BusinessClimate

After years of dynamic growth and changes

to its economy, it has become clear that

Florida can no longer compete primarily as

a low cost state. While this is a sign of progress for

Florida, it puts increasing pressure on the state to

ensure that it provides an overall business climate

that supports the creation, growth, retention, and

recruitment of companies.

Competitive, predictable business costs, a friendly

tax and regulatory environment, and other

business considerations are essential.

In addition, as structural changes occurring in

the economy create new drivers of economic

competitiveness, Florida must remain vigilant in

adapting its business climate accordingly.

business climate For the innovation

economy

STRATEGIC PRIORITY:

60

2010 -2015 Strategic Plan for Economic Development

Florida needs to jump start its economy not just for the short-term, but for long term success in the innovation economy. We must develop policies with a renewed understanding of competitiveness that will enable Florida to succeed in changing times with a new direction.

Allan Bense Vice Chair, Enterprise Florida

According to a recent Florida TaxWatch analysis, Florida

generally fares well in state business climate rankings.

Florida’s strengths include its absence of a personal yincome tax, relatively low unemployment insurance taxes, openness in trade, and friendliness to small business and entrepreneurs.

Weaknesses include high business costs, including yproperty tax burdens, state and local taxes, and general business costs (e.g. electricity costs and rents).

Given the complexity of comparing data across states, ybusiness rankings typically do not include measures of permitting/regulatory delays or compare incentive funding levels. Nonetheless, these remain areas of critical concern for Florida’s business and economic development communities.

Forum Photo

Where We Are Today and Where We Need to Be

What You Told UsAt regional planning forums across the state, Florida’s economic development stakeholders focused on the need to make Florida friendlier to small businesses, more focused on the growth of existing companies, better align business development tools with changing business needs, address a roller coaster property insurance market, and find ways to fund the state’s priorities.

Florida’s economic development leaders expressed particular concern about the size of Florida’s incentive toolkit relative to other states and the need to reduce regulatory and permitting delays that cost businesses money and slow or derail projects.

612010 -2015 St r ate gic Plan f o r Economic D eve lo p ment

Where We Are Now

MAjor BusinEss CliMAtE rAnking sourCE

FloridA’s rAnk AMong stAtEs

American Legislative Exchange Council 11

Beacon Hill Institute 32

Corporation for Enterprise Development C/C/d

CNBC 17

Forbes 8

Fraser Institute 4

New Economy 23

Site Selection 13/9

Small Business and Enterprise Council 5

Tax Foundation 5

Allan Bense, Enterprise Florida Vice Chair, moderating a state roundtable discussion on business climate issues. Panelists included (left to right): Secretary of the Department of Community Affairs Thomas Pelham, Assistant Secretary of the Department of Transportation Debbie Hunt, Representative Marti Coley, President of the Florida Council of 100 Susan Pareigis, Commissioner of the Department of Education Eric Smith, and Senator Al Lawson.

94% of online survey respondents agree that ensuring a competitive business climate is still a leading priority and critical to the state’s economic future.

2010 -2015 St r ate gic Plan f o r Economic D eve lo p ment62

Competitive Business Climate

R o A d m A p R e c o m m e N d A T i o N s

smAllBUsiNess

Small business is the backbone of

Florida’s economy.

RegUlAToRY eNviRoNmeNT

Florida needs an

efficient regulatory system relative to

its competitors.

cosT compeTiTiveNess

Florida is no longer a low cost state, but must meet bottom

line needs.

compeTiTive iNceNTive

ToolkiT

Changing economic conditions impact the

competitiveness of Florida’s economic

development toolkit.

Recommendation #1

Strengthen Florida’s incentive toolkit for

the 21st century.

Recommendation #2

Provide a business climate conducive

to entrepreneurship and small business

development.

Recommendation #3

Improve the state and local regulatory

environment.

Recommendation #4

Provide predictable, competitive business

costs

r e s p o n s i v e t o a d y n a m i c e c o n o m y

BuSInESS ClImATE


Florida’s incentive toolkit is used both to help

stimulate job creation in the near term and support

long-term economic growth in Florida’s targeted

industries and areas of special need. It has a

long and successful track record of generating

significant returns in the form of business

investment, high wage job creation, tax base

growth, and more. The current downturn, however,

has brought to the fore several competitive

weaknesses in Florida’s existing toolkit. Structural

changes taking place at

the macroeconomic level

nationally have caused

competitor states to adopt a

more aggressive posture with

incentives. This environment,

coupled with changes in

Florida’s own economic

structure, make it both a

necessary and ideal time to

re-evaluate Florida’s existing

incentive programs to make

adjustments and fill gaps.

