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HomeMy WebLinkAbout2009 03 23 Public Hearing 500 Adoption Ordinance 2009-05 Ad Valorem Tax ExemptionsCOMMISSION AGENDA Consent ITEM 500 Informational Public Hearing ~ X March 23, 2009 I Regular ~i~~~'1 Mgr. / Att. / Dept. REQUEST: The City Attorney requests that the City Commission consider on Second Reading the adoption of Ordinance No. 2009-05, providing for a referendum to authorize the City Commission to grant economic development ad valorem tax exemptions for certain types of statutorily defined new businesses and expanding businesses. PURPOSE: The purpose of this Agenda item is to require a referendum election to be held to seek authorization from the City electorate to permit the City Commission to grant economic development ad valorem tax exemptions to certain types of statutorily defined new and expanding businesses within the City. APPLICABLE LAW AND PUBLIC POLICY: 1. The Florida Municipal Home Rule Powers Act. 2. Section 166.021(9), Florida Statutes. 3. Section 196.1995, Florida Statutes. CONSIDERATIONS: 1. On February 23, 2009, the City Commission directed that this Ordinance be prepared. 2. This ordinance would allow the City Commission, with the approval of the electorate, to directly provide economic development ad valorem exemption incentives to attract and encourage new and expanding businesses and redevelopment within the City. 3. Section 196.1995, Florida Statutes, provides that a municipality is authorized to grant economic development ad valorem tax exemptions for new businesses and expanding businesses. However, that authority must be generally granted by the voters of Winter Springs in a duly held referendum. 4. One important tool that some cities have found helpful while competing to attract new businesses is the ability to exempt real and tangible property from ad valorem taxes. However, because a municipality has no inherent authority to levy taxes, the authority to abate taxes must be found in general law. See 50 Fla. Jur 2d Taxation § 363. 5. The authority to abate ad valorem taxes for economic development purposes is set forth under Florida law. Particularly, section 196.1995, Florida Statutes, provides that a municipality is authorized to grant economic development ad valorem tax exemptions for new businesses and expanding businesses. However, that authority must be generally granted by the voters of Winter Springs in a duly held referendum. Id. To date, the City Commission has never requested this authority from the voters of Winter Springs. 6. If the authority is granted, the authority is only good fora 10-year period of time, but it may be renewed for another 10-year period in a referendum. 7. In general, if the authority is granted by the voters of Winter Springs, the City Commission, for a period of time not to exceed 10 years, "may exempt from ad valorem taxation up to 100 percent 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." Further, an exemption maybe granted "up to 100 percent 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." Id. 8. The terms "new business" and "expansion of an existing business" are specifically defined in sections 196.012(15) and (16), Florida Statutes. (A) A "new business" means: a. A business establishing 10 or more jobs to employ 10 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 25 or more jobs to employ 25 or more full-time employees in this state, the sales factor of which, as defined by s. 220.15(5), 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 50 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. Any business located in an enterprise zone or brownfield area that first begins operation on a site clearly separate from any other commercial or industrial operation owned by the same business. e. 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 s. 196.1995. (B) An "expansion of an existing business" means: a. A business establishing 10 or more jobs to employ 10 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 2S or more jobs to employ 25 or more full-time employees in this state, the sales factor of which, as defined by s. 220.15(5), for the facility with respect to which it requests an economic development ad valorem tax exemption is less than O.SO for each year the exemption is claimed; provided that such business increases operations on a site collocated with a commercial or industrial operation owned by the same business, resulting in a net increase in employment of not less than 10 percent or an increase in productive output of not less than 10 percent. c. Any business located in an enterprise zone or brownfield area that increases operations on a site collocated with a commercial or industrial operation owned by the same business. 