Transcript Slide 1

Pinellas County Economic Development
Florida History
 1980 Constitutional amendment authorized tax exemption to
encourage economic development after an approving
referendum
 2011 Amendment expanded eligible business categories,
added criteria for applications, authorized contracts and
revocation of exemptions for failure to meet representations
 At least 38 counties, including Hillsborough and Sarasota, and
23 cities including Tampa, St. Petersburg, Clearwater and
Largo already offer an ad valorem tax exemption.
What is it?
 An abatement of the County portion of the property tax
 Any existing property taxes are not considered
 The abatement is only on new ad valorem and tangible
property taxes that would result from increases in value based
on new and expanding business investments
 Up to 100% assessed value of improvements to real property
made by new or expanding business
 Up to 100% assessed value of net increase of tangible
personal property (equipment)
 Duration up to 10 years – No renewal allowed
Who is Eligible?
New Business/Organization
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Creates 10 or more new full-time jobs with higher wages
than area average, and which:
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Manufactures, processes, compounds, fabricates or produces for sale items of
tangible personal property at a fixed location; OR
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Is a target industry business as defined in Florida Statutes
Creates 25 or more new full-time jobs with more than
50% sales outside of Florida
Creates 50 or more new full-time office jobs, newly
domiciled, on site separate from other operations of the
organization
Who is Eligible?
Existing Business/Organization
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Creates 10 or more new full-time jobs with higher wages
than area average, and which:
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Manufactures, processes, compounds, fabricates or produces for
sale items of tangible personal property at a fixed location; OR
Is a target industry business as defined in Florida Statutes
Creates 25 or more new full-time jobs with more than
50% sales outside of Florida, and increases employment
or production by 10%.
Who is Eligible?
Examples of Target Industry Businesses
 CleanTech
 Life Sciences
 Information Technology
 Aviation/Aerospace
 Homeland Security/Defense
 Financial/Professional Services
 Emerging Technologies
What happens if the referendum is approved?
 The County Commission would adopt an ordinance
establishing the Program, including the requirements and
application packet. A public hearing is required.
 The County Commission would approve an application through
the adoption of a separate ordinance for each exemption
granted. A public hearing is required for exemption granted.
 The County Commission will know the name of the company
prior to the approval vote.
What happens if the referendum is approved?
 The County Commission and the company enter into a written
agreement, including performance criteria.
 The agreement will require an annual status report on actual
job creation and actual wages.
 The County Commission may revoke, in whole or in part, the
exemption if the company fails to meet expectations made in
the agreement.
What is required in the application?
 Name and location of new or expanding business
 Description and date of improvements
 Description and date of purchase for tangible personal
property
 Proof of status as “new or expanding” business
 Number of full- and part-time jobs and the average wages of
these positions
 The expected time schedule for job creation
 Other information deemed necessary by Pinellas County
What are the Evaluation Criteria?
 Net number of new jobs
 Average wage of new jobs
 Capital investment to be made by applicant
 Type of business
 Environmental impact
 Extent applicant intends to source supplies & materials within
Pinellas County
 Economic related characteristics deemed necessary by county
Can you give an example?
Business A is an existing medical device manufacturer that would like to expand in Palm
Harbor. The company currently has 50 employees in a 25,000-square-foot building. The
company would construct a new 10,000-square-foot manufacturing building and purchase
$200,000 in new equipment. The company would create 20 new full-time jobs at an
average annual wage of $48,000.
 The Property Appraiser has valued the new building and equipment at $600,000.
 The company would be eligible for an annual tax exemption of approximately $4,450 for
the new building and equipment.
 The company would still pay school, library, EMS and other ad valorem taxes on the new
building and equipment of approximately $6,460 annually.
 The company would also continue paying all property taxes on its existing 25,000-squarefoot building. Based on a value of $1,250,000, these taxes would be about $22,740
annually.
Can you give an example?
Below is a chart showing the amount of county tax exemptions that could exempted based on
three different tax value increases. If a company locates in unincorporated Pinellas County, it
would be eligible for both county and MSTU tax exemptions. If a company locates in a
municipality there is no MSTU tax, so it would be eligible for only the county tax exemption.
Examples of Ad Valorem Tax Exemption
2013 County Millage Rate
5.3377
2013 MSTU Millage Rate
2.0857
Sample Scenario
Tax Value Increase
Business A
Business B
Business C
100,000.00
1,000,000.00
10,000,000.00
Maximum Annual County Tax Exemption
533.77
5,337.70
53,377.00
Maximum Annual MSTU Tax Exemption
208.57
2,085.70
20,857.00
TOTAL Maximum Annual Tax Exemption
742.34
7,423.40
74,234.00
7,423.40
74,234.00
742,340.00
Maximum Tax Exemption 10 years
Why does Pinellas need this?
 Counties and cities throughout Florida offer this program and
we are at a competitive disadvantage.
 As a nearly built-out county, the cost to develop and
redevelop is much more expensive than in greenfields.
 The program focuses on reducing the cost and thereby
encouraging new high-quality development.
 The program focuses on high wage jobs.
 The program is designed to attract investment that would not
occur without the incentive.
 The money does not come out of current county reserves,
leaving these funds for critical county needs.
Which
communities
use this incentive?
What is the Ballot Language?
ECONOMIC DEVELOPMENT PROPERTY TAX EXEMPTIONS FOR NEW
BUSINESSES AND EXPANSIONS OF EXISTING BUSINESSES
Shall the Board of County Commissioners of Pinellas County be authorized
to grant, pursuant to Section 3, Article VII of the Florida Constitution,
property tax exemptions to new businesses and expansions of existing
businesses that are expected to create new, full-time jobs in the County?
_______ Yes – For authority to grant exemptions
_______ No – Against authority to grant exemptions
Who can I contact for more information?
Pinellas County Economic Development
Please visit www.PCED.org/Jobs to learn more, or call us
at (727) 464-7425. We’d be happy to discuss this issue
with you and answer your questions.