Miami-Dade Legislative Item
File Number: 130495
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File Number: 130495 File Type: Ordinance Status: Before the Board
Version: 0 Reference: Control: Board of County Commissioners
File Name: SALES TAX EXEMPTION IN COUNTY CONSTRUCTION CONTRACTS Introduced: 3/15/2013
Requester: NONE Cost: Final Action:
Agenda Date: 6/4/2013 Agenda Item Number: 7I
Notes: SEE 132465 FOR FINAL VERSION AS ADOPTED. Title: ORDINANCE ESTABLISHING SALES TAX EXEMPTION PROGRAM; PROVIDING FOR TAX EXEMPT OWNER PURCHASED MATERIALS IN CONSTRUCTION CONTRACTS; DEFINING APPLICABILITY; REQUIRING THE INCLUSION OF SPECIFICATIONS IN APPLICABLE CONTRACTS TO ALLOW FOR TAX EXEMPT PURCHASES; PROVIDING FOR EXPEDITED COUNTY PURCHASING OF OWNER PURCHASED MATERIALS; PROVIDING FOR REPORTS ON TAX EXEMPT PURCHASES; DIRECTING THE CREATION OR AMENDMENT OF IMPLEMENTING ORDERS; CREATING SECTION 2-10.7 OF THE CODE, PROVIDING SEVERABILITY, INCLUSION IN THE CODE AND AN EFFECTIVE DATE
Indexes: CONSTRUCTION
  CONTRACT
  SALES TAX
Sponsors: Juan C. Zapata, Prime Sponsor
  Lynda Bell, Co-Sponsor
  Audrey M. Edmonson, Co-Sponsor
  Sally A. Heyman, Co-Sponsor
  Rebeca Sosa, Co-Sponsor
Sunset Provision: No Effective Date: Expiration Date:
Registered Lobbyist: None Listed


Legislative History

Acting Body Date Agenda Item Action Sent To Due Date Returned Pass/Fail

Board of County Commissioners 6/4/2013 7I Amended
REPORT: SEE LEGISLATIVE FILE NO. 132465 FOR AMENDED VERSION.

Finance Committee 5/14/2013 1F2 Forwarded to BCC with a favorable recommendation P
REPORT: Assistant County Attorney Geri Bonzon-Keenan read the foregoing proposed ordinance into the record. Commissioner Zapata noted this foregoing proposed ordinance would allow the County to save money by purchasing materials using its tax exempt status. Chairman Bovo opened the public hearing on the foregoing proposed ordinance. Chairman Bovo closed the public hearing after no one appeared wishing to speak. Commissioner Moss questioned the methods that would be used to ensure that the County received the tax exemption benefits and to prevent contractors from submitting higher bids to increase their profits. Mr. Lester Sola, Director, Internal Services Department, explained that the County would be the purchasing agent for the contractors, would monitor every purchase, and would share the savings generated by not paying sales tax. He noted the department was fully aware of the costs and profits associated with specific project budgets. Mr. Sola indicated that the market would keep contractors honest since they would all be submitting bids under the same provisions of the sales tax purchase program. Commissioner Moss expressed his support for this item, and said that he would be presenting similar legislation on workers’ compensation issues in the future. Commissioner Heyman expressed her support, noting this effort would provide additional savings to the County. Commissioner Heyman asked to be listed as a co-sponsor to the foregoing proposed ordinance. Hearing no further questions or comments, the Committee members proceeded to vote on this proposed ordinance, as presented.

Board of County Commissioners 4/2/2013 Tentatively scheduled for a public hearing Finance Committee 5/14/2013

Board of County Commissioners 4/2/2013 4J Adopted on first reading 5/14/2013 P
REPORT: The foregoing proposed ordinance was adopted on first reading and scheduled for a public hearing before the Finance Committee on May 14, 2013 at 9:30 a.m.

