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Robert J. Luck elevated to appeals court judge

Gov. Rick Scott on Wednesday appointed Circuit Judge Robert J. Luck to the 3rd District Court of Appeal in Miami.

Luck, 37, of North Miami Beach, has served as a circuit judge for the 11th Judicial Circuit since 2013.

He previously was an Assistant U.S. Attorney and Deputy Chief at the United States Attorney’s Office for the Southern District of Florida.

Luck received both his undergraduate and law degrees from the University of Florida. He fills the vacancy created by the Jan. 3 retirement of Judge Frank A. Shepherd.

Alan Abramowitz reappointed head of Guardians ad Litem

Gov. Rick Scott reappointed Alan Abramowitz as head of the state’s child advocates program.

The Governor’s Office announced the appointment Wednesday night for a term of Feb. 8, 2017-Feb. 8, 2019.

Abramowitz, 54, of Tallahassee, has been Executive Director of the Statewide Guardian ad Litem Program since 2010.

Guardians ad litem represent the interests of children in court proceedings, especially in divorce and juvenile dependency matters.

Abramowitz, who served in the Florida National Guard and the United States Army from 1983-98, was state director for family safety for the Department of Children and Families.

He’s also been chief legal counsel for the Department of Children and Families’ Central Florida area and Assistant General Counsel for the Department of Juvenile Justice.

Abramowitz received his bachelor’s degree from Kansas State University, his law degree from Florida State University, and his master’s degree from the University of Central Florida.

House panel votes to kill Enterprise Florida, VISIT FLORIDA

A Florida House panel Wednesday cleared a bill that would eliminate the Enterprise Florida economic development organization, the VISIT FLORIDA tourism marketing agency, and a slew of economic incentive programs.

The Careers and Competition Subcommittee OK’d the proposal (PCB CCS 17-01) by a nearly party-line vote of 10-5.

One Democrat voted for it, Miami’s Roy Hardemon, and one Republican was opposed, Sarasota’s Joe Gruters – an ally of Gov. Rick Scott, who believes in incentives. 

The committee room was packed with bill opponents, including those in the service and tourism industry and many from rural areas, who said economic development and tourism marketing was vital to their livelihood.

Passing the bill as is will “destroy our tourism industry,” said Carol Dover, president and CEO of the Florida Restaurant and Lodging Association, speaking for the thousands of “waitstaff, cooks (and others) worried about losing their jobs.”

The legislation comes in the wake of VISIT FLORIDA CEO Will Seccombe’s December resignation, the last casualty of a kerfuffle over a secret contract – later revealed to be worth up to $1 million – with Miami rap superstar Pitbull to promote Florida tourism.

Moreover, Scott’s continued support of incentives puts him at odds with House Speaker Richard Corcoran, who has derided Enterprise Florida as a dispenser of corporate welfare.

“Politicians in @MyFLHouse turned their back on jobs today by supporting job killing legislation,” the governor tweeted after the vote.

Chris Hudson, state director of Americans for Prosperity-Florida, lauded the vote as the death knell of “bloated subsidies.”

“Lawmakers were elected to serve the hardworking people of the state, not well-connected special interests that seek lucrative deals to pad their bottom line,” he said.

“… We applaud the members of this committee who today stood up for fairness, for principle, and for Florida taxpayers.”

But dozens more local officials and small business owners came to Tallahassee to oppose the legislation. Dairy owners joined oyster farmers, short-order cooks, and fishing captains to tell lawmakers the bill would harm them financially.  

Kelly Paige is president of Film Florida, but also owns Level Talent Group in Tampa. She said the state’s previous ending of a film incentive caused her to lose 40 percent of her workforce.

“This bill actually represents a tax increase for my industry,” she told the panel. “If you repeal (any more incentives), you are saying we are closed for business.”

Eric Fletcher, manager of airport operations for Allegiant Air, said VISIT FLORIDA helped his airline grow 2,000 jobs in the state, bringing in 3 million visitors.

And Visit Florida board chairman William Talbert told the subcommittee “every single representative here knows … we would have a state income tax if it was not for tourism.”

After the vote, state Rep. Halsey Beshears, the Monticello Republican who chairs the panel, said he was impressed by the many stories he heard during public comment.

