Business leaders lobby lawmakers to restore Florida’s target industry tax refund | Florida
(The Center Square) – Lawmakers must restore a lapsed performance-based tax refund program to accelerate a post-pandemic recovery, business leaders said during a Florida Chamber of Commerce forum.
Florida’s 26-year-old Qualified Target Industry Tax Refund Program (QTI) expired in June after lawmakers failed to reauthorize it.
The QTI “has probably been one of the most beneficial things we’ve done because this is performance based, a performance-based incentive,” Florida Secretary of Commerce Jamal Sowell said Thursday during the Florida Chamber of Commerce’s 2021 Economic Outlook & Jobs Solution Summit.
The three-hour virtual forum featured 15 speakers and panel discussions on post-pandemic recovery and the chamber’s Florida 2030 Blueprint, which outlines initiatives to grow the state’s $1.11 trillion economy from 17th to 10th largest in the world by 2030.
According to the Florida Department of Economic Opportunity (DEO), between its 1994 enactment and 2019, more than 1,360 businesses participated in the QTI program, with more than $260 million in tax refunds awarded, helping the state secure billions in investment and thousands of high-wage jobs.
Since 2014, the DEO documents, more than 320 businesses have participated in QTI, creating nearly 30,000 jobs across the state.
The QTI provided a tax refund of $3,000 a new job created in Florida through the expansion of existing Florida businesses or the relocation of new ones. The refund increased to $6,000 a job within Enterprise and Rural County zones.
Under the program, recipients could claim refunds from sales, documentary stamp, property, corporate income, insurance premium and state communications services taxes.
A business was eligible for a $1,000-a-job QTI tax refund if it paid more than 150% of the area’s average wage, and a $2,000-a-job refund if it paid more than 200% of the area’s average wage.
Qualifying businesses could recoup no more than 25% of their total refund, and no more than $1.5 million in tax refunds, in a single fiscal year.
A bill to restore the QTI program has not been filed for the 2021 legislative session, which begins March 2. Legislation to do so in 2020 fell short of adoption.
Senate Bill 922, filed by Sen. Joe Gruters, R-Sarasota, would have made the QTI program permanent.
SB 922 passed the Senate, 39-0, on March 9. It died in the House when the session adjourned three days later. House Bill 779, a companion bill sponsored by Rep. Spencer Roach, R-Fort Myers, never advanced after being introduced.
Extending the QTI faces challenges from opponents who say taxpayer-subsidized incentives are unneeded. The QTI is a subsidy, critics insist, because refunded tax revenues are replaced by dollars from other taxpayers.
During a Chamber panel in early January, Rep. Chip LaMarca, R-Lighthouse Point, reflected that view when he said Florida must compete with 40 states that offer incentives for development but “we don’t need to hand out money to get business here.”
In support of 2020’s SB 922, the DEO argued QTI does not “hand out money,” stating, “Unlike other programs, the QTI Tax Refunds are paid once jobs are created, taxes are paid and performance is verified.”
Florida Power & Light Senior Director for Economic Development Crystal Stiles said QTI made Florida competitive without offering “no-questions-asked incentives.”
Stiles joined Sowell and Duke Energy Florida Director of Economic Development Marc Hoenstine in Thursday’s Chamber forum in claiming Florida has lost – and will continue to lose – high-paying jobs to states such as North Carolina without restoring QTI.