Governor Crist Plans Bold Job-Growth Strategies with
More Than $100 Million in Tax Relief
~Announces assistance to small businesses and individuals adapting to Florida’s changing economy ~
PANAMA CITY – Governor Charlie Crist today proposed strategies for growing jobs, businesses and economic opportunities through $100 million in tax relief to families and businesses. Governor Crist recommended a $9.7-billion investment in economic development, which includes infrastructure, workforce development and incentives for small businesses. Governor Crist also highlighted his recommendations for continued investments to assist individuals, businesses and communities as Florida’s economy recovers.
“Indicators show that Florida’s economy is steadily recovering every day, yet we must work to ensure our progress continues,” Governor Crist said. “The budget I am recommending will grow Florida’s strongest economic sectors while also spurring new high-wage, high-tech business opportunities.”
Governor Crist visited Berg Steel Pipe Corporation (BSPC) in Panama City to make today’s announcement. BSPC employs 320 full-time workers and more than 40 temporary employees. Later today, he will visit the Sallie Mae Loan Servicing Center in Lynn Haven. Sallie Mae provides federal and private student loans for undergraduate and graduate students and their parents. In addition, Sallie Mae offers comprehensive information and resources to assist students, parents, and guidance professionals with the financial aid process. Joining Governor Crist for today’s announcement were Representative Jimmy Patronis; Dave Delie, president and CEO or Berg Steel Pipe Corporation; and business leaders from Northwest Florida.
Tax Relief
Governor Crist reiterated his conviction that tax cuts are a proven method for economic recovery during challenging economic times. To that end, the Governor’s recommended budget includes more than $100 million in tax relief.
· Corporate Income Tax Rate Cut – Governor Crist proposed a one-percent reduction in the corporate income tax rate, from 5.5 to 4.5 percent, on the first $1 million of a corporation’s taxable income. This tax cut will provide relief to businesses by allowing them to keep more of their hard-earned income. It will also strengthen Florida’s business friendly climate and competitiveness, which will attract new business investments and provide additional jobs for Floridians. The tax cut will save businesses approximately $57.4 million.
· Back-to-School Sales Tax Holiday – Governor Crist’s budget recommendations include a 10-day Back to School Sales Tax Holiday, anticipated to save Florida families $52.1million in sales taxes. Florida families will save money when buying clothing selling for less than $100 and school supplies selling for less than $10. The Back-to-School Tax Holiday has proven to stimulate business activity while helping Florida families save on clothes and school supplies.
· Delay Unemployment Compensation Tax Payment – Changes going into effect January 1, 2010, resulted in potentially burdensome increases in unemployment taxes for Florida businesses when the minimum rate increased from $8.40 to more than $100 for each employee. Governor Crist emphasized his commitment to working with the Florida Legislature to pass legislation early in the upcoming session to delay this increase and provide relief to Florida businesses.
Strengthening Small Businesses
Governor Crist recommended several initiatives designed to assist small businesses and stimulate job creation:
· Localized Economic Gardening – From 2005 to 2007, companies with 10 to 50 employees represented just over eight percent of Florida resident companies, yet generated 36 percent of the jobs created by companies headquartered in the state. Recognizing the tremendous job-creation ability of this economic sector, Governor Crist encouraged the Florida Legislature to create the Economic Gardening Technical Assistance Pilot Program implemented in Fiscal Year 2008-09. The program identified qualified companies and provided specific services, such as market information, leadership development and assistance in digital media applications, helping them to expand their economic opportunities. The Florida Economic Gardening Institute at the University of Central Florida (UCF) was created as a result of the pilot program.
A localized approach to Economic Gardening builds on the pilot program’s foundation. The Governor recommended $3 million to help local communities create their own Economic Gardening programs tailored to regional needs.
· Assistance to Small and Start-Up Businesses – Roughly 94 percent of Florida businesses have fewer than 10 employees and may not have access to critical resources to further their success. Governor Crist recommended $3.8 million to provide technical assistance to these businesses through the Florida Small Business Development Center Network (SBDC). The principal business assistance organization for small businesses in the state, the SBDC is a statewide economic development partnership between higher education and other stakeholder organizations. The statewide network includes 35 centers representing universities, community and state colleges, chambers of commerce, local governments, economic development organizations and other enterprises. Funds would provide grants of up to $750,000 to existing small-business development organizations to provide technical assistance that will help them expand and create jobs.
Sustaining Economic Activity
· Florida’s Defense Industry – Florida’s defense industry remains a growing economic sector with an annual economic impact of more than $52 billion, supporting more than 723,000 jobs and generating $1 billion in local and state tax revenue. To preserve this vital Florida industry and continue Florida’s commitment to servicemembers, Governor Crist recommended $10.5 million for Defense Infrastructure Grants to address the infrastructure needs of communities surrounding Florida’s military installations. This investment is vital to keeping Florida’s bases open and preventing missions from moving out of state.