“Obviously, there’s a huge demand out there for (both organizations), but I do think we have to start from zero,” he said. “Still, we’ll let the Speaker know all the concerns we heard today.

“… Not everything will be zeroed out,” Beshears added. “We cannot ignore all the people who traveled from all over Florida to be heard on this.

“I appreciate the dairy man who said every little bit (of marketing) helps, but then the server in Orlando (who supports the bill) told us we need to be good stewards of the people’s money,” he said.

Rick Scott’s favorite business incentive is losing money, Senate hears

Gov. Rick Scott’s favored economic incentive program – the Quick Action Closing Fund (QAC) – is now losing money, the Legislature’s chief economist told a Senate panel Wednesday.

The QAC is a pot of cash that Scott can draw up to $2 million from without legislative approval to entice businesses to the state.

But though the state’s “return on investment” from QAC projects was $1.10 per dollar four years ago, it’s now down to 60 cents per dollar, Amy Baker told the Transportation, Tourism & Economic Development Appropriations Subcommittee.

In fact, more state incentive programs are losers than winners, according to Baker’s slides. Incentive programs, including the QAC, as well as Enterprise Florida, the state’s economic development organization, and VISIT FLORIDA, the state tourism agency, are slated for elimination under legislation filed in the House. 

Only eight incentives – what Baker called the “strongest of the strong” – make money for state coffers, including the Florida Sports Foundation Grant Program ($5.60 per dollar) and the Qualified Target Industry program (QTI), which now makes $6.40 per dollar invested.

The QTI targets businesses that offer high-wage jobs.

The others either don’t “break even,” though the state may recover some of its costs, such as the Spring Training Baseball Franchise Incentive, Baker’s slides said.

Or the “state loses all of its investment, plus incurs additional costs,” such as Enterprise Zones.

That’s when “we’ve made things worse than it was when we started,” she said, giving the example of no longer taxing something that used to be taxed.

Just breaking even, however, “is a lofty challenge,” Baker said. She noted that a incentive dollar has to “cycle through the economy 16.67 times” to make money for the state.

State Sen. Frank Artiles, a Miami Republican, later asked Baker about the merit of tax breaks for films.

She said they target “the most footloose part” of the film industry, being the shooting of a movie or commercial, “and when they’re done, they’re gone.”

“They’re not building, they’re not ‘nesting’ in local communities,” Baker explained, instead referring to companies that build soundstages here, or focus on “production and editing.”

“They’re less transient,” she said.

Subcommittee chair Jeff Brandes, a St. Petersburg Republican, eventually floated an analogy that instead of just fishing for sharks, lawmakers should focus on keeping “the coral reef” healthy, and that will attract small fish, then bigger fish, then sharks.

DEO “Cissysplains” economic incentives to Richard Corcoran

Gov. Rick Scott has now sicced the Department of Economic Opportunity, headed by executive director Cissy Proctor, on the Florida House to take down its critique of economic incentives.

A news release, issued late Tuesday, continues the cold war of words between the governor, an ardent supporter of incentives, and House Speaker Richard Corcoran, who has called them “corporate welfare.”

The department’s response is reprinted below, unedited and in its entirety:

Today, the Florida House of Representatives used data maintained by the Florida Department of Economic Opportunity (DEO) that was unfortunately used to inaccurately describe the result of the state’s economic incentive programs. DEO would like to take this opportunity to accurately explain the data and how the incentive programs work to create valuable Florida jobs while aggressively protecting taxpayer dollars.

DEO Director Cissy Proctor said, “Before Governor Scott came into office, state incentives were often awarded before stringent requirements were met. However, under Governor Scott, Florida companies receive economic incentives after these requirements are met, including proven job growth and wage requirements.  Only contractual commitments that are met are paid.  This ensures a return on investment for Florida families.”

CLAIM

64.3 percent of the economic incentives listed below were unsuccessful because: 

•They only completed a portion of their requirements for which they were paid and can receive no more payments (inactive) 14.2%

•They never received any payments though a contract was executed and are ineligible for future payments (terminated) 36.9%

•The contract was never signed (vacated) 11.9%

•The application was withdrawn 1.2%

FACT

It is inaccurate to say that all inactive, terminated, vacated and withdrawn projects are not successful. While inactive projects met some performance measures, businesses were only rewarded for the jobs they created. This means the program is working. Only contractual commitments that are met are paid.