9. Once the authority is granted by the voters, each specific exemption granted under that authority must be granted by Ordinance of the City Commission. Each exemption is limited to a maximum 10-year period. There is also a detailed written application requirement provided for under the statute. Before the City Commission can act on the application, the application is further required to be delivered to the Property Appraiser, who is responsible for preparing a report which addresses the eligibility of the applicant and an estimate of the amount of revenue that the city will lose because of the exemption. STAFF RECOMMENDATION: The City Attorney and City Manager recommend that the City Commission adopt Ordinance 2009-OS on Second and Final Reading. ATTACHMENT: Ordinance 2009-OS COMMISSION ACTION: On February 23, 2009, the City Commission directed that this Ordinance be prepared for consideration. The Ordinance was passed on First Reading on March 9, 2009. ORDINANCE N0.2009-OS AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, SEMINOLE COUNTY FLORIDA; PROVIDING FOR A REFERENDUM ELECTION AND BALLOT LANGUAGE FOR AN ELECTION TO BE SCHEDULED BY THE CITY COMMISSION; PROVIDING FOR AN ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION PURSUANT TO SECTION 196.1995, FLORIDA STATUTES; PROVIDING FOR COORDINATION WITH THE SUPERVISOR OF ELECTIONS; PROVIDING FOR SEVERABILITY AND AN EFFECTIVE DATE WHEREAS, the City is granted the authority under Section 2(b), Article VIII of the State Constitution to exercise any power for municipal purposes except when expressly prohibited by law; and WHEREAS, section 196.1995, Florida Statutes, authorizes, upon approval by the municipal electorate in a referendum, a municipality to grant ad valorem tax exemptions to new businesses and expanding existing businesses; and WHEREAS, the City Commission desires to expand the commercial and industrial tax base of the City of Winter Springs by attracting new businesses and expanding existing businesses within the City of Winter Springs; and WHEREAS, the City Commission desires to continue to promote and enhance the economic climate within the City of Winter Springs by making it financially attractive and by creating additional local jobs through ad valorem tax incentives for new businesses to locate in the City and for existing businesses in the City to expand; and WHEREAS, the City Commission has determined that it could assist and improve the long term economic climate of the City, and promote the public interest, health, safety, and welfare of the citizens of the City of Winter Springs, to propose to the electorate that the City Commission be authorized to grant property tax exemptions to new businesses and expansions of existing businesses pursuant to Section 3, Article VII of the State Constitution and section 196.1995, Florida Statutes; and WHEREAS, the City Commission recognizes that if the electorate of Winter Springs grants the authority requested hereunder, ad valorem tax exemptions can only be approved on a case-by-case basis under the criteria specifically established under Florida law; and WHEREAS, the City Commission of the City of Winter Springs, Florida, hereby finds this ordinance to be in the best interests of the public health, safety, and welfare of the citizens of Winter Springs. City of Winter Springs Ordinance No. 2009-05 NOW, THEREFORE, THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS HEREBY ORDAINS, AS FOLLOWS: Section 1. Recitals. The foregoing recitals are hereby fully incorporated herein by this reference as legislative findings and the intent and purpose of the City Commission of the City of Winter Springs. Section 2. Referendum Election. A referendum election is hereby called and shall be scheduled to be held by the City Commission of the City of Winter Springs to determine whether the ballot question appearing in Section 3. hereof shall be approved by a majority of the votes cast in such election in which qualified electors residing in the City shall participate. Such referendum election shall be held and conducted in the manner prescribed by law for all elections. The date of the election shall be the date scheduled for the Florida Gubernatorial election in November of 2010, unless the City Commission directs that the election occur sooner. The places for voting in such referendum election shall be established for the election when the election is scheduled by the City Commission. All duly qualified electors of the City of Winter Springs shall be entitled to participate in said election. The date and method of voting of the election shall be coordinated by the City Clerk with the Supervisor of Elections of Seminole County. Section 3. Economic Development Ad Valorem Tax Exemption. (a) Purpose of question. It is proposed that the City of Winter Springs, Florida, be authorized to grant economic development ad valorem tax