County Attorney 3/18/2013 Referred Finance Committee 5/14/2013

County Attorney 3/18/2013 Assigned Hugo Benitez 3/19/2013

Legislative Text


TITLE
ORDINANCE ESTABLISHING SALES TAX EXEMPTION PROGRAM; PROVIDING FOR TAX EXEMPT OWNER PURCHASED MATERIALS IN CONSTRUCTION CONTRACTS; DEFINING APPLICABILITY; REQUIRING THE INCLUSION OF SPECIFICATIONS IN APPLICABLE CONTRACTS TO ALLOW FOR TAX EXEMPT PURCHASES; PROVIDING FOR EXPEDITED COUNTY PURCHASING OF OWNER PURCHASED MATERIALS; PROVIDING FOR REPORTS ON TAX EXEMPT PURCHASES; DIRECTING THE CREATION OR AMENDMENT OF IMPLEMENTING ORDERS; CREATING SECTION 2-10.7 OF THE CODE, PROVIDING SEVERABILITY, INCLUSION IN THE CODE AND AN EFFECTIVE DATE

BODY
BE IT ORDAINED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA:
Section 1. Section 2-10.7 of the Code of Miami-Dade County is hereby created to read in its entirety as follows:
2-10.7. Sales Tax Exemption Program

(a) Creation. It is the policy of the County to apply for and use to the maximum extent the sales tax benefits and exemptions made available to the County by the State of Florida. By operation of law, Miami-Dade County is exempt from sales taxes for certain purchases made directly to the County of materials and supplies which may ultimately be utilized or incorporated in County construction projects. Further, by operation law, Miami-Dade County is entitled to certain sales tax refunds based on the types of purchases involved in the conduct of its business and proprietary functions. To advance the County’s policy, this Section establishes a sales tax exemption program.

(b) Tax Exempt Owner Purchased Materials.

1. The County shall incorporate specifications for tax exempt owner purchases in all covered contracts. A tax exempt owner purchase is one made directly by the County which is intended to be tax exempt in accordance with Section 212.08(6) of the Florida Statutes and Rule 12A-1.094 of the Florida Administrative Code, as the same may be amended. A covered contract is a contract for the construction, improvement or rehabilitation of property which is estimated to exceed five million dollars ($5,000,000.00) in cost.

2. The specifications for tax exempt owner purchases shall maximize the sales tax benefits available to the County, shall be in compliance with the statutory and regulatory requirements for obtaining the exemption and shall at minimum: (i)provide for obtaining a Technical Assistance Advisement Letter from the Department of Revenue; (ii) establish a process for the integration of owner purchases with contractor deliverables; (iii) provide for the securing, insuring and accounting of owner purchases and (iv) provide for the effect of owner purchases on any applicable contractual Community Small Business Enterprise (CSBE) goals.

3. The requirements of this Subsection may be waived by the Board of County Commissioners upon written request of the Mayor. The Mayor’s request shall set forth the reasons why owner purchases under the subject contract are not in the best interest of the County, which may include, but are not limited to contracts with unique purchasing constraints requiring the expertise of the contractor, instances where the savings from application of the program are minimal in comparison with the cost of administration of the program, and instances where the anticipated pace or scheduling of the work would not permit the timely completion of County purchases.


4. The County Mayor shall expedite owner purchases under the program, including, where appropriate, evaluating the possibility of recommending the waiver of competitive bidding as necessary to comply with scheduled deliverables for the subject project.

(c) Other tax benefits and refunds relating to County purchases. The County shall wherever possible maximize the tax benefits and refunds available to the County in connection with County purchases. Commencing ninety (90) days after the effective date of this Section, and every year thereafter, the Mayor shall report to the Board the efforts of the County to maximize its tax benefits and refunds. In particular, and without limitation, the report shall set forth how the County has availed itself of the sales tax exemptions and refunds on account of use provided for under Section 212.08(5) which may include those available for building materials used in the rehabilitation of real property located in an enterprise zone, and those for building materials in redevelopment projects.

Section 2. The Mayor is hereby authorized and directed to create and amend the County’s implementing orders as necessary to give effect to this ordinance. Such implementing orders or amendments shall be submitted to this Board for approval.
Section 3. If any section, subsection, sentence, clause or provision of this ordinance is held invalid, the remainder of this ordinance shall not be affected by such invalidity.
Section 4. It is the intention of the Board of County Commissioners, and it is hereby ordained that the provisions of this ordinance, including any sunset provision, shall become and be made a part of the Code of Miami-Dade County, Florida. The sections of this ordinance may be renumbered or relettered to accomplish such intention, and the word ''ordinance'' may be changed to ''section,'' ''article,'' or other appropriate word.

Section 5. This ordinance shall become effective ten (10) days after the date of enactment unless vetoed by the Mayor, and if vetoed, shall become effective only upon an override by this Board.



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