For example, if a company moves to Florida and commits to creating 100 jobs over five years but ultimately only creates 75 jobs over four years, the company only receives payments for the 75 jobs created; not for the full 100. Are those 75 jobs a failure? No. Are the 75 Floridians who found a new opportunity to provide for their family or achieve their dreams evidence of a failed project? No.

Job creation should never be viewed as a failure. This process shows the reforms that Governor Scott put in place are working to protect taxpayer dollars while encouraging job growth.

Furthermore, terminated, vacated and withdrawn projects NEVER received taxpayer funds. This shows that the Governor’s strict accountability measures are working to safeguard taxpayer dollars. This is part of the due diligence process that was reformed under Governor Scott’s leadership.

CLAIM

Less than 10% of approved incentives were completed having met all its contractual obligations with the state.

FACT

Many state incentive projects resulted in the creation of new jobs, capital investment, or higher wages in companies across the state. These job creation deals are multi-year projects with multiple different types and sizes of businesses across various industries. A multitude of factors can result in a company changing its business model, which is why Governor Scott’s reforms included strict performance-based contracts for each year of the agreements. In the years that the companies meet their contract goals, jobs are created for Florida families and investments are made in Florida communities. These new opportunities and investments are a success for the state. Again, if jobs are not created, no taxpayer dollars are spent.

CLAIM
A trend worth noting for many of the incentive programs is the common practice of either providing a one or more year extension for the various businesses receiving incentives to meet performance criteria with no award penalty, or simply amending contracts to change performance criteria.

FACT

When companies enter into agreements with the State of Florida, they are projecting performance up to a decade in advance. When initiating their projects, companies may experience delays related to local permitting, construction, renovation, federal contracts, and relocating their business. While some extensions may be provided after a thorough and strict review process, state money is not given out until full job creation, wages and capital investment from the contract are made.

CLAIM

6 out of 10 approved incentives do not result in successful projects

FACT

While inactive projects met some performance measures, they were only paid for the investments that were made. Furthermore, job creation is never a failure. Terminated, vacated and withdrawn projects NEVER received taxpayer funds.

CLAIM
3 (“Active”) of the remaining 4 that could potentially be successful could still end in a status of “Termination” or “Inactive”

FACT

All incentive projects are held accountable for the life of the project and taxpayer dollars are not spent until strict performance measures are met.

CLAIM
12% of approved incentives never execute a contract with the state

FACT

In these cases, companies seeking incentives meet with the state to discuss their business growth plans. During the due diligence process that was reformed under Gov. Scott’s leadership, the state works with the company regarding the strict requirements of the incentive program. At this point, a company may decide not to pursue an agreement. Again, in this case, no taxpayer money is ever spent. This shows that the program is working.

CLAIM
Since 1994 a total of 186 (9.6%) of approved incentives have resulted in a project that completed its contract with the state

FACT

While inactive projects met some performance measures, they were only paid for the investments that were made. Furthermore, job creation is never a failure. Terminated, vacated and withdrawn projects NEVER received taxpayer funds.

CLAIM
No statistics are currently available for the 9.6% to determine how many, if any, were sanctioned during contract performance for failure to meet their full performance requirements

FACT

All performance-based contracts have sanctions and clawbacks in the event that a company is unable to meet a requirement. This is part of the reforms of the incentive process done by Governor Scott, and the state will continue to aggressively pursue efforts to hold companies accountable in order to safeguard taxpayers’ dollars.

A cordial House reception for Scott’s budget, despite off-stage rancor

The House Appropriations Committee gave a respectful reception Tuesday to Gov. Rick Scott’s $83.5 billion state budget Tuesday, with chairman Carlos Trujillo praising the spending plan as “conservative.”

“It’s a very fair budget,” Trujillo told reporters following the meeting. “It was balanced. Some different priorities than we’ve expressed here in the House. But, overall, I think it was very fair, very reasonable, and very well put together.”

Of proposed legislation that would spike Enterprise Florida and Visit Florida — two of Scott’s top priorities — Trujillo said a hearing Wednesday before the Careers and Competition Subcommittee would be telling.

“If the bill goes down in flames tomorrow in committee, we know there’s probably not an appetite for the membership. But if that’s not the case, the appropriations will follow the policy,” Trujillo said.

