By Nathan Sparks, CEcD
One Okaloosa EDC
The legislative season is upon us once again, and as lawmakers work to balance a wide range of competing priorities in Tallahassee, some encouraging signs are beginning to emerge regarding new life for Florida’s Qualified Target Industry (QTI) tax refund program. In a nutshell, QTI is a performance-based incentive program that incentivizes the creation of high quality, high wage jobs in highly valued targeted industries by both new and existing Florida employers. Along with hiring a minimum number of new employees and operating within one of Florida’s targeted industry sectors, companies must pay at least 115% of a particular county’s average wage in order to receive a refund of certain taxes paid. In addition, and this is very important, refunds are only paid when company performance is verified through a rigorous demanding compliance process.
The QTI program has been the cornerstone of Florida’s economic development “tool kit” for 25 years – that is, until June 30, 2020 when the program was unceremoniously allowed to sunset. Since that time, other states have been using the expiration of Florida’s QTI program as a tool to dissuade businesses from locating or expanding in our state. The argument goes something like, “Do you really want to locate in a state that is systematically eliminating programs that provide value to businesses bringing forth new, high wage jobs? Why not instead locate in (insert state name here) where we actually value your contributions and remain firmly committed to the sustainment of programs that assist in your growth?” If that wasn’t bad enough, recent discussions with site selectors (hired consultants who advise businesses on future business locations) have even revealed that some of them view Florida’s failure to renew our tried and true QTI program as an official exodus from competitive business recruitment endeavors.
Of course, the world has changed markedly since the gavel fell on the 2020 Florida Legislative Session on March 13 of last year, with no action taken to renew the state’s QTI program. With such a large percentage of Florida’s economy directly tied to hospitality/tourism, our state’s economy took a literal kick to the gut as a result of COVID-19 and sales tax collections plummeted. Now, with the state legislature back in session, it appears that the presently mothballed QTI program may be reinstated after all. Two bills have been introduced that would serve to accomplish this by effectively removing the June 30, 2020 sunset date – Senate Bill 982 and House Bill 6071. As of the date of this writing, SB 982 has successfully passed two committees with NO dissenting votes. The bill is now waiting its turn in Senate Appropriations, and we encourage favorable consideration in order to ensure Florida’s future competitiveness.