Economic Incentive Package Sparks Critique In The House
The Florida House took up the Governor’s primary economic development proposition. But House lawmakers are pulling out all the stops in hopes of getting it across the finish line.
In state government terms, Christmas comes when the governor signs the annual budget. And this year, Governor Rick Scott has been clear there are two things he wants to see under the tree. One billion dollars in tax cuts, and another quarter billion in Enterprise Florida funding.
He may be disappointed.
The Senate is open to the Enterprise Florida proposal, but it’s less interested in a big tax cut. The House is just the opposite. Its tax cut package tallies close to the governor’s dollar amount, but many members—from both sides of the aisle—are hostile to the business incentives Enterprise Florida doles out. That hasn’t stopped the idea from making it to the floor.
“This bill is a framework bill only,” Rep. Jim Boyd (R-Bradenton) says. “It strengthens the process that we’re currently under it provides no dollar allocation in this bill for any part of this program.”
Boyd’s sponsoring the measure in the House. So what’s his tactic to move the bill through a chamber skeptical of attracting businesses with economic incentives? He just stripped out the appropriation completely. The move drew criticism from St. Petersburg Democrat Darryl Rouson.
“So at some point this bill will have a fiscal [impact],” Rouson asks, “we just don’t know what it is at this point and we’ve not offered anything towards what the Senate has put in?”
Some Republicans took issue with the approach as well. And it’s not hard to see why—the GOP’s calling card is fiscal responsibility, but under Boyd’s approach, the House would relinquish the debate over funding to the budget conference committee. Ormond Beach Republican Fred Costello asks about whether lawmakers will get to vote on the amount of the appropriation.
“If I understood you correctly earlier the House is at zero, Senate’s at $250 million,” Costello says. “Is the only time that we have an opportunity to vote whether we support this program or not on this bill or will there be a separate vote for how much money the house ends up compromising with the senate other than only the vote up or down for the budget?”
Boyd attempts to elide the question, but the answer yes. And the—we’ll call it legislative creativity—isn’t limited to dropping the appropriation.
“Representative—can you tell me why this bill did not go to the next committee of reference before coming to the floor?” Gwyn Clarke-Reed (D-Deerfield Beach) asks.
Thanks to a late change by House leadership, the measure only had to pass one committee before heading to the House floor, while most bills have to run a three-committee gauntlet.
“That’s a bit above my paygrade,” Boyd explains.
The measure came in for a number of other criticisms as well. House Democrats attempted to add an amendment giving teeth to an existing statutory requirement that Enterprise draw half its funds from the private sector. Boyd says the organization is already complying with the law, and no government reporting has shown otherwise.
A 2004 report from legislative researchers put the split closer to 85/15 in favor of taxpayer funds. More recent outside reports have found a similar balance.
Democrats also took Boyd task for lowering return on investment requirements. But ROI has been one of Gov. Scott’s biggest talking points for Enterprise Florida. Here is at the Enterprise board meeting in August of last year.
“So the return for Enterprise Florida transactions in the last four and a half years has been ten times,” he said. “We got ten times the money we put up, so for our taxpayers if we put up and hundred thousand dollars we’re getting ten times that back in tax revenue to the state.”
“Now Shad you’re an investor—would you do that deal? Like—every day, right?”
Shad is Shad Khan, owner of the Jacksonville Jaguars, and the statutory benchmark is actually half that just five to one. Boyd’s measure cuts the requirement lower—down to just three to one.
Tuesday’s discussion is the bill’s second reading. It’s a phase of the floor process where lawmakers ask questions of the sponsor. The measure is likely to come up for debate and a final vote when the House takes the floor Wednesday.