“I’m assuming it will be reported favorably,” he said.

Asked whether he could recall a time when a proposed committee bill favored by a speaker did not pass, Trujillo had a quick reply.

“Stand your ground, last year in my criminal justice committee.”

The debate over those economic- and tourism-development programs has grown heated, with Scott Tuesday suggesting the bill was motivated by House Speaker Richard Corcoran’s desire to run for higher office.

Informed of the governor’s remarks, Trujillo said: “I would disagree with his comments.”

Regarding the overall budget, Cynthia Kelly, Scott’s top budget aide, briefed the committee on Scott’s plan and answered questions. Several members asked about Scott’s proposal to leave local property tax levels at existing levels, to capture rising property values for schools.

House leaders want to lower that tax rate, to keep tax levels more or less even.

“We do not consider that a tax increase,” Kelly said of the governor’s proposal. “If the rate had been adjusted, that would be different. But as long as the rate is held constant, it is not considered a tax increase.”

House budget subcommittees were to begin hammering out the House’s own spending plan during hearings scheduled for Wednesday.

Rick Scott, state Cabinet OK Ryan Matthews as interim DEP secretary

Gov. Rick Scott and the Florida Cabinet on Wednesday formally approved Ryan Matthews as interim Secretary of the Department of Environmental Protection.

Matthews will serve until Scott, Attorney General Pam Bondi, Chief Financial Officer Jeff Atwater and Agriculture Commissioner Adam Putnam decide on a permanent replacement for outgoing Secretary Jon Steverson.

Until then, Matthews will be paid Steverson’s salary of $150,000. The panel deliberated via conference call, though Matthews was at the podium of the Capitol’s lower-level Cabinet meeting room.

Bondi said she was “impressed” with Matthews, adding “he cares deeply about our environment.”

Matthews, named deputy secretary last year, had been in charge of the department’s air, water, and waste pollution programs and for overseeing the agency’s regulatory districts.

The governor and Cabinet also decided to advertise the secretary opening until April 28, with an aim to agree on a full-time hire during the May 23 Cabinet meeting.

Steverson last month announced his resignation to join the legal-lobbying firm of Foley & Lardner.

 

Lobbying firms misreported income, ethics panel finds

Three Florida lobbying concerns are being reported to Gov. Rick Scott and the Cabinet for incorrectly tallying their income, the Florida Commission on Ethics said Wednesday.

In at least two of the cases, however, the errors were basic accounting mistakes. Lobbyists’ compensation is subject to random audits, some of which are reviewed by the commission.

In a press release, the commission said it found probable cause to believe Dean Mead, a law firm with a lobbying practice, “inaccurately reported compensation received from a principal for the first quarter of 2014.”

The firm also “inaccurately reported compensation received from two principals in the third quarter of 2014.” Probable cause means it is more likely than not that a violation has occurred but is usually not a definitive finding.

Firm shareholder Pete Dunbar in the Tallahassee office said the mistakes were “bookkeeping errors” that were “quickly corrected” before his firm’s audit was finalized. Dunbar’s long government service includes being former Gov. Bob Martinez’s general counsel and legislative affairs director, as well as serving as a member and chair of the ethics commission.

It also found probable cause that Buigas & Associates “overstated compensation received in the second quarter of 2014, as well as the third quarter of 2014.” A message seeking comment was left on an office voicemail.

And the commission found probable cause that D. Darling Consultants “overstated compensation received from a principal for the first period of 2014, and failed to report compensation received from a principal for the fourth period of 2014.”

Firm principal Doug Darling, a “sole shingle” lobbyist, represents only two clients: Accenture and Grant Thorton, both consulting companies. He said he uses the “cash accounting” method, used by most small businesses, instead of the “accrual” method.

“The cash method accounts for revenue only when the money is received,” Investopedia explains. “On the other hand, the accrual method accounts for revenue when it is earned.”

Darling also said the commission’s press release is in error, explaining that the reporting periods in question are fourth period of 2013 and first period of 2014.