exemptions pursuant to section 196.1995, Florida Statutes, which provides that a municipality may call a referendum within its jurisdiction to determine whether the electorate in that jurisdiction will authorize that municipality to grant such exemptions under Section 3, Article VII of the State Constitution. Upon a majority vote in favor of such authority, the City may exempt, at its discretion and by ordinance, from ad valorem taxation up to one hundred percent (100%) of the assessed value of all improvements to real property made by or for the use of a new business, or up to one hundred percent (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 day the ordinance is adopted. (b) Ballot question. Concurrent with the election, when scheduled, the following question shall be placed on the ballot. The caption and questions shall be worded substantially as follows: ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION Shall the City Commission of the City of Winter Springs be authorized to grant, pursuant to s. 3, Art VII of the State Constitution, property tax exemptions to new businesses and expansions of existing businesses? City of Winter Springs Ordinance No. 2009-OS 2 YES For authority to grant exemptions. NO Against authority to grant exemptions. Section 4. Coordination with Supervisor of Elections. To the extent necessary, the City Clerk is hereby authorized and directed to instruct and coordinate with the Supervisor of Elections of Seminole County to include the above-described referendum question on the ballot concurrent with the election. Section 5. Severability. If any section, subsection, sentence, clause, phrase, word, or provision of this Ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction, whether for substantive, procedural, or any other reason, such portion shall be deemed a separate, distinct and independent provision, and such holding shall not affect the validity of the remaining portions of this Ordinance. Section 6. Effective Date. This Ordinance shall become effective immediately upon adoption by the City Commission of the City of Winter Springs, Florida, however, the ballot proposal in Section 3. shall only become effective if a majority of the registered electors of the City of Winter Springs, Florida who vote, in the election to be held as scheduled by the City Commission approve the ballot question set forth in Section 3.of this Ordinance. ADOPTED by the City Commission of the City of Winter Springs, Florida, in a regular meeting assembled on the 23rd day of March, 2009. ATTEST: Andrea Lorenzo-Luaces, City Clerk John F. Bush, Mayor Approved as to legal form and sufficiency for the City of Winter Springs only: ANTHONY A. GARGANESE, City Attorney First Reading: March 9, 2009 Second Reading: March 23, 2009 Effective Date: March 23, 2009 City of Winter Springs Ordinance No. 2009-OS ORDINANCE NO. 2009-OS AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, SEMINOLE COUNTY FLORIDA; PROVIDING FOR A REFERENDUM ELECTION AND BALLOT LANGUAGE FOR AN ELECTION TO BE SCHEDULED BY THE CITY COMMISSION; PROVIDING FOR AN ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION PURSUANT TO SECTION 196.1995, FLORIDA STATUTES; PROVIDING FOR COORDINATION WITH THE SUPERVISOR OF ELECTIONS; PROVIDING FOR SEVERABILITY AND AN EFFECTIVE DATE WHEREAS, the City is granted the authority under Section 2(b), Article VIII of the State Constitution to exercise any power for municipal purposes except when expressly prohibited by law; and WHEREAS, section 196.1995, Florida Statutes, authorizes, upon approval by the municipal electorate in a referendum, a municipality to grant ad valorem tax exemptions to new businesses and expanding existing businesses; and WHEREAS, the City Commission desires to expand the commercial and industrial tax base of the City of Winter Springs by attracting new businesses and expanding existing businesses within the City of Winter Springs; and WHEREAS, the City Commission desires to continue to promote and enhance the economic climate within the City of Winter Springs by making it financially attractive and by creating additional local jobs through ad valorem tax incentives for new businesses to locate in the City and for existing businesses in the City to expand; and WHEREAS, the City Commission has determined that it could assist and improve the long term economic climate of the City, and promote the public interest, health, safety, and welfare of the citizens of the City of Winter Springs, to propose to the electorate that the City Commission be authorized to grant property tax exemptions to new businesses and expansions of existing businesses pursuant to Section 3, Article VII of the State Constitution and section 196.1995, Florida Statutes; and WHEREAS, the City Commission recognizes that if the electorate of Winter Springs