1 / 30

Incentives 101

Incentives 101. June 29, 2012. Incentives 101. Overview of Florida’s incentive process Basic program information Compliance process Sales tax exemptions and other credits Incentives for target areas New legislation FY 2012/13 incentives budget. It’s Game Time!.

obelia
Télécharger la présentation

Incentives 101

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Incentives 101 June 29, 2012

  2. Incentives 101 • Overview of Florida’s incentive process • Basic program information • Compliance process • Sales tax exemptions and other credits • Incentives for target areas • New legislation • FY 2012/13 incentives budget

  3. It’s Game Time! • Come up with a hypothetical project • Describe and “sell” your project to the group in 30 seconds or less • Decide which project is most worthy of your community’s coveted • Rules: • You cannot vote for your own • You may only vote once

  4. Competitiveness • What are the key decision drivers? • The business decision must make sense for the company and taxpayers • We must help build a compelling case for Florida • State to state comparison • Florida’s competitiveness study • Rankings and reports

  5. Role of Incentives in the Economic Development Process • Understanding the project’s needs is critical to developing a compelling incentive package • Instead of: • What do I have to offer this company? • Think of: • What are the critical decision factors and how can we address them?

  6. Enterprise Florida and the Department of Economic Opportunity • Enterprise Florida • Assess project needs • Conduct competitive analysis • Negotiate incentives • Department of Economic Opportunity (DEO), Division of Strategic Business Development • Application review and approval (account executives) • Ensure statutory compliance • Contract with businesses • Manage compliance

  7. Types of Tax Incentives • Credit – lowers amount of taxes due by the value of the credits • Different than a deduction, which can be treated like an expense incurred to generate income • Refund / Rebate – pay the taxes, get a check back • Exemption – do not have to pay the taxes • Abatement – do not have to pay the taxes

  8. What is a Target Industry? • Statutory criteria: • Future growth • Stability • High wage • Market and resource independent (exception for clean energy projects) • Industrial base diversification and strengthening • Economic benefits with added emphasis on global trade and logistics • Cannot be companies with NAICS codes 5611 or 5641 except under certain circumstances • List updated every three years

  9. Qualified Target Industry (QTI) Tax Refund • Tax refund based on net new to Florida jobs • Average wage at least 115% of state or local wage ($46,638 minimum for Florida) • Requires 20% match from local community • Must be a clear inducement • Special considerations for Enterprise Zones, Brownfield areas, and Manufacturing companies paying 100% of the average wage • Performance based • Lifetime cap of $7 million per company

  10. QTI Refund Amounts • QTI award is based on the number of net new to Florida jobs created, the average wage and location of the jobs, and other factors • Base award is $3,000 per job ($6,000 per job in a Rural county or Enterprise Zone) • $2,500 per job if project is located in a designated Brownfield area (Brownfield Bonus) • 150% of wage add $1,000 per job OR 200% of average wage add $2,000 per job • $1,000/job if local financial support is equal to the base QTI award • $2,000/job if project is in a designated high impact sector OR • $2,000/job for businesses increasing tonnage or volume through Florida’s ports or airports by at least 10% per year

  11. QTI Claim Process Example Business commits to create 50 new jobs by December 31, 2013:

  12. Qualified Defense and Space Contractor (QDSC) Tax Refund • Similar to QTI Program including lifetime cap limit except • Program allows company to count retained jobs • Designed for Department of Defense, Department of Homeland Security, and Space Flight Business contractors • Available for job creation and retention for businesses: • Securing new contracts • Consolidating existing contracts • Converting defense technology to commercial production • Reuse of a defense related facility • All jobs must be tied to specific contracts

  13. Economic Development Transportation Fund (EDTF) or Road Fund • Grant to local government to alleviate a transportation impediment • Must be an inducement for retention, expansion, or location • Program administration transferred to DOT • Eligibility requirements similar to QTI • Project examples: • Turn lanes • Access roads • Traffic signals

  14. Current High Impact Sectors • Clean Energy • Corporate Headquarters • Financial Services • Life Sciences • Information Technology • Semiconductors • Transportation Equipment Manufacturing Updates Forthcoming

  15. High Impact Performance Incentive (HIPI) • Negotiable cash grant paid to business • Eligible projects operate in designated portions of high-impact sectors • Creation of at least 50 new jobs (25 for R&D) and $50M capital investment ($25M for R&D) • Paid in two installments, based on “commencement of operations” and “commencement of full operations”

  16. Capital Investment Tax Credit (CITC) • Tax credit for designated portions of high-impact sectors • Creation of at least 100 new jobs and $25M capital investment • Total amount of credit varies depending on capital investment threshold • Credit taken at 5% per year for 20 years • Business investing at least $100M with unused tax credits due to insufficient tax liability may have an additional 10 years to claim the credits