· Rural Communities – To help Florida’s rural communities fund capital investments and diversify their economies, Governor Crist recommended investing $10 million to facilitate planning, preparation, and financing of infrastructure projects. This funding will help rural communities benefit from job creation, capital investment, and better equip them to access federal programs.
· Housing – Governor Crist recommended tripling last year’s funds for producing, maintaining and restoring affordable housing. The proposed $93.4 million will leverage federal funds and tax credits to provide affordable rental units and assistance for qualifying first-time home buyers with down payments and closing costs.
· Transportation – For every billion dollars invested in building and maintaining roads and bridges, 28,000 jobs are created or retained. Governor Crist recommended $5.8 billion for the Transportation Work Program, impacting 156,800 jobs across the state. The Governor reiterated his commitment to the safety of current and future generations of Floridians by maintaining existing roads and bridges, while also focusing on reducing congestion through high-value transportation projects. With the funding provided, 132 new lane miles will provide congestion relief, approximately 2,000 lane miles will be maintained to protect the state infrastructure, and 10 bridges will be replaced, assuring safe passage for motorists. Two key projects in Governor Crist’s recommendations are:
o Interstate-95 Expansion – The project expands the interstate from South of State Road 528 to North of State Road 50 in Brevard County. The expansion is critical to improving congestion on this north-south connector.
o Interstate 75 Expansion and Rehabilitation – The project expands and rehabilitates the interstate from South of State Road 582 (Fowler Avenue) to State Road 56 in Hillsborough County. The additional road capacity will better serve commuters in the Tampa Bay region.
Governor Crist recently signed historic legislation modernizing Florida’s transportation system by creating a comprehensive framework for the growth and development of passenger rail within our state. The legislation enhances Florida’s effort to successfully compete for federal high speed rail funds and advance Florida’s efforts to build a 21st century transportation system. The bill also authorized the purchase of the Central Florida Rail Corridor and provided funds to continue the operation of the South Florida Tri-Rail commuter system. In addition, Governor Crist’s budget proposal includes $1.1 billion to support intercity high speed rail linking Tampa to Orlando; planning of the Orlando to Miami high speed rail segment; and SunRail, which will relieve congestion along Interstate-4 in Central Florida.
Workforce Development
Governor Crist recently called on the Florida Legislature to support a collaborative effort designed to enhance Florida’s Talent Supply Chain and provide the education and job-readiness skills needed to support a 21st century knowledge-based innovation economy. The partners – which include the Agency for Workforce Innovation, Workforce Florida Inc., the Florida Department of Education, the Board of Governors of the State University System and Florida businesses – will work to link-up educational institutions with providers, policy makers, and the general public so that investments in these areas seamlessly develops Florida’s talent pool.
Governor Crist’s proposed budget includes initiatives to create a pathway toward increased productivity, career advancement and economic prosperity:
· Affordable Childcare for Working Parents – Governor Crist recommended $615.4 million for the affordable childcare service that allow the caregivers of approximately 200,000 Florida children to fully participate in Florida’s changing economy.
· Career Education for Adults and Young Adults – Career education provides Floridians with the tools for successful adaptation in a changing economy. Governor Crist recommends:
o $3.3 million for Quick-Response Training,– provides specialized training to new and current employees to meet the changing skill requirements caused by new technologies and product lines.
o $263.3 million for Employment and Career Education Services, delivered by the regional workforce boards to prepare Florida’s families for the high-wage, high-skill jobs of Florida’s changing economy.
o $3.4 million for training for at-risk youth, to help overcome barriers to employment and facilitate successful participation in the workforce.
· Florida Back to Work – Governor Crist also recommended the allocation of $20 million in federal funding in the current fiscal year to assist Florida businesses with hiring individuals who are eligible for Temporary Assistance to Needy Families. Announced last month, the Florida Back to Work Program subsidizes the wages of eligible employees through September 30, 2010. These time-limited federal funds will provide Florida businesses with employees to grow their business while providing low-income individuals with valuable work experience. To date, over 900 businesses have responded, which will result in the creation of over 10,000 jobs. It is anticipated that the full $200 million available to the state will be used in this program.
· Unemployment Compensation – During 2009, Florida paid $3.08 billion in state unemployment benefits and $3.4 billion in federally funded extended benefits to 1.1 million unemployed Floridians. These benefits have resulted in a cumulative economic benefit of $10.7 billion to Florida’s economy. To sustain Floridians while they seek employment and to continue the benefits payments that stabilize our economy, Governor Crist’s Fiscal Year 2010-11 budget recommends:
o $62.7 million to enhance the processing and distribution of unemployment compensation benefits.
o $18 million for administering the unemployment compensation program.
o $27.6 million for technology improvements, which include the replacement of the 37-year-old computer operating system.