Gov. Scott signs economic development package, billion-dollar savings for businesses

Flanked by leaders of Florida's top economic trade groups and agencies, Gov. Rick Scott signed a number of business tax cuts he says will accelerate economic development in the state.

“The passage of my jobs passage is a great example of all of us working together to make Florida the best state to live and do business,” he said Wednesday.

The economic development package includes more than $1 billion in tax cuts for businesses over the next three years. It features broad cuts of the unemployment tax and the corporate income tax, and targeted reductions for manufacturers, private plane repairers, and fruit and meat packers.

Scott said it’s difficult to say definitively how certain targeted tax cuts will lead to job creation, but noted that the package helps make Florida a more competitive state for business expansion.

“If we want employers to hire more people, we’ve got to think like they do,” said Scott, a former CEO. “We’ve got to keep their costs as low as they can. We’ve got to make sure that we’re more competitive than any jurisdiction in the world.”

The public signing is the latest in a public relations push by Scott to shape the discussion about the job he's done as jobs governor.

In Legislature's tax-cutting spree, well-connected businesses win out

TALLAHASSEE -- William Ibarra was pleasantly surprised to learn that the taxes he pays at his small Miami charter flight company would be slashed by thousands of dollars, after the Legislature last week passed a slew of business tax cuts.

Frank Stronach, a billionaire horse breeder whose Gulfstream Park racino has a team of nine lobbyists in Tallahassee, could save millions. He is likely to benefit from corporate tax cuts for his businesses and a $1.2 million tax break carved out specifically for a slaughterhouse he is building near Ocala.

From shop owners, who know little about Tallahassee politics, to the powerful business lobby that thought up many of carefully crafted tax breaks, the Legislature this year proved a friendly place.

The total package of business tax relief approved during the 60-day legislative session that ended Friday totaled about $750 million this year, and more than $2.5 billion over the next three years.

Everyday consumers received a much smaller package of direct tax relief — another back-to-school tax holiday, small homestead exemptions and no tax increases. The Legislature was also less ambitious in providing direct economic relief for struggling homeowners, and delivered bone-deep cuts to several programs.

Backed by businessman-turned-governor Rick Scott, the business-friendly tax plan has been touted as a surefire way to bring Florida’s wounded economy back to life.

“If we put Florida companies in the position where we can outcompete companies in any other state, in any other country, what happens?” Scott asked during his State of the State speech in January. “Jobs are going to grow like crazy.”

Read the story here: 

 Here's a breakdown of the tax relief measures that passed this year.

--@ToluseO

 

Last-minute amendment could provide $800 million in tax relief for business

Since 2009, Florida has borrowed more than $2 billion from the federal government to help make payments on unemployment compensation claims. 

A recently filed amendment would slow down the repayment of that huge debt in order to provide businesses additional tax relief worth $800 million over the next three years.

The payments would be shifted into the second half of the decade, while the trust fund used to pay claims would be left underfunded, likely until 2018. If another recession happens in the meantime, the state would probably have to go back to the feds, hat in hand.

Last month, Florida lawmakers passed a series of memorials urging Congress to curb spending and reduce its debt in order to get its finances in shape.

Meanwhile, the state’s unemployment tax debt to the federal government continues to balloon. Florida had to pay more than $56 million in interest on the federal government loan last year, and the feds have been cracking down on the leveraged state by reducing credits.

Now, a business-friendly amendment could increase that debt, while giving companies an $800 million break in the final days of the legislative session.

On Thursday morning, Sen. Ellyn Bogdanoff, R-Fort Lauderdale, slipped an amendment onto an unemployment compensation bill (HB 7027) that would save companies as much as $350 million this year. Chiefly backed by a coalition of business groups, the amendment would require Florida to delay its plan to shore up its UC finances by reducing the base wage used to calculate the UC tax, and increasing the recoupment timeline.  

State budget talks move forward, but biggest sticking points remain

State lawmakers made significant headway on the budget Saturday, reaching consensus on economic incentives and spending on transportation, prisons and law enforcement.

But they had yet to find a compromise in the two most controversial parts of the spending plan: education and health and human services.

“We just opted not to go through that first,” House Budget Chairwoman Denise Grimsley, R-Sebring, said. “We’ll get to it, hopefully, tomorrow.”

The chambers must align their budgets by Tuesday to bring the Legislative session to a timely close. The Senate had proposed a $71 billion budget. The House version was $69 billion.

On Saturday, lawmakers agreed on an $86 million package of economic incentives aimed at bringing companies to Florida.

After initially disagreeing on how much power Gov. Rick Scott should have over the pot of incentive money, the Senate and House came together on an agreement to give the governor $61 million to use as he sees fit. An additional $25 million in incentives — grants, tax cuts and the like — would have to be approved by legislators.

