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TALLAHASSEE (CBSMiami/NSF) — A key Senate budget chairman will recommend that Gov. Rick Scott get his wish for $250 million to recruit businesses to Florida.
Senate Transportation, Tourism and Economic Development Appropriations Chairman Jack Latvala said Monday he will ask that the incentive money be included in his panel’s proposed budget for the fiscal year that starts July 1. The subcommittee’s proposal is due Thursday.
Latvala said his proposal is both an olive branch and philosophical agreement with the governor, who has ardently pushed for the economic incentives and for more than $1 billion in tax cuts.
“I think it’s important that we acknowledge the priority of creating jobs and that we all try to work in that direction and we acknowledge that we do it collaboratively,” Latvala said.
Bill Johnson, Scott’s top business recruiter, has had several contentious appearances before Senate committees over how recruitment dollars are earmarked and secured. A year ago, Scott asked for $85 million for incentives and lawmakers gave $43 million to Enterprise Florida, the state’s public-private economic development agency.
Asked for comment on Latvala’s announcement, Scott’s spokeswoman Jackie Schutz replied in a statement that “Gov. Scott expects to end the legislative session strong with a $1 billion tax cut and a $250 million dedicated Florida Enterprise Fund, just as he started the session off strong by signing into law (Senate) President (Andy) Gardiner’s unique abilities legislation and (House) Speaker (Steve) Crisafulli’s water legislation.”
Schutz was referring to Gardiner’s priority of boosting educational and job opportunities for people with developmental disabilities and Crisafulli’s priority of passing statewide water policy. Lawmakers approved the proposals during the first week of the legislative session, and Scott signed them last week.
To accommodate the funding request, Latvala said he is advising members that they look at other areas — including local member projects — to “trim.”
“I think by setting aside the $250 million, we’re sending a pretty loud signal that we want to end up in a comfortable place and give him the tools he needs for business recruitment and business retention,” Latvala said. “Exactly how that $250 million gets spent is really secondary to the fact that we’re going to put it out there, we’re going to tell America, all the companies in America, that we’re going to have this money.”
Senators will have to determine if the incentive money is placed in reserves as requested by the governor’s office or through a process called “pay as you go” that state economists say holds the money until a company reaches contractual obligations.
The funding proposal came after state economists last week slashed almost $400 million from their forecast for state tax collections over the next 18 months, something that was expected to force budget-writers to try to squeeze the priorities of the Legislature and Scott into a smaller spending plan.
Latvala’s comments came after the Senate Commerce and Tourism Committee on Monday unanimously backed his proposal that starts to set up how incentive funds can be allocated.
The proposal includes changes to programs for the sports and film industries, including designation of the Entertainment Action Fund as the pool from which production companies could apply and receive state money.
The changes to the film-industry incentives is considered a priority of Commerce and Tourism Chairwoman Nancy Detert. She contends the proposal isn’t like a 2010 incentive program in which $296 million was set aside.
That money was expected to last five years but instead was quickly depleted as it was awarded on a first-come, first-served basis.
“What we’re doing is taking a non-competitive tax credit program and replacing it with a competitive program that favors productions which maximize return on the state’s investment,” Detert said.
On Monday, the committee backed additional changes to the bill that would require money from the state’s Quick Action Closing Funds — to be renamed the Florida Enterprise Fund — come with the promise of at least 10 new jobs. Among other things, all deals would have to provide a 3-to-1 return on investment instead of the current 5-to-1 return and the state would track the number of new jobs in which employees receive health benefits through the companies.
Sen. Garrett Richter said the health care proposal follows a Texas incentive requirement — Scott often refers to business practices in Texas, where he once worked as an attorney — and would provide a better snapshot of the “quality” of the jobs being created.
Melissa Fausz of the conservative-advocacy group Americans for Prosperity Florida, which considers incentives “corporate welfare spending,” said Florida shouldn’t follow Georgia and other incentive-offering states.
“Those states have mortgaged their futures in exchange for ribbon-cutting ceremonies and their state logo at the end of a film reel,” Fausz said. “And Georgia is now facing a $2 billion gap in their state budget and is looking at a $1 billion tax increase to make ends meet.”
The News Service of Florida’s Jim Turner contributed to this report.