-1 in the final hour: consequently, achieving a QTI Cap increase from $30 million to $35 million.

Public Records Exemption

The House passed House Bill 1541, which provides for a public records exemption for economic development agencies and contains enhancement language. The Senate took up the companion bill, Senate Bill 484 and then substituted the House bill. This issue is now headed to the Governor’s desk.

Workers Compensation

Senate Bill 1926 was substituted by the House for House Bill 1803 in the closing hour of the session and passed. The bill moves the Workers’ Comp Judges to Dept. of Administrative Hearings and makes several minor administrative changes recommended by the Workers’ Compensation Task Force. Unfortunately, the major workers’ comp reform bill, CS/Senate Bill 1188, died on the calendar.

Rural Economic Development

The House passed the rural economic development package in the final hour on May 4th by a vote of 107-1. House Bill 1225 provides that businesses that are eligible for QTI refunds are also eligible for the rural job tax credit program as well as other financial incentives. The bill also includes other items such as increasing the enterprise zone jobs credit against sales tax in addition to revising the method used to compute these credits. The companion bill, Senate Bill 460, had previously passed the Senate by a vote of 33-0 and the contents were amended onto House Bill 1225.

High Speed Rail

House Bill 489 passed both Houses; however, the bill was revised. Originally, the bill called for the creation of the High Speed Rail Study Commission, which would study the costs associated with building and maintaining such a system. However, an amendment was offered to the bill, which made the bill create the High Speed Rail Authority, which would begin planning and performing pre-development measures immediately.

Intangibles Tax

The House and Senate both passed House Bill 21, a measure which would exempt a person with investments valued at less than $250,000, or couples with $500,000 in assets from paying the state’s intangibles tax. This is up from the current $80,000 exemption for individuals, and $100,000 exemption for couples. The bill also contains a provision that exempts businesses from paying the tax for all assets less than $500,000.

Growth Management

The House worked diligently and passed House Bill 1617. The bill would have required all growth management plans to include a public school facilities requirement. The Senate companion bill, Senate Bill 310, was never taken up and with the Senate adjourning at 9:00 p.m. all hopes of any growth management legislation being passed were put to rest. The issue is almost certain to be a top priority next session as the Governor has made it very clear from his Legislative Opening Day Speech of Florida’s vital need for some type of improvement in Florida’s growth management laws. One of the major concerns seems to be whether to allow local school boards the authority to levy taxes to pay for infrastructure needs.

To receive copies of any of the bills by mail, contact Senate documents at 850-487-5915 and House documents at 850-488-7475 and ask for the enrolled versions of the bill, and they will be mailed to you free of charge.

Corporate Income Tax-Sponsored Research
Exempts from Florida corporate income tax, the total costs arising from research & development done in cooperation with state universities

Sales Tax Exemption on Machinery and Equipment used in Silicon Technology Production
Creates tax exemption for machinery and equipment used in silicon technology production and research and development

Qualified Target Industry/Qualified Defense Contractor Programs
Successfully argued against House attempts to change the cap on commitments OTTED could make to companies using the QTI/QDC programs

Limited Liability Company Tax Exemption
Provides a corporate tax exemption for limited liability companies and domestic limited partnerships under certain circumstances and allows for mergers of domestic corporations and other business entities

Florida Preparedness for VentureStar Bid
Provides $1.6 million in the FY 1999 Budget to fund proposed development necessary to win the competition to locate VentureStar reusable launch vehicle operations in Florida

Modification to Sales Tax Exemption on Electricity Used in Manufacturing
Revises the activities that constitutes a manufacturing function and deletes the requirement that electricity be separately metered for tax exemption

Sales Tax Exemption on Aircraft Repair, Sales and Leasing
Provides sales tax exemptions for replacement parts, engines, and equipment used in the repair or maintenance of certain aircraft, and for the sale or lease of certain aircraft for use by a common carrier

Capital Investment Tax Credit
Provides a credit against Florida corporate income tax for capital investment costs relating to the construction and operation of projects in high impact business sectors such as aviation and aerospace



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