Florida's urban areas offer a wealth of unique opportunities and incentives.
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When Euro-Bake LP, a wholesale bakery in downtown St. Petersburg, wanted to expand, owner and President Harty Gerhard felt he had few choices at his current location. To find the space he needed, Gerhard was prepared to relocate.
Fortunately, he says, St. Petersburg Mayor Rick Baker heard about the impending relocation, dropped by the bakery's offices on 19th Street South, and said, "We don't want to lose you."
Euro-Bake is located in one of the state's urban Enterprise Zones, so the city was able to "fast track" to keep Euro-Bake in town, says Dave Goodwin, St. Petersburg's economic development director. The city of St. Petersburg owned a part of the land Euro-Bake needed for expansion, and a private owner held the rest.
To retain Euro-Bake in the downtown area, the city first acquired the privately owned segment of land, then sold both segments to Euro-Bake at cost-- $317,000--thus giving the bakery an entire city block. The city also provided some site cleanup, demolished an existing structure and waived parking restrictions to allow for 32 right-of-way parking spaces for Euro-Bake employees.
Euro-Bake has since grown to 150 employees, Gerhard notes, and the added space will allow for an expansion of 200 to 250 employees by the end of 2007. "What the city did for me was unbelievable," Gerhard says.
Euro-Bake's experience is one example of how the public sector in Florida is working with private enterprise to encourage neighborhood revitalization and the retention of businesses in urban areas. Stimulated by an improved business environment and the state's tremendous economic growth in recent years, urban inner city areas are undergoing a renaissance of sorts.
As more and more people are attracted to the cultural opportunities available in central cities, urban core areas are becoming magnets for business development, and Florida's urban Enterprise Zones play a key role in this shift.
Florida has 28 urban Enterprise Zones, which are specific geographic areas designated for economic revitalization. Enterprise Zones encourage economic investment and growth, particularly in distressed areas. The incentives available to businesses that take advantage of these zones include tax refunds, exemptions and credits, plus economic support to encourage location to or expansion within the zone boundaries.
And Florida makes it easy for businesses to get involved. The paperwork necessary to take advantage of Enterprise Zone incentives is downloadable from the Internet, and the tax refund process, through the Florida Department of Revenue, has been made more user-friendly.
Advantageous financing Businesses intending to locate in urban inner city areas may also take advantage of the Front Porch Micro Loan Program. This program was initiated in 2000 to make small loans to entrepreneurs in designated Front Porch communities throughout the state of Florida.
Community Redevelopment Agencies have been established in many cities to spur neighborhood revitalization. In Southeast Florida, for example, Florida Atlantic University's Center for Urban and Environmental Solutions (CUES), the Department of Urban and Regional Planning (DURP) and the Institute of Government (IOG) have teamed up to assist communities in resolving urban and environmental issues in order to redevelop and revitalize the region.
Federal programs available to encourage urban development include Federal Empowerment Zone and Enterprise Community designations, which carry their own tax incentives.
Florida Brownfields: Gateway to Greenfields
Florida is one of the most active states in the Southeast in terms of brownfields revitalization programs. In fiscal year 2005-06, a dozen business expansion/location projects were approved to receive monies from the Brownfields Redevelopment Bonus fund. These projects were committed to create at least 1,734 jobs and, combined, represent total capital investments of more than $121 million in state-designated brownfields areas.
The Brownfields Redevelopment Bonus is available to encourage redevelopment and job creation within designated areas. An approved application may receive a tax refund equal to 20% of the average annual wage of the new jobs created in a designated brownfields area, up to a maximum of $2,500 per new job. Refunds are based on taxes paid by the business, and no more than 25% of the approved refund may be received in a single fiscal year.
Under legislation passed in 2006, developers in Florida who incur costs related to site cleanup may recover up to $1 million in tax credits in the final year of cleanup, with additional perks for redevelopment that results in affordable housing.
"Lenders will now be more willing to fund redevelopment projects in designated brownfields areas because the Legislature has increased the amount of the existing loan guarantee from 10% to 50% on loans for cleanup and redevelopment activities," says Roger Register, legislative committee chair for the Florida Brownfields Association. And the loan guarantee is increased by an additional 25% when redevelopment results in additional affordable housing, he notes. There were 22 new designated brownfields areas in Florida in 2005, says Jack Ray, vice president of Enterprise Florida, "and we've seen a really strong up-tick in the number of communities that participate in this program."
"Increasingly in Florida, parcels of land for redevelopment in urban core areas and areas within primary service districts that are zoned properly are hard to find," Ray adds. "The market place is starting to shift and paying more attention to these somewhat environmentally challenged pieces of land because it is cost effective to do so and these are very attractive pieces of land"--for everything from manufacturing to affordable housing to condominiums to mixed use types of facilities.
For Escambia County--and its largest city, Pensacola, in particular--the brownfields program is a high priority. By designating the available land as parcels, the process for taking advantage of the incentives associated with brownfields has been streamlined, says Matt Dimitroff, environmental administrator for the city of Pensacola.
Pensacola has processed a halfdozen brownfields projects over the last five years, including a vacant lot on Main Street that is now home to Baskerville-Donovan Engineering. Several more projects are under exploration, Dimitroff notes.
In fact, Escambia County is so enthusiastic about potential brown- fields development that it is creating a "Brownfields Calculator," according to Glenn Griffith, brownfields coordinator for the Escambia County Community Redevelopment Agency's neighborhood and environmental services department. Anyone thinking of relocating a business "can go to our website (www. myescambia.com/departments/nesd/brownfieldsprogram. php), click on a parcel in our county or in our Brownfields Redevelopment Areas and calculate how much it would cost them and how much they would save," he explains.
|Urban Enterprise Zone Incentives
|Businesses located in urban Enterprise Zones may be eligible for many special financial incentives, tax credits and refunds.
|Business Equipment Sales Tax Refund
|For sales taxes paid on the purchase of certain business property used exclusively in an Enterprise Zone for at least three years.
|Building Material Sales Tax Refund
|Applies to sales taxes paid on the purchase of building materials used to rehabilitate real property located in an Enterprise Zone.
|Property Tax Credit, Corporate Income Tax
|Credit against Florida corporate income tax equal to 96% of ad valorem taxes paid on the new or improved property.
|Sales Tax Exemption for Electrical Energy
|A 50% sales tax exemption on the purchase of electrical energy, if the municipality has reduced the municipal utility tax by at least 50%.
|Community Contribution Tax Credit
|50% credit on Florida corporate income tax, insurance premium tax or sales tax refund for donations made to local community development projects.
|Urban Job Tax Credit Program
|Eligible businesses locating within 13 designated urban areas and hiring a specific number of employees may be eligible for job tax credits.
|Job Tax Credit, Sales and Use Tax
|Credit for $500 to $2,000 per quali- fied job at eligible businesses taken against the Florida Sales and Use Tax. Cannot be used in conjunction with the corporate income tax credit.
|Job Tax Credit, Corporate Income Tax
|Credit for $500 to $2,000 per qualified job at eligible businesses taken against the Florida Corporate Income Tax. Cannot be used in conjunction with the sales and use tax credit.