ACTIOn ITEmS

Accelerate job creation for economic recovery

Promote productivity gains through capital investment

Expand corporate r&d

Expand the number of corporate head-quarters in Florida

Accelerate Job creation for economic Recovery Florida is struggling to emerge from a two year recession that has

significantly impacted businesses and led to an unemployment

rate approaching 11%. Florida must focus on creating economic

opportunities today and into the future through programs that

help businesses of all sizes retain and build operations and provide

access to needed capital. Business retention and expansion must be

a core focus for near term job creation, particularly in a slow growth

environment.

Specific measures that can be taken in this regard include:

modify the Qualified Targeted Industry (QTI) program to X

jump start job creation and encourage business retention

and expansion.

Increase per job award for projects in high impact ysectors (corporate HQ, clean energy, transportation equipment manufacturing, life sciences, financial services, information technology and semiconductors).

Offer additional QTI state incentive dollars for higher ythan required local financial contribution.

Remove QTI $5 million lifetime business unit cap, as ythis is a disincentive for existing Florida businesses contemplating additional growth in this State.

Explore incorporating existing, underutilized rural yand urban incentives into QTI in an effort to enhance the ability of these programs to drive economic diversification in Florida’s target opportunity areas.

lower the investment threshold for High Impact X

Performance Incentives (HIPI) in order to enhance

availability of this attractive, yet fiscally conservative

incentive. Lowering the new job creation and capital

investment requirements for HIPI to 50 new jobs and $50 million

investment (25 jobs and $25 million for R&D projects) can help

to spur activity in high impact sectors. The performance-based

HIPI grants would provide critical cash infusion at strategic

points in a project’s timeline.

Fund the Quick Action Closing Fund. X The Quick Action

Closing Fund appropriation was reduced from $46.4 million in

FY 2008-09 to $13.46 million in FY 2009-10. While the precise

impacts of this decline will not be known for several months,

this change drastically inhibits Florida’s ability to compete

BUsiNess climATe RecommeNdATioN #1

Strengthen Florida’s Incentive Toolkit for the 21st Century

Adjustments should be made to Florida’s incentive toolkit following 3 broad principles:

• MaintainthevalueofFlorida’sincentivetoolkit—especially in light of significantly higher investment by national and regional competitors.

• Fine-tunesomeexistingincentivessothatthey can be more effectively deployed for immediate and emerging needs.

• Developnewtoolstoaddressgaps/respond to changing economic drivers.

# 1B U s i N e s s c l i m A T e R e c o m m e N d A T i o N


for important economic development projects—all at

a time when other states are increasing their economic

development efforts. For example, the Texas Enterprise

Fund discretionary cash grant was initially funded at $290

million in 2003 and has been maintained at a balance of $190

million as of August 2009. Georgia, North Carolina, New York,

Pennsylvania and Virginia also have similar discretionary deal

closing funds ranging from $15 million to $45 million.

promote productivity gains Through capital investmentCapital investment in new facilities and equipment is crucial to

manufacturers who must continually improve their products

and manufacturing processes to keep costs down and remain

competitive in global markets, and is key to increased productivity

and efficiency. In today’s environment of business consolidation

and the need to redistribute production volumes, Florida has

an opportunity to capture new capital investment, which leads

to preservation of existing jobs as well as downstream new job

creation.

Unfortunately, Florida ranks poorly—36th among states and 16%

below the national average—in average investment per employee

in manufacturing machinery and equipment. Florida also trails

the national average in worker productivity.1 As a result, Florida

needs incentives to more aggressively promote the adoption of

innovative technologies and production methods, or at the very

least, to remove disincentives for such investment.

In addition to enhancing productivity and competitiveness,

additional capital investment also leads to new direct and indirect

revenue streams at both the State and local levels. The additional

investment, much of which is taxable will enhance State sales and

use tax as well as corporate income tax. This investment will also

increase local ad valorem tax revenue by increasing the value of

personal property on the tax rolls.

Specific measures that can be taken in this regard include:

Eliminate the 10% expansion requirement for Florida’s X

manufacturing machinery and Equipment (mmE)

exemption. Florida’s MME exemption is available for new

and expanding businesses increasing productive output

by at least 10%, but is not available for replacing existing

equipment if the expansion threshold is not met. In contrast,

many of Florida’s key competitors—including Georgia,

Virginia, New York, North Carolina, and Texas—offer

complete exemptions (including replacement equipment).