Under state law, “probable cause findings … of this nature are forwarded to the Governor and Cabinet,” the commission’s release says, referring to Attorney General Pam Bondi, Chief Financial Officer Jeff Atwater and Agriculture Commissioner Adam Putnam

“The firms have 14 days to submit a written request for hearing to the Governor and Cabinet.” it says. “However, the Governor and Cabinet may, on (their) own motion, require a public hearing and may conduct such further investigation as deemed necessary.”

Adam Putnam agrees: Business experience essential for governor’s job

Agriculture Commissioner Adam Putnam agrees with Gov. Rick Scott that Florida’s next governor should have “business experience.”

“I think someone having business experience that they bring to public life is very helpful,” said Putnam, who spoke to reporters after a speech at Tuesday’s Associated Press annual Legislative Session planning session at the Capitol.

In a recent interview, Scott – who is term limited in 2018 – said the next governor needs to have experience in the business world.

Some took that as a slight to Putnam, long rumored to be eyeing a run for governor in 2018.

The 42-year-old Republican was first elected state agriculture commissioner in 2010 after serving 10 years in Congress. The Putnam family owns Putnam Groves in Bartow.

“As a guy who is part of a small business, I get it,” he said. “You have a better feel for what regulations mean, what the paperwork translates to, and things that often sound like a good idea in Tallahassee, by the time they get to Main Street businesses, they’re a hot mess. It’s helpful to know what it means to create jobs in this state.”

Putnam’s political committee, Florida Grown, has raised funds at an impressive clip, logging nearly $6.8 million in contributions since March 2015, state records show.

This January, it collected $392,500, including a $250,000 contribution from Florida Power & Light, according to its website. It now has cash on hand of almost $4.5 million.

Though Putnam Tuesday continued to decline comment on his future political plans, the latter part of his remarks at the AP event veered into ‘stump speech’ territory, mentioning how the state needs to bolster workforce development, education and rural economic development.

Above being a retirement destination, Florida “needs to be the kind of place that attracts people four decades sooner,” he said, “so that they raise their families here, and they start their businesses here and grow those businesses here, because that’s a very different emotional investment for the long-term good of Florida.”

That sounds strikingly familiar to remarks he made at his political committee’s “Friends of Florida Agriculture Barbecue” in April at Peace River Valley Ranch in Zolfo Springs.

“I want Florida to be the place where people come as a young person, graduate from our universities, raise their families here — start, build and grow their businesses here, so that they are passionately, emotionally invested in the long-term good of Florida, where Florida’s going, how Florida got to be what it is, and what makes Florida special,” Putnam said at that event.

Rick Scott budget proposing cutting $156 million from Tri-Rail over contract

Gov. Rick Scott is proposing cutting $156 million in state funding for Tri-Rail development unless the South Florida Regional Transit Authority reverses its decision to award a controversial half-billion contract to a lone qualified bidder.

Scott’s proposed 2017 state budget now includes an item calling for “no funding” until the authority withdraws, cancels or otherwise terminates the authority’s Notice of Intent for awarding its operating contract to Herzog Transit Services.

On the line is $156 million the state had programmed for Tri-Rail’s capital outlay from the Florida Transportation Trust Fund.

A transit authority spokeswoman said Tuesday the authority was aware of the governor’s action, but said the authority is declining comment right now.

The authority’s board of directors approved the Herzog contract by a 6-2 vote last Friday against objections from the Florida Department of Transportation and state Sen. Jeff Brandes, who chairs the House Appropriations Subcommittee for Transportation.

The Herzog contract is worth $344 million for seven years and has annual extension options that could take it out to 10 years for $511 million. It was awarded after the transit authority’s staff unilaterally rejected five other proposals for the service on technical grounds. Some of the proposals asked far less money, as low as $396 million for ten years.

The other companies bidding on the contract, including the current operations contractor Transdev Services of Maryland, have challenged the staff rulings that there were technical issues with their proposals. Specifically, the staff had cited language that the staff interpreted as meaning the bid prices were conditional. The companies have since responded that is not the case.

The governor’s budget item also declares that before the SFRTA can obtain a new contract for operations and maintenance services, it will have to “obtain the department’s written approval of all items and conditions of the new procurement and contract for the services that were the subject of such request for proposal to ensure the authority has sufficient revenues to fund the contract.

“Further, no funds shall be provided to the South Florida Regional Transportation Authority by the department without the prior review and written approval by the department of the authority’s proposed expenditures.”

 

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