Story here: 

 @ToluseO

 

Tax cut for Marlins stadium passes, despite constitutional problems

Ignoring warning signs by their own staff that a tax cut for the Miami Marlins stadium parking garage is probably unconstitutional, the House Committee on Economic Affairs passed the proposal, unanimously and without debate.

A staff analysis landed yesterday that cast serious doubt on the constitutionality of the plan –- which would cover up for a poorly inked deal with the Marlins that left the city of Miami on the hook for $1.2 million in property taxes.

Rather than changing the language to address the constitutional problems, the bill sponsor, Rep. Matthew Caldwell, R-Lehigh Acres, filed an amendment making the proposal retroactive to the 2012 tax bill, in effect doubling down on the constitutionally-questionable measure.

The Marlins parking garage section of the bill, filed by Rep. Jose Diaz, R-Miami on behalf of Rep. Carlos Lopez-Cantera, R-Miami, would exempt the city of Miami from paying property taxes.

It’s the Legislature’s latest move that critics say bucks the state’s Constitution.

"Robbing Peter to pay Paul?": Money from online taxes could go to new biz tax cuts

Florida lawmakers voted to move forward a proposal that would force online-only companies—and people who buy goods on the Internet—to pay the state’s 6-percent sales tax. 

Once shunned by conservative legislators averse to new taxes, the proposal has been packaged in a new “revenue neutral” form, meaning whatever money brought in by new taxes would be offset by tax cuts. Until now, it was widely believed that the money would go back to consumers in a new tax holiday.

However, a new amendment to the bill’s language allows for Tallahassee lawmakers to decide who gets the break. In the business-friendly climate of the Legislature, the money could go to reducing taxes on businesses, not directly to consumers. On Wednesday, the House passed a $120 million package of tax cuts on businesses, ranging from reductions to the corporate income tax to reducing taxes on private plane repair.

According to Sen. Nancy Detert, R-Venice, the bill's sponsor, the online tax revenue should go to cutting business taxes.

Gov. Scott's biz tax-cut plan clears House

Gov. Rick Scott’s $120 million business tax cut plan passed the House by a wide margin Wednesday, a day after partisan bickering dominated debate on the issue.

The tax plan, a priority of Scott (Download ScottTaxPriorities), would double the corporate income tax exemption, from $25,000 to $50,000, meaning 3,770 companies would be exempt from paying any income taxes.

Scott has said he would like to completely phase out the state’s corporate income tax, in order to make Florida more business-friendly. Companies paid nearly $2 billion in state income tax last year, about 8 percent of all revenue collected by Florida.

Several other parts of the tax package would cut costs for thousands of businesses and reduce revenue in the state. The measures would slash taxes on oil drilled in Florida (by $3.3 million), manufacturing equipment ($56.4 million), private plane repair ($12.3 million) and electricity at produce packing houses ($1.1 million).

State legislators opt for tax cuts the easy way; Locals left with the bill

The Florida Legislature is eyeing even more tax cuts this year, celebrating its free-market ethos by slashing business taxes and allowing consumers to “keep more of their own money.”

But as lawmakers take credit for handing out tax cuts to businesses and homeowners, most are not coupling the revenue reductions with equal-sized cuts in spending, leaving local governments to sort out how to balance their budgets.

“We’re trying to take credit for cutting taxes when we’re, in essence, really just telling somebody else ‘You need to cut,’” Rep. Fred Costello, R-Ormond Beach, warned fellow lawmakers during a committee meeting where lawmakers approved more than $600 million in cuts to local governments.

In total, the Legislature has advanced proposals for several billion dollars in new unfunded tax cuts that, if passed, will come out of the coffers of cities and counties across the state. Local governments, which have hired lobbyists to fight back against some of the cuts, say state lawmakers are leaving them with a bleak choice: Either cut already-pared-back services and salaries to offset billions of dollars in reduced revenue, or raise property tax rates to cover some of the shortfall.

Read the rest of the story here.

--@ToluseO

 

Negron gets support for bill to repeal ballot access of budget and tax commissions

Although the Florida Legislature's latest popularity polls are in the dump, Sen. Joe Negron is pretty convinced that the public wants lawmakers, and not citizen commissions, to fix what's wrong with the state Constitution.

Negron's bill to ask voters to repeal the Constitutional Revision Commission and the Tax and Budget Reform Comission passed the Senate Judiciary Committee Thursday. Only Sen. Arthenia Joyner, D-Tampa, voted against it.

Florida's Constitution uniquely allows the two bi-partisan commissions to put changes to the constitution directly onto the election ballot, bypassing the other two entities with access to the ballot, the citizen initiative process and the Florida Legislature. The Constitutional Revision

PolitiFact Florida rates Gov. Rick Scott on his promise to veto pork-barrel spending

Gov. Rick Scott promised during his campaign to "veto what the legislators call 'turkeys' — costly and unnecessary pork-barrel products."

Where do you think he rated on the Scott-O-Meter? PolitiFact Florida makes the call.