Florida’s partial exemption presents a long-term

competitiveness weakness in promoting productivity growth,

as well as an immediate challenge. In the current economic

climate Florida’s 10% output expansion requirement climate

serves as a disincentive for capital investment decisions.

Some Florida manufacturers are deferring investment in

capital equipment because the market cannot presently

bear a 10% output expansion and sales tax exemptions are

important to the investment decision. This disincentive keeps

companies from making investment now that will improve

their competitiveness through economic recovery and into

the future.

Elimination of the 10% expansion requirement could also

mean the removal of the Semiconductor, Defense and

Space Technology (SDST) sales tax exemption, which

already exempts replacement equipment from sales tax for

businesses in these sectors.

Adjust the Capital Investment Tax Credit (CITC) program X

to expand its impact in encouraging capital investment

and effectiveness in supporting the growth of companies

in Florida. CITC is designed to attract and grow capital

intensive industries in Florida. However, its large thresholds

and industry restrictions often limits its applicability to

projects. Expanding eligibility and providing more flexible is

important to promoting greater capital investment.

Reduce the job creation requirement to 50 new jobs yin order to encourage investment in new technology and ensure Florida businesses remain competitive.

Expand CITC to all target industries. y

Allow the transferability of tax credits, providing ya revenue stream to innovative businesses. Small businesses that do not have State corporate income tax liability can still be induced to invest capital and create jobs. The transferability of tax credits will provide essential, predictable cash flow, which can be reinvested in the business to further advance productivity enhancements and new job creation.


expand corporate R&dR&D is the source of the discoveries and ideas that fuel innovation

and technological change—and is thus ultimately a key driver of

economic growth, competitiveness, and prosperity. As a result,

expanding Florida’s R&D base is vital for Florida’s long term

economic diversification and growth in an increasingly knowledge-

based and innovation-driven global economy. In particular, Florida

must ensure that it has a robust R&D base that is aligned with

industry needs.

According to the most recent data, Florida—the nation’s 4th most

populous state—ranks 16th among states in total R&D spending,

17th in total corporate R&D performed, 36th in terms of overall

corporate R&D intensity (R&D as a share of GDP). This poor/

under-performance in corporate R&D is a long standing strategic

challenge that has yet to be sufficiently addressed through the

state’s incentive toolkit.

Fortunately, proven policy options are available:

Enact a state R&D tax credit. X Research convincingly

shows that the federal R&D tax credit is an effective tool

for stimulating corporate R&D investment, which in turn

stimulates faster economic growth. Building on this success,

more than 30 states have created state-level R&D tax credit

programs. These state-level programs have also been shown

to increase corporate R&D investment and the number of

high technology establishments within a state.2

Include transferability of credits to provide a revenue ystream for innovative young companies that often cannot secure traditional financing and face capital gaps

Expand the Innovation Fund. X To date, the Innovation

Fund has played a leading role in attracting leading research

institutes and companies that have expanded innovation-

based economic activity both in their own right and through

spin-off generation. In addition, these high profile projects

have improved the state’s standing as an innovation state.

Over a cumulative 20 years, this investment is expected to

create an estimated $22.1 billion impact.

The Innovation Fund should be funded again at a significant

level and expanded to include the three initiatives to make

Florida’s innovation toolkit more robust:

Retain the Fund’s original use as an incentive for ythe attraction of corporate R&D facilities and non-profit research institutes with capital investments (example: threshold of $25 million) and the creation of high wage jobs (example: at least 25 jobs at 150 percent of the state average).

Consider adding a matching fund component to be yused by Florida universities to attract federal R&D centers and labs. The Fund would subsidize half the match required to compete nationally. (Note: R&D funding is increasing at the federal level. At the same time, most federal agencies are now requiring mandatory matches).

Add an equity partnership investment component yfor use in recruiting major corporate and non-profit R&D facilities, helping to fund start-up costs in return for a portion of royalties. The potential revenue stream generated would be returned to the Fund and/or used to help subsidize technology commercialization grants to continue to enhance Florida’s innovation economy.