grants the authority requested hereunder, ad valorem tax exemptions can only be approved on a case-by-case basis under the criteria specifically established under Florida law; and WHEREAS, the City Commission of the City of Winter Springs, Florida, hereby finds this ordinance to be in the best interests of the public health, safety, anti welfare of the citizens of Winter Springs. City of Winter Springs Ordinance No. 2009-OS 1 NOW, THEREFORE, THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS HEREBY ORDAINS, AS FOLLOWS: Section 1. Recitals. The foregoing recitals are hereby fully incorporated herein by this reference as legislative findings and the intent and purpose of the City Commission of the City of Winter Springs. Section 2. Referendum Election. A referendum election is hereby called and shall be scheduled to be held by the City Commission of the City of Winter Springs to determine whether the ballot question appearing in Section 3. hereof shall be approved by a majority of the votes cast in such election in which qualified electors residing in the City shall participate. Such referendum election shall be held and conducted in the manner prescribed by law for all elections. The date of the election shall be the date scheduled for the Florida Gubernatorial election in November of 2010, unless the City Commission directs that the election occur sooner. The places for voting in such referendum election shall be established for the election when the election is scheduled by the City Commission. All duly qualified electors of the City of Winter Springs shall be entitled to participate in said election. The date and method of voting of the election shall be coordinated by the City Clerk with the Supervisor of Elections of Seminole County. Section 3. Economic Development Ad Valorem Tax Exemption. (a) Purpose of question. It is proposed that the City of Winter Springs, Florida, be authorized to grant economic development ad valorem tax exemptions pursuant to section 196.1995, Florida Statutes, which provides that a municipality may call a referendum within its jurisdiction to determine whether the electorate in that jurisdiction will authorize that municipality to grant such exemptions under Section 3, Article VII of the State Constitution. Upon a majority vote in favor of such authority, the City may exempt, at its discretion and by ordinance, from ad valorem taxation up to one hundred percent (100%) of the assessed value of all improvements to real property made by or for the use of a new business, or up to one hundred percent (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 day the ordinance is adopted. (b) Ballot question. Concurrent with the election, when scheduled, the following question shall be placed on the ballot. The caption and questions shall be worded substantially as follows: ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION Shall the City Commission of the City of Winter Springs be authorized to grant, pursuant to s. 3, Art VII of the State Constitution, property tax exemptions to new businesses and expansions of existing businesses? City of Winter Springs Ordinance No. 2009-OS YES For authority to grant exemptions. NO Against authority to grant exemptions. Section 4. Coordination with Supervisor of Elections. To the extent necessary, the City Clerk is hereby authorized and directed to instruct and coordinate with the Supervisor of Elections of Seminole County to include the above-described referendum question on the ballot concurrent with the election. Sect= Severability. If any section, subsection, sentence, clause, phrase, word, or provision of this Ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction, whether for substantive, procedural, or any other reason, such portion shall be deemed a separate, distinct and independent provision, and such holding shall not affect the validity of the remaining portions of this Ordinance. Section 6. Effective Date. This Ordinance shall become effective immediately upon adoption by the City Commission of the City of Winter Springs, Florida, however, the ballot proposal in Section 3. shall only become effective if a majority of the registered electors of the City of Winter Springs, Florida who vote in the election to be held as scheduled by the City Commission approve the ballot question set forth in Section 3.of this Ordinance. ADOPTED by the City Commission of the City of Winter Springs, Florida, in 2 regular-meeting assembled on the 23rd day of March, 2009. ~ - ~~~ . _ ~~_ J n F. Bush, I<•~ayor -' - ATTEST: _. .- , An orenzo-Luaces, City Clerk Approved to legal form and sufficiency for the C' of inter Springs only: ANTHONY A. GARGANESE, City Attorney First Reading: March 9, 2009 Second Reading: March 23, 2009 Effective Date: March 23, 2009 City of Winter Springs Ordinance No. 2009-OS 3