Layering Financial Incentives Lowering the Bottom Line 15th FBA Annual Conference October 28, 2012
Presentation Overview Florida Brownfields Program Brownfields Redevelopment Act Economic Incentives Other Brownfields Redevelopment Incentives Q&A 2
Brownfield Redevelopment Act In 1997, the Florida Legislature enacted the Brownfields Redevelopment Act, creating a process for the designation of "Brownfield areas" by local governments. Under Florida law, "Brownfield sites" may be designated "Brownfield areas." Key aspects of the Act that encourage redevelopment include, but are not limited to the following: Liability protections; and Economic incentives, such as tax credits and refunds. Sections 376.77-.875, Florida Statutes Florida Brownfields Program 3
Brownfields Definition: A brownfield area is defined by statute as a contiguous area of one or more brownfield sites, some of which may not be contaminated, and which has been designated by a local government by resolution. A brownfield site is defined by statute as real property, the expansion, redevelopment, or reuse of which may be complicated by actual or perceived environmental contamination. 4
Brownfields Redevelopment Act The two primary goals of the Brownfields program are site cleanup and economic development. Florida Department of Environmental Protection Responsible for site rehabilitation and cleanup Enterprise Florida (EFI) Directed to market the Brownfields Redevelopment Program 5
State Brownfields Redevelopment Incentives Financial Incentives ($) Brownfield Redevelopment Bonus (288.107 F.S.) Voluntary Cleanup Tax Credit (376.30781 F.S.) Sales Tax Credit on building materials (212.08 F.S.) Brownfield Loan Guarantee Program (376.86 F.S.) Regulatory Benefits Cleanup Liability Protection (376.82 F.S.) Other Financial and Regulatory Benefits Brownfield Redevelopment Economic Incentives (376.84 F.S. & 380.0657 F.S.) Expedited Permitting (403.973 F.S. and 380.0657) Workforce Training (Workforce Florida) 6
Performance based Florida Brownfields Program Brownfield Redevelopment Bonus Up to $2,500 in tax refunds per new Florida job created Taxes are refunded only after businesses have met their capital investment, job creation, and wage thresholds. Refunds are paid over a minimum four year period to ensure jobs are maintained. Locally driven Resolution from local community Brownfield site/area designation Approve the redevelopment project to participate in the state incentive(s) program(s) Provides local support (cash, Ad valorem tax abatement, reduce lease rate, etc.) The municipality may request a waiver of the local financial support match 7
Brownfield Redevelopment Bonus Two Ways To Qualify Be a qualified target industry business under the QTI Program QTI/Brownfield Bonus Applicable Statutes: 288.106 and 288.107, F.S. Stand-alone Brownfield -- Applicable Statute: 288.107, F.S. 8
Brownfield Redevelopment Bonus QTI Program Provides a base QTI tax refund of $3,000 per net new full-time-equivalent Florida job created This QTI refund amount can increase to: $6,000 per job in Enterprise Zone or Rural County; $2,500 per job for locating in a designated Brownfield Area; An additional $1,000 for paying 150% of average wage; or $2,000 per job for paying 200% of average wage. A QTI project located in a designated Brownfield Area and paying 200% average wage is eligible for a refund of $10,500 per job award. 9
Brownfield Redevelopment Bonus QTI Program Continued Must apply to Enterprise Florida prior to making a decision to locate or expand in Florida Applicant must: Be in a target industry Must serve multi-state and/or international markets Must be able to locate in other states Must not be a retail establishment Demonstrate that the tax refund will make a material difference in the company s decision to locate or expand in the community Create at least 10 net new full-time equivalent Florida jobs and, if an expansion project, increase employment by at least 10 percent (whichever is greater) 10
Brownfield Redevelopment Bonus Stand Alone Demonstrate a fixed capital investment of at least $500,000 in mixed-use business activities ($2M if the site requires remediation) Create at least 10 new Florida full-time jobs with benefits Show that the project will diversify and strengthen the economy of the area surrounding the site Typically for projects that do not meet QTI thresholds Projects are not in the State s target industry sector (288.106 F.S.) 11
Brownfield Redevelopment Bonus Stand Alone Application should be submitted before the decision has been made to locate in a brownfield Discretionary incentive -- not an entitlement As an incentive, the Bonus must play a role in the decision of a company to locate or expand in a brownfield area It need not play the decisive role, but it must be a part of the decision-making process and overall site selection equation Ideally, the need for a Bonus incentive should be established, and the Bonus application approved, before any commitment is made to the project 12
Other Brownfields Redevelopment Incentives Building Materials Sales Tax Refund 20% Low to Moderate Income Encourages Affordable and Workforce Housing Brownfields Loan Guarantee 50% of Primary Lender s Loan 75% for Affordable Housing and Health Care Facilities 13
Quick Response Training (QRT) is an employer-driven training program administered by Workforce Florida The company may use in-house training, outside vendor training programs or the local educational entity to provide training. Reimbursable training expenses include: instructors'/trainers' wages; curriculum development; and textbooks/manuals. Florida Brownfields Program Quick Response Training Businesses approved for QRT funding are limited to one grant award per site every two years. 14
Incumbent Worker Training (IWT) is administered by Workforce Florida and provides training to currently employed workers The program is available to all Florida businesses that have been in operation for at least one year prior to application $50,000 maximum per business Florida Brownfields Program Incumbent Worker Training Priority is given to businesses in targeted industries, Enterprise Zones, HUB Zones, Inner City Distressed areas, Rural Counties and areas, and Brownfield areas. 15
Brownfield Redevelopment Bonus Contact Info: Enterprise Florida, Inc. Joseph Bell Program Manager 407.956.5622 jbell@eflorida.com www.eflorida.com 16
Brownfields Redevelopment