Retain and promote the university match component X

of the Semiconductor, Defense, and Space Technology

(SDST) exemption, and broaden it to all manufacturers

under mmE. The SDST sales tax exemption currently

allows applicants to contribute the exempted value of the

sales tax to specific University research and development

efforts, if matched by the University. This program leads to

a unique partnership between businesses and educational

institutions for the advancement of collaborative research

efforts. Retaining this match component and broadening

it for all manufacturers will expand business and university

cooperation statewide in sectors beyond semiconductor,

defense and space.

expand the Number of corporate Headquarters in FloridaCorporate headquarters are valuable from an economic

development standpoint thanks to their high wage and high-skill

employment, visibility/prestige, corporate citizenship, stability,

spin-off potential, and more. Regrettably, Florida is currently

home to a disproportionately low share of the nation’s corporate

headquarters given its size.


North Central Regional Forum, Gainesville

Global Commerce Forum, Miami Gardens

Adjustments to Florida’s existing incentives are needed to

improve their competitiveness relative to other states—including

Tennessee, Georgia, Texas, and more—that have been especially

aggressive in this area.3

Reduce investment and job creation threshold for HIPI X

and the job creation threshold for CITC to encourage

corporate headquarters relocations. The prevalence of

existing, high-quality, low-cost office space makes the current

economic climate a good opportunity to recruit corporate

headquarters.

Increase the per job award for high impact sectors, X

including corporate headquarters under QTI. A higher

per job award places additional emphasis on the importance

of generating job creation in the sectors that provide the

greatest economic impacts.


Small business is the backbone of the Florida

economy—the state’s more than 426,000 small

businesses (with fewer than 500 employees)

represent 99% of all employers and 44% of private

sector employment. Florida is

also a highly entrepreneurial

state, generating significant

numbers of new business

births each year. Florida must

work to reduce small business

deaths by creating the

right environment for small

business development and

growth, and to retain its high

growth young businesses.

Roadmap forum participants

across the state called for a

greater focus on economic

gardening and small business development

assistance programs that provide services specific

to companies’ stages of development—including

market intelligence, technical assistance, and

leadership development—and outlined a range of

business climate issues hindering small business

growth and entrepreneurship.

expand Florida’s Financial Toolkit for small and medium BusinessesNew programs are needed to address a lack of available capital

hindering the day-to-day operation of Florida’s small and medium

sized businesses stemming from the global credit crunch, and that

has long challenged the state’s high growth, innovative, young

companies.

Establish a low interest loan fund. X Build upon the pilot

Economic Gardening Business Loan program by establishing

a low interest loan fund coordinated at the state level but

implemented though a bank consortium. A pool of loan

capital should be established from individual banks willing to

commit funds and share risk with the State. The monies would

be deployed in support of growth businesses and innovation

based companies with the full expectation of repayment.

Bank underwriting standards would be used, and the state

would help build reserves for losses and underwrite the cost

to maintain the lending consortium as a means of supporting

innovation-based business in Florida.

The Florida Office of Small Business Advocate and similarly

intended programs in other states provide a number of specific

terms and requirements for consideration.

Provide the Florida Development Finance Corporation X

with statewide authority. The Florida Development Finance

Corporation operates through inter-local agreements with

counties and cities. There is no statewide lending authority for

business and industrial finance, and borrowers must navigate

applications and procedures that are different in every locality.

Multi-jurisdictional bond issues have unnecessary complexity.

Providing the Florida Development Finance Corporation with

statewide authority will allow economic development projects

to have clear, timely responses on bond financing needs

regardless of where the project is located.4

Allow the transferability of tax credits for programs X

including the Capital Investment Tax Credit (CITC), and, if

enacted, the R&D tax credit. The transferability of tax credits

will provide essential, predictable cash flow to innovative small

businesses that do not have State corporate income tax liability,

while supporting job creation and capital investment. Tax credit

transferability is used to benefit innovation businesses in a

variety of competitor states.


Provide a Business Climate Conducive to Small Business Development and Entrepreneurship

ACTIOn ITEmS

Expand Florida’s financial toolkit for small and medium businesses

Expand technical assistance and business support services for small business and second stage growth companies

Address regulatory issues and policies that disproportionately impact small business

“Economic gardening programs succeed by creating an environment that nurtures entrepreneurs … The public sector plays a much more direct role in assisting local businesses in an economic gardening program than in a traditional economic development plan.”

—Federal reserve Bank of Atlanta, “Economic gardening Helps Communities grow their own jobs”



Northwest Forum, Pensacola

expand Technical Assistance and Business support services Available to small Businesses and second stage growth companiesTechnical assistance is at the core of economic gardening and

small business development. By providing critical resources

not otherwise available to or feasible for small firms—including

market intelligence, tax/legal counsel, business plan development,

strategic planning, technology training, grant assistance, financial

analysis, human resources development, and export training—

technical assistance helps small businesses identify and find

solutions to address obstacles to growth. For example:

Florida Small Business Development Center network y . Florida’s 35 Small Business Development Centers (SBDCs) provide one-on-one counseling to small business owners and entrepreneurs at no cost, covering topics such as business start up, advertising/sales, tax issues, and license regulations. SBDCs also offer training workshops, seminars, and conferences to cover beginner and advanced business management skills.

