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Senate Jobs Bill Seeks Accountability for Tax Incentives

The sponsor of the Senate’s wide-ranging jobs bill said Thursday the package is aimed at forcing businesses to prove they are expanding employment when taking advantage of state tax breaks and other incentives.

Sen. Don Gaetz, R-Niceville, said a price-tag has not yet been put on the package of tax exemptions, credits and grants aimed at manufacturers, researchers and industries --including space, film and aircraft and boat sales.

But he acknowledged the effort’s cost will prove “significant,” with well into hundreds of millions of tax dollars likely needed for the effort.

“The answer is not to spend more money on unemployment, but to spend money on employment,” Gaetz told the News Service of Florida.“But there has to be a nexus –  a hardwire – between anything we do and making it easier for people to get and keep jobs.”

Efforts to revive Florida’s feeble economy are shaping up as a tug-of-war between Republican lawmakers eager to give businesses some long sought-after tax breaks and Democrats who fear the state’s 1.1 million unemployed are being left behind.

The starkest fight centers on the business community’s demand that a scheduled increase in the state’s unemployment compensation tax be postponed. While lawmakers from both parties support the delay, many House and Senate Democrats want more jobless Floridians to be ruled eligible for benefits – a move that would draw an additional $444.3 million in federal stimulus.
   
Gaetz, chairman of the Senate Select Committee on Florida’s Economy, appears to be trying to bridge the divide.

“You want to hold businesses accountable,” Gaetz said. “In return for any kind of incentives, we want to hold businesses responsible for creating jobs that meet very specific criteria.”

Gov. Charlie Crist has recommended $293.7 million in business tax breaks and assistance. But none of the governor’s proposals are reflected in what the Senate has in mind.

Instead, the Senate includes a revamped version of the current sales tax exemption for machinery and equipment, requiring that businesses show a 10 percent increase in production to qualify, likely adding jobs. A corporate investment tax credit also would be created for capital investment producing jobs whose annual salary is 130 percent of the area average.

Another piece of the Senate proposal gives companies a $1,000-per-job corpoprate income tax credit for businesses that hire someone unemployed for at least 26 weeks.

The legislation also includes some approaches likely to draw fire from environmental groups.

Among them are a relaxing of Department of Environmental Protection oversight of permitting in small counties and cities and a three-year renewal of last year’s controversial lifting of transportation standards for new development.

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