Alan Horne was worried last year about finding a job in manufacturing when he moved back to Orlando where he had gone to high school. He’d spent 20 years working as an engineer in Japan, Georgia and other places.
“I knew it was a bit of a gamble — that the area is known more for tourism than manufacturing,” Horne said. But he quickly landed a job at a company that had just been approved to receive state incentive dollars to expand in Orlando: Voxx International. Horne is now a project engineer there, making automobile entertainment systems.
The incentive program that Voxx used is facing elimination under a bill filed in the Legislature this week, backed by House Speaker Richard Corcoran.
Local leaders say cutting incentives could spell trouble for Orlando’s efforts to add more higher-paying tech, health and professional jobs — as it did in recent years with incentives for Voxx, Deloitte, Verizon and KPMG — to balance tens of thousands of low-paying hospitality and theme-park jobs.
There are many ways to entice a business to locate in your community, said Crystal Sircy, executive vice president at the Orlando Economic Development Commission. The most important issue is ability to hire a trained workforce. But Sircy said competition is fierce, and sometimes cities wind up being equal at the end of a company’s research. If Orlando has no money to offer, while Dallas or Atlanta does, the company probably won’t come to Central Florida, she said.
“To lose the ability to win the competitive advantage, at the end of that competition, would be unfortunate,” she said.
Some local companies have grown without incentive money, like Zellwood-based Anuvia, which makes fertilizer from treated sewage wastewater and food waste. The company now has about 50 employees, CEO Amy Yoder said.
“There’s nothing objectionable about incentives, but we have been funded by bonds and private equity,” Yoder said. “I believe in private money more because it usually rewards quicker and produces better results.”
She said Anuvia chose Florida as a location because it demonstrated a business-friendly outlook — including its incentive programs, which the company could still use in the future.
Enterprise Florida, as well as Visit Florida and Space Florida, have historically coordinated state incentives. Local governments also coordinate incentive deals with the state and often pitch in.
Every state offers some kind of incentives, and half of them offer cash incentives, said Jay Biggins, a New York- based consultant with one of the nation’s leading site selection companies.
“Public-sector economic-development incentives are built as a pricing strategy,” he said. “Like any other part of your business, relocating has a cost, and helping companies with that cost makes you more attractive.”
Other states continue to offer aggressive cash incentives. Industry observers said lawmakers in other states, such as North Carolina, have tried to end or cut back some of their incentive programs, only to refund them. In 2015 North Carolina replenished funding for its Jobs Development Investment Grant program through 2018, and raised the monetary value of JDIG grants the state can give each year from $15 million to $20 million for most projects.
Bloomberg produced a survey that year that named Texas, Florida and Nevada as the most business-friendly states for relocations, in terms of corporate taxes and incentives. New York, California and Illinois were deemed the least friendly, although those states do offer incentives also.
Scott’s request this year for $85 million to fund Enterprise Florida is about one-third of his request last year for $250 million, when the legislature approved no money for it. Corcoran, R-Land O’Lakes, has called such programs “corporate welfare” and is leading the effort to kill incentive funding.
Concerns about waste dominated discussions last year regarding Visit Florida, especially when rapper Pitbull revealed he was paid $1 million to make a tourism-oriented song and video. Another black eye for state and local incentives developed after Sanford Burnham Prebys institute in Lake Nona said it was pulling out of Florida. The research facility had received $155 million in state incentives during a 10-year period — and more from local and federal funds — for a total of about $350 million.
But Sanford Burnham wasn’t required to produce the jobs before receiving the funds. That is a requirement under the state’s Qualified Target Industry fund, which focuses on awarding incentives to companies that pay higher-than-average wages.
Some believe any attempt to offer benefits directly to a company amounts to corporate welfare or, as Sarah Palin has said, “crony capitalism.” The nonprofit group Americans for Prosperity believes that economic-development agencies should be limited to providing information about a region only, said Chris Hudson, state director for AFP in Florida.
“There’s a lot of things that companies can’t glean from an internet search. They need information about eminent domain, tax policies, plans for future infrastructure,” Hudson said. “That conversation is respectable.”
He said he realizes Florida may lose some projects without cash incentives, and he’s OK with that.
The Space Coast also has been relying heavily on incentives to attract companies such as Blue Origin, which has already been approved for a reported $26 million incentive package to build a new rocket factory and employ 300 people at an average of $89,000 salary, and OneWeb, which is in line for about $20 million in various incentives to build a satellite plant employing 250 people.
In Orlando, Voxx executives said an incentive package of $1.4 million from Florida and the city was among the reasons they chose to move their headquarters here from New York.
Voxx has about 200 employees near Lake Nona, Horne said. That meets the required number of new jobs under its incentive agreement, which was 134.
Horne is glad he found the right fit for his skills without commuting across the state or needing to fly often.
“I was prepared to travel a lot for work when I moved here,” he said.
Got a news tip? pbrinkmann@orlandosentinel.com or 407-420-5660; Twitter, @PaulBrinkmann
Univision, the nation’s largest Spanish-language media company, filed a lawsuit against Charter in July 2016.
Univision, the nation’s largest Spanish-language media company, filed a lawsuit against Charter in July 2016.
Univision, the nation’s largest Spanish-language media company, filed a lawsuit against Charter in July 2016.
Univision, the nation’s largest Spanish-language media company, filed a lawsuit against Charter in July 2016.
Orlando-area McDonald’s are undergoing an aggressive revamp to modernize the region’s 195 fast-food restaurants.
Orlando-area McDonald’s are undergoing an aggressive revamp to modernize the region’s 195 fast-food restaurants.
Although Central Florida’s Arab population is small, some restaurants are striking out against Trump Administration policies on immigration, saying it could hurt the restaurant industry. Cress Restaurant in Deland has even registered to be a “Sanctuary Restaurant,” a fancy term saying that it supports people of all backgrounds.
Although Central Florida’s Arab population is small, some restaurants are striking out against Trump Administration policies on immigration, saying it could hurt the restaurant industry. Cress Restaurant in Deland has even registered to be a “Sanctuary Restaurant,” a fancy term saying that it supports people of all backgrounds.
The announcement sent Ralph Lauren’s shares down as much as 11% on Feb. 2. (Feb. 2, 2017)
The announcement sent Ralph Lauren’s shares down as much as 11% on Feb. 2. (Feb. 2, 2017)
Food giant Nestle USA is moving its headquarters from Glendale, Calif., to Rosslyn, Va.
Food giant Nestle USA is moving its headquarters from Glendale, Calif., to Rosslyn, Va.
Our editors found this article on this site using Google and regenerated it for our readers.