Economic Gardening Technical Assistance Pilot y – Economic gardening programs address the needs of second stage growth companies, providing resources and tools needed to create strategies to penetrate new markets, refine business models, and develop leadership teams. Florida recently launched a pilot state economic gardening technical assistance program via the Florida Economic Gardening Institute. The Institute will use a hub-and-spoke arrangement, with Orlando as the center and nodes across the state managed by partners, including local economic development organizations

workforce development agencies, and others.

Address Regulatory issues and policies That disproportionately impact small BusinessSpecial attention should be paid to regulations and policies that

unnecessarily burden and disproportionately impact Florida’s

small businesses. The Office of Small Business Advocate and

Small Business Regulatory Advisory Council were created in 2008

to advocate for small business in Florida and provide agencies

with recommendations on proposed and existing rules that

may adversely impact small businesses, respectively.5 In line

with this charge, the OSBA has conducted extensive outreach

to identify and provide input on a number of regulatory and

other business climate issues. The OSBA has offered a number of

recommendations to address small and medium sized business

concerns, including:

Reducing regulatory overlap y

State tax rebates on telecom and utility yexpenses as an incentive for expansion

Capping maximum annual real estate tax yincreases on commercial property occupied by SMEs

Procurement assistance programs for small ybusinesses across the state

Elimination of state contract “bundling” y


Recognizing that Florida competes against regional,

national, and global competitors and that delays

impact businesses’ bottom lines, Florida must

ensure that its regulatory systems are as efficient as

possible. Florida’s business community understands

the vital role that regulations, licensing, and

permitting processes can play in protecting public

safety and the environment—especially in a state

where natural amenities are so critical to supporting

economic activity.

Concerns arise over unnecessary duplication and

delays that significantly lengthen project timeliness

in Florida relative to other states. Regulatory

streamlining is needed at both the state and local

levels.


Improve State and Local Regulatory Environment

ACTIOn ITEmS

improve and streamline permitting processes

Amendment 4 concerns

Address industry-specific regulatory issues impacting targeted industries

improve and streamline permitting processes

Improve awareness of state expedited permitting program. X

Florida has an expedited permitting process in place that may

not be widely known. Expedited permitting under 403.973, F.S.

allows significant economic development projects and projects

located within designated Brownfield areas to obtain expedited

review of all needed state and regional permit applications,

and, at the option of participating local governments, local

development permits or orders and comprehensive plan

amendments.6

Encourage local governments to review permitting X

processes to find opportunities to speed review and align

policies with economic development priorities. Regulatory

and permitting delays are not confined to the state level. Local

processes can sometimes add redundant, time consuming,

and conflicting requirements that slow projects. To help

address the issue, some cities and local economic development

organizations provide staff to guide companies through local

regulatory processes.

Amendment 4 concernsThe need to defeat Amendment 4 (the “Vote on Everything”

amendment) came up at every Roadmap regional planning forum

held across the state. If passed by voters, Amendment 4 would

require that tens of thousands of local land use changes be decided

by referendum. Florida’s business community, led by the Florida

Chamber of Commerce, is calling for the defeat of this proposal—

which could significantly slow major economic development projects,

hinder communities’ ability to respond to job creating opportunities,

and permanently damage our state’s business climate.

Address industry-specific Regulatory issues impacting Targeted industriesIn addition to addressing broad regulatory processes that

unnecessarily burden companies regardless of industry, Florida

should develop a mechanism for identifying and addressing industry-

specific regulatory activities that detract from its competitiveness as a

location for major and targeted industries.