  17. Governor’s Quick Action Closing Fund • Deal closing tool used at the Governor’s discretion • Addresses a competitive gap vis-à-vis other states • Approval process: • Awards under $2M can be approved by the Governor • Awards between $2-$5 million require notification of House and Senate leadership • Awards of more than $5 million must be approved by the Legislative Budget Commission

  18. Innovation Incentive Program • Attracts major research initiatives, innovation business projects, or clean energy projects • Cash grant to business, repaid via a reinvestment requirement • Requires 1 : 1 match from community • Wages must be 130% of prevailing average or equal to industry average, whichever is higher • Approved by the Governor and Legislative Budget Commission

  19. Sales Tax Exemptions • R&D equipment (predominant use) • Semiconductor, defense, and space technology production equipment • Manufacturing machinery and equipment (MME) and subsequent labor, parts, and materials used to repair equipment • Refund of up to $50,000 available for equipment purchased in FY 2010-11 or FY 2011-12 • Electricity used in the manufacturing process • Certain aircraft and spacecraft expenditures • Manufacturing & fabricating aircraft and gas turbine engines • Film, television, and other production activities

  20. Other Tax Credits • Research and Development • Incremental increase in R&D expenditures • Spaceflight Projects • 50% credit for space businesses creating jobs making capital investments • Film Production • Percentage of Florida production related expenditures

  21. Brownfield Redevelopment Bonus • Up to $2,500 in tax refunds per new Florida job created • Two ways to qualify: • Be a qualified target industry business under the QTI Program OR • “Stand-alone Brownfield” - demonstrate a fixed capital investment of at least $500,000 in mixed-use business activities ($2 million if the site requires remediation) and create at least 10 new jobs with benefits • Other Brownfield incentives: • Voluntary clean-up tax credit • Loan guarantee program

  22. Enterprise Zone Incentives • Enterprise Zone Jobs Tax Credit • Credit based on wages paid to employees that are EZ residents • Sales Tax Refund for Building Materials • Refund of sales tax paid on building materials, up to $5,000 or $10,000 • Sales Tax Refund for Business Machinery and Equipment • Refund for sales tax paid on the purchase of certain business property, up to $5,000 or $10,000 • Property Tax Credit • Credit equal to 96% of ad valorem taxes paid on new or improved property, up to $50,000 annually for up to five years

  23. Rural and Urban Incentives • Rural Job Tax Credit • $1,000 per job created within specific industries in a rural county • Rural Infrastructure Fund • Grant for assistance with infrastructure development and feasibility studies • Rural Community Development Revolving Loan Program • Loan to local government for a specific economic development related project • Urban Job Tax Credit • $500 to $1,500 per job created within specific industries in a designated Urban area

  24. Workforce Florida Incentives Quick Response Training (QRT) • Grant for customized training needs • Reimbursable training expenses include: • instructors'/trainers' wages; • curriculum development; and • textbooks/manuals. Incumbent Worker Training (IWT) • Skills upgrade training assistance for existing employees • Maximum of $50,000 per business per year

  25. 2012 Legislative Changes • SEED Fund (State Economic Enhancement and Development) • Manufacturing (MME) sales tax exemption • Output requirement lowered to 5% • Manufacturing & Fabricating Aircraft and Gas Turbine Engines • Confidentiality statute 288.075

  26. Incentive Appropriations

  27. Crystal Sircy, Senior Vice President of Business Retention and Recruitment 850.298.6628 • csircy@eflorida.com Rob Sitterley, Vice President of Business Development, Financial/Professional Services • 407.956.5653 • rsitterley@eflorida.com Casey Barnes, Director of Business Development, Defense, Aerospace and Aviation • 407.956.5609 • cbarnes@eflorida.com Joel Gunter, Director of Business Development Biofuels and Manufacturing • 407.956.5621 • jgunter@eflorida.com

  28. Tim Johns, Business Development Manager CleanTech and Manufacturing • 407.956.5611 • tjohns@eflorida.com Matt Lowell, Business Development Manager Life Sciences • 407.956.5659 • mlowell@eflorida.com Brandon Carson, Business Development Manager Information Technology 850.298.6622• bcarson@eflorida.com Sean Malott, Business Development Manager Logistics and Distribution • 407.956.5668 • smalott@eflorida.com Luis Perez-Codina, Business Development Manager General Business 850.298.6638• lperez-codina@eflorida.com

  29. Marty Wilson, Vice President, Competitiveness Programs & Policies 407.956.5633 • mwilson@eflorida.com Joseph Bell, Program Manager 407.956.5622 • jbell@eflorida.com Heather Squires, Incentives Manager 407.956.5696 • hsquires@eflorida.com Adam Henry, Business Development Coordinator 850.298.6624 • ahenry@eflorida.com

More Related