Escambia County News Pensacola Politics

Oliver Goes On EDATE With Women

January 17, 2012

The salad was light and the tea was sweet, but conversation waded immediately into deeper waters: politics. That’s the way the League of Women Voters prefer it.

Today, the League enjoyed lunch at Dharma Blue and discussed the merits of EDATE, a tax-incentive issue appearing locally on the Jan. 31 ballot. Members had a general grasp on the subject, but wanted to nail it down.

“So, we decided we’d get the straight story,” said local League Co-President Paula Montgomery, as she introduced Escambia County Administrator Charles Oliver — “who goes by ‘Randy,’ I believe.”

Oliver passed out some informational pamphlets, then launched into EDATE 101.

“The purpose of it is to create partnerships with businesses,” he explained, “to keep and maintain jobs.”

When local voters go the polls during the upcoming GOP primary, they will be asked to consider EDATE, which gives new or expanding businesses a break on their property taxes. The loose acronym translates to Economic Development Ad Valorem Tax Exemption.

“You may see their red and white signs around,” Oliver said, referencing the referendum’s campaign.

In short, EDATE allows county officials to give new or expanding businesses a certain amount of relief when it comes to property taxes. Businesses could receive up to a 100 percent tax break, but the amount will correspond to how many jobs they bring to the area.

Businesses would only be eligible for an exemption if they are new to the area, or are expanding an existing business. Expanding businesses will only be eligible for the breaks on the expansions.Taxes on land, or associated with the local school district or utility authority, do not factor into the equation.

Oliver said that EDATE acts as an incentive for businesses looking to relocate.

“We’re competing not only in the southeast, but in today’s world, around the country and around the world,” the county administrator said.

When a business applies for an EDATE exemption, the request goes before the county. Officials use a point system to decided how much—if any—of a discount is merited. Basically, the more jobs, the more points, the more exemption.

But county officials aren’t interested in writing off ad valorem taxes for just any business. Prospective EDATE candidates will need to bring higher-end jobs to the table.

“The goal—anytime you do economic development— is to raise the quality of life,” Oliver said, later adding — “Why subsidize a fast-food joint?”

The quality of the company and the jobs could also come into play when officials determine how much of a break they’re willing to grant.

“If Microsoft moved its offices here, obviously it’s going to be scored quite differently than a call center,” Oliver explained.

League members were interested in learning exactly what type of businesses might be lured to the area. One woman said she didn’t want to see any more companies like International Paper —“or the pollution they create.”

“That’s definitely a consideration,” Oliver said, explaining that companies—and the higher-end workers they employ—usually focus on areas with a higher quality of life, which wouldn’t jive with worsening environmental factors. “No, were not talking about any steel smelting plants or anything like that.”

League members were also concerned that the county might be throwing out ad valorem dollars in a pro-business frenzy to attract jobs. Oliver maintained that the premise of EDATE is that the theoretical businesses it attracts would never have entered the scene without the proper incentive in place.

“It’s a revenue that one would argue that we’d never get,” Oliver said.

You Might Also Like

  • Lewis January 21, 2012 at 10:56 am

    When attempting to attract a new business, the largest incentives, in Florida, come from the State. In the case of a State incentive, the county is required to come up with a match, usually 20% of the state incentive. Rather than taking funds from the General Revenues of the county, the county can count the EDATE as that required match.
    Actually, in this economy, a vote against EDATE is truly a vote against providing the opportunity for our children and grandchildren to live and work in our community. It is a vote against family.
    Go to your polls and vote “yes” for your children.

  • Courtney January 18, 2012 at 11:43 am

    Cierra, I was just using the $28k/yr as a hypothetical. I don’t know what that average is, but I think that would be a very safe estimate of an AVERAGE, not the highest paid, for employees at those listed companies in Escambia County. One of the factors used to decide whether the EDATE will be issued to the company is pay so I don’t believe anything less than the county average for an individual is being used.

  • Cierra January 18, 2012 at 11:09 am

    Thanks for the link Courtney. That’s what I was looking for!
    But really? $28K is higher-end jobs?

  • dot January 18, 2012 at 10:53 am

    it’s not totally a matter of whether they can financially make it without the incentive…it is the over all impact incentives make compared to our neighboring state. every little bit helps close gaps and reduce risk. this is an important element of the packages that can be offered to induce a company…each element alone doesn’t make or break, but combined each is a powerful tool.

  • Courtney January 18, 2012 at 10:45 am

    Ames, I think that’s a valid concern, but if you take a look at a few examples of some of the companies that are using EDATEs now (Navy Federal Credit Union, General Electric), it isn’t a factor for them with respect to solvency. The purpose is to create incentives for current companies or businesses wanting to relocate here to hire more employees and make more capital improvements than what they may originally planned for at the onset. Or, if they really like this area, but another municipality is recruiting with the same type of incentive they are less likely to think about locating elsewhere.

    Cierra, the EDATE has been around since 1992 so it’s certainly not a new item. It has to be renewed every ten years by the citizens. The Chamber of Commerce and Escambia County both have information up on their websites which I found fairly useful: There have been about 4,000 jobs created by the companies participating in that incentive. If you assume they are paying an average wage/salary of $28,000 per year that would be $112,000,000 per year in wages that were created in our county, a majority of which is being spent here. There have also been up to $200,000,000 in capital improvements made by these companies to their properties. Which, I would suspect increases the taxable value of their property so when they are no longer eligible for the EDATE after 10 years, the additional property tax comes back to the county. Whereas, if they left for another county in Florida or another State, altogether, we could have a deficit of that same amount in our economy. When you consider that fact that we don’t have the political clout in Tallahasse that the rest of the state has in getting economic development dollars it’s good to have something like this to entice businesses to be here. Not that we don’t have other, attractive qualities, but it’s nice to have something like this in our back pocket when we’re in competition.

  • Cierra January 18, 2012 at 9:11 am

    This isn’t a new incentive, is it? I’d like to know how this tax break has been used in the past. Which businesses have received this incentive? What has the impact been? That will go a long way in determining whether it’s worth it to vote to continue it.

  • Ames January 17, 2012 at 8:43 pm

    If a business is operating on such a narrow margin that paying their taxes would damage their prospects for success in the community it seems that it wouldn’t take much to shut their doors. Are there no businesses who are more financially able interested in locating here?