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HomeMy WebLinkAboutO-10-01ORDINANCE NO. 0 -10 -01 AN ORDINANCE OF THE CITY OF SEBASTIAN, FLORIDA, IMPLEMENTING AN ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION PROGRAM FOR THE CITY OF SEBASTIAN; PROVIDING FOR SEVERABILITY; PROVIDING FOR AN EFFECTIVE DATE AND SUNSET DATE. WHEREAS, at the November 3, 2009 General Election, City of Sebastian electors passed a referendum authorizing the city council to provide for property tax exemptions for new businesses and expansion of existing businesses which create jobs in accordance with s. 3, article VII of the State Constitution and Florida Statutes Chapter 196; and WHEREAS, the City Council desires to implement the Economic Development Ad Valorem Tax Abatement Program. NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, as follows: SECTION 1. That the City Code of the City of Sebastian, Florida, Chapter 94, is hereby amended by adding a new Article IV to read as follows: "Chapter 94. ARTICLE IV. ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION. Sec. 94-52. Definitions. (a) Applicant. Any person, firm, partnership, or corporation that files an application with the city seeking an economic development ad valorem tax exemption. (b) Business. Any activity engaged in by any person, firm, partnership, corporation, or other business organization or entity, with the object of private or public gain, benefit, or advantage, either direct or indirect. (c) Department. The Florida Department of Revenue. (d) Expansion of an existing business: (1) As defined in Section 196.012(16), Florida Statutes, (as the same may be amended or renumbered from time to time) an expansion of an existing business means: a. A business establishing ten or more jobs to employ ten or more full -time employees in this state, which manufactures, processes, compounds, fabricates, or produces for sale, items of tangible personal property at a fixed location and which comprises an industrial or manufacturing plant; or b. A business establishing 25 or more jobs to employ 25 or more full time employees in this state, the sales factor of which, as defined by Section 220.15(5), Florida Statutes, for the facility with respect to which it requests an economic development ad valorem tax exemption is less than 0.50 for each year the exemption is claimed; provided that such business increases operations on a site co- located with a commercial or industrial operation owned by (e) Improvements. Physical changes made to raw land, and structures placed on or under the land surface. (t) New business. (g) the same business resulting in a net increase in employment of not less than 10% or an increase in productive output of not Tess than 10 (1) As defined in Section 196.012(15), Florida Statutes, (as the same may be amended or renumbered from time to time) a new business means: a. A business establishing ten or more jobs to employ ten or more full -time employees in this state which manufactures, processes, compounds, fabricates, or produces for sale items of tangible personal property at a fixed location and which comprises an industrial or manufacturing plant; b. A business establishing twenty -five or more jobs to employ twenty -five or more full -time employees in this state, the sales factor of which, as defined by Section 220.15(5), Florida Statutes, for the facility with respect to which it requests an economic development ad valorem tax exemption is less than 0.50 for each year the exemption is claimed; or c. An office space in this state owned and used by a corporation newly domiciled in this state, provided such office space houses fifty or more full -time employees of such corporation; provided that such business or office first begins operation on a site clearly separate from any other commercial or industrial operation owned by the same business. d. A business that is situated on property annexed into a municipality and that, at the time of the annexation, is receiving an economic development ad valorem tax exemption from the county under FS. 196.1995. Sales factor. As defined in Section 220.15(5), Florida Statutes, (as the same may be amended or renumbered from time to time) the sales factor is a fraction, the numerator of which is the total sales of the taxpayer in this state during the taxable year or period and the denominator of which is the total sales of the taxpayer everywhere during the taxable year or period. Sec. 94 53. Economic development ad valorem tax exemption established. (a) There is herein established an economic development ad valorem tax exemption (herein after the "exemption The exemption is a local option tax incentive for new or expanding businesses which may be granted or refused at the discretion of the city. (b) The exemptions shall not accrue to improvements to real property made by or for the use of new or expanding businesses when such improvements have been included on the tax rolls prior to the effective date of the ordinance specifically granting a business an exemption as provided in this article. 2 (c) Any exemption granted may apply up to 100% of the assessed value of all improvements to real property made by or for the use of a new business and of all tangible personal property of such new business, or up to 100% of the assessed value of all added improvements to real property made to facilitate the expansion of an existing business and of the net increase in all tangible personal property acquired to facilitate such expansion of an existing business, provided that the improvements to real property are made or the tangible personal property is added or increased on or after the effective date of the ordinance specifically granting a business an exemption as provided in this article. Property acquired to replace existing property shall not be considered to facilitate a business expansion. (d) The exemption shall be granted by ordinance for every eligible project, as determined by the city council at its discretion. The exemption may be granted for a period up to ten years from the date of adoption of the ordinance granting the exemption. (e) No exemption shall be granted for the land upon which new or expanded businesses are to be located. (f) The exemption shall apply only to taxes levied by the city. The exemption shall not apply to taxes levied by the county, school district or water management district, or to taxes levied for the payment of bonds or taxes authorized by a vote of the electors pursuant to Section 9 and Section 12, Article VII of the Florida Constitution. (g) The ability to receive an exemption for the period granted shall be conditioned