Tampa Bay Regional Forum, Tampa Bay

cASe IN PoINt: Florida Medical Device Facility Regulation

Florida boasts one of the nation’s largest medical device industries—composed of roughly 400 companies and more than 200,000 workers.

under federal law, establishments involved in the production and distribution of medical devices intended for market in the u.s. are required to register with FdA and submit to biennial inspection. Florida is currently one of only two states that requires an additional level of inspection by

state authorities. this requirement is not only duplicative, but sometimes conflicts with stringent national standards.

the Florida Medical Manufacturers’ Consortium and site selection consultants have indicated that this added layer of unnecessary regulation places the state’s medical manufacturers at a competitive disadvantage vis-à-vis other states.*

Footnotes for Business Climate for the Innovation Economy Section

1 Reference: U.S. Census Bureau Annual Survey of Manufacturers, and Florida TaxWatch http://www.floridataxwatch.org/resources/pdf/03172009EconomicImpactAnalysisFloridasManufacturingSector.pdf

2 Wu, Yonghong, The effects of state R&D tax credits in stimulating private R&D expenditure: a cross-state empirical analysis, Journal of Policy Analysis and Management, 24(4), 785-802, 2005; and Wu, Yonghong, State R&D tax credits and high-technology establishments, Economic Development Quarterly, 22(2), 136-48, 2008

3 For example, Tennessee offers refundable tax credits to offset qualified relocation expenses incurred in the establishment of a headquarters facility, addressing one of the most significant hurdles in recruiting a new company—the costs associated with relocating the business and certain employees to a new state. States such as Georgia and Texas not only aggressively market their incentives, but also have other attractive characteristics such as major international airports, strategic location making it easy to access to any point in the country, and an existing base of corporate headquarters.

4 Further, Bonds authorized by federal stimulus likely will have better utilization with a statewide bond issuing entity, and borrowers will not have financing delayed due to land use issues which are correctly handled through zoning and site plan reviews, not financing approvals. Providing statewide authority to Florida Development Finance Corporation does not curtail any bond issuance powers of local government and does better assure competitive pricing for bond issuance projects.

5 Florida Chapter 2008-149.

6 Details and eligibility requirements can be found in Enterprise Florida’s “Permit Streamlining Initiatives” Incentive Information Sheet.

7 The Florida Council of 100 and Florida Chamber of Commerce, Into the Storm: Framing Florida’s Looming Property Insurance Crisis, April 2009

8 Florida TaxWatch, Economic Impact Analysis of Florida’s Manufacturing Sector, March 2009

* For additional information, please refer to the Florida Medical Manufacturers’ Consortium white paper, “Florida Medical Device Facility Regulation”


Florida is no longer a low cost state. A high level of

amenities, quality of life, talent, and other factors

have drawn new businesses and residents to the

state for decades—resulting in higher costs of

living and doing business.

While rising costs are a tribute to Florida’s

successful development, they must be kept to a

minimum. Florida must ensure that its business

costs remain competitive and predictable.

Bottom line factors such as taxes, labor costs,

insurance costs, and site and housing affordability

impact businesses’ location and expansion

decisions, as well as the state’s continued ability to

attract and retain talent.


Provide Predictable, Competitive Business Costs

ACTIOn ITEmS

Address commercial and residential property insurance issues

support sales and use tax exemptions for Florida manufacturers

Address commercial and Residential property insurance issuesFlorida’s location, coastline, and warm weather mean it will always

face the threat of hurricanes. A healthy property insurance market

is therefore an important component of the state’s overall business

climate. Issues regarding the availability and cost of property

insurance, as well as the overexposure of the Florida Hurricane

Catastrophe (CAT) Fund, have remained leading business concerns

since the 2005 hurricane season and were mentioned at all Roadmap

regional planning forums. Businesses need predictable insurance

costs to allow for successful planning.

Adopt an approach to property insurance reform based X

on the following 4 principles: (1) risk determined rates,

(2) competitive markets, (3) increased mitigation, and (4)

exploring appropriate federal involvement.7 This approach

has been advocated by the Florida Chamber of Commerce

and Florida Council of 100—two of the state’s leading

business organizations.

support sales and Use Tax exemptions for Florida manufacturers The maintenance of Florida’s fifteen existing sales and use tax

exemptions for manufacturing inputs is crucial to the long-term

growth and competitiveness of manufacturers across all industry

clusters. According to a recent Florida TaxWatch study, “ … if the

identified manufacturing tax incentives are eliminated, it would result

in a net loss (after controlling for changes in government spending) of

more than 3,300 Florida jobs, $980 million in GSP, $2.3 billion in state

output, and $200 million in exported goods by 2018.”8 In addition,

according to the Manufacturers Association Florida, Florida is already

noncompetitive with sister states on tax policy for manufacturers

and the elimination of these exemptions would further tilt the tables

against us. In fact, the Manufacturers Association of Florida has

advocated for the expansion of sales and use tax exemptions for

manufacturing inputs.

(Please note that water and energy needs are discussed in the Growth

Leadership section of this plan.)


Documents

BusinessClimate