upon the applicant's ability to maintain the new business or the expansion of an existing business as defined by the conditions of this application throughout the entire exemption period. The applicant shall be required to submit a report on an annual basis to the city evidencing satisfaction of this condition. In addition, any business granted an exemption shall furnish to the city, such information /report as the city may reasonably deem necessary for the purpose of determining continuing performance by the business of the conditions stated in this division, the ordinance granting the exemption and the representations made in the application process. Sec. 94 -54. Application for exemption. (a) shall file with (b) applicant the Any eligible person, firm, partnership or corporation, which desires an exemption, the city manager written application prescribed by the department. The application shall request that the city council adopt an ordinance granting the exemption and shall include, at a minimum, the following: (1) The name and location of the new business or the expansion of an existing business; (2) A legal description of the real property, a description of the improvements to the real property for which an exemption is required, and the date of intended or actual commencement of construction of such improvements; (3) A description of the tangible personal property for which an exemption is requested and the dates when such property was or is to be purchased; (4) Proof, to the satisfaction of the city council, that the applicant meets the criteria for a new business or for an expansion of an existing business as defined in this article; (5) Other information deemed necessary by the city council or the city manager. 3 (c) If the city manager determines that the applicant is eligible and has an interest in allowing the application to proceed, the city manager shall refer the application to the property appraiser for a report which shall include the following: (1) The total revenue available to the city for the current fiscal year from ad valorem tax sources, or an estimate of such revenue if the actual total available revenue cannot be determined; (2) The amount of revenue lost to the city for the current fiscal year by virtue of exemptions previously granted, or an estimate of such revenue if the actual revenue lost cannot be determined; (3) An estimate of the amount of revenue which would be lost to the city for the current fiscal year if the exemption applied for was granted had the property for which the exemption is requested otherwise been subject to taxation; and (4) A determination as to whether the property for which an exemption is requested is to be incorporated into a new business or the expansion of an existing business, or into neither, which determination the property appraiser shall also affix to the face of the application. Upon request, the department will provide the property appraiser such information as it may have available to assist in making this determination. (d) If a new business is locating to, or an expansion of an existing business is occurring in a community redevelopment area, the community redevelopment agency advisory committee overseeing such area shall be provided a copy of the application for review and comment. Sec. 94 -55. City council consideration of application. (a) An ordinance granting an exemption shall include: (1) The name and address of the new business or expansion of an existing business. (2) The total amount of revenue available to the city from ad valorem tax sources for the current fiscal year, the total amount of the revenue lost to the city for the current fiscal year by virtue of exemptions currently in effect, and the estimated amount of revenue attributable to the exemption to the new or expanding business; (3) The expiration date of the exemption, which shall be ten years or less (depending upon the duration of the exemption granted) from the date the city council enacts the ordinance granting the exemption; and (4) A finding that the business meets the definition of a new business or an expansion of an existing business as set forth in this article. (b) No precedent shall be implied or inferred by the granting of any exemption. Applications for exemptions shall be considered by the city council on a case -by -case basis. Sec. 94 -56. Revocation of exemption /recovery of funds. Should any new business or expansion of an existing business fail to file the annual report or any other report required in this article, or fail to continue to meet the definition of a 4 new business or an expansion of an existing business, and /or fail to fulfill any other representation made to the city council during the application process, the city council may adopt an ordinance revoking the ad valorem tax exemption. An ordinance revoking the ad valorem tax exemption may provide that the city recover any taxes waived during the exemption period. Nothing herein shall prohibit a business from reapplying for an ad valorem tax exemption pursuant to state law. Sec. 94 -57. Sunset Repealer. This ordinance shall stand repealed effective November 3, 2019, unless renewed by a referendum at a general or special election held upon, prior to, or in the same month as that date, as is authorized under the provisions of §196.1995(1), (2) and (6), Florida Statues or any successor or amended version of that statute. SECTION 2. SEVERABILITY. In the event a court of competent jurisdiction shall determine that any part of this Ordinance is invalid or unconstitutional, the remainder of the Ordinance shall not be affected and it shall be presumed that the City Council of the City of Sebastian did not intend to enact such invalid provisions. It shall further be assumed that the City Council would have enacted the remainder of this Ordinance without said invalid or unconstitutional provision, thereby causing said remainder to remain in full force and effect. SECTION 3. EFFECTIVE DATE. This Ordinance shall take effect immediately upon its adoption. The foregoing Ordinance was moved for adoption by Council Member Wright The motion was seconded by Council Member Gillmor and upon being put to a vote, the vote was as follows: Mayor Richard Gillmor aye Vice Mayor Jim Hill aye Council Member Andrea Coy aye Council Member Eugene Wolff absent Council Member Don Wright aye The Mayor thereupon declared this Ordinance duly passed and adopted this January 2010 ATTEST: Q Sally A. M o, MMC City Cler CITY STIAN, FLORIDA Richard Gillmor, Mayor Robert A. Ginsburg, City Attorney 13 5 day of Approved as to form and legality for reliance by the City of Sebastian: