Miami company fails after getting taxpayer-funded tax deal
A Miami-Dade company that received a large tax incentive deal from the state of Florida folded last week, casting another black eye on the state’s job recruitment incentives program.
Banah International Group, a sugar company, was approved for a “qualified target industry” tax credit worth $437,000.
Adding insult to injury: News that Banah’s chairman had been convicted of cocaine trafficking just a few years before the company was approved for incentives.
Enterprise Florida, which does much of the vetting in Florida’s multimillion business incentives program, has been under heightened scrutiny in recent weeks as lawmakers have questioned the practice of doling out tax breaks and cash to companies promising to create jobs. EFI said that Banah did not disclose the criminal past of its chairman.
The organization pointed out, in all capital letters, that Banah did not receive any tax money from the state because it failed to create the jobs it promised.
“IF A COMPANY CANNOT MEET ITS CONTRACTUAL OBLIGATION, IT RECEIVES NO REFUND, AND WILL BE REMOVED FROM THE PROGRAM,” an Enterprise Florida spokeperson wrote.
Gov. Rick Scott is asking the Legislature to approve nearly $300 million in incentives funding this year, a massive increase from about $111 million last year.
Lawmakers are skeptical about the funding request, especially after at least three companies have gone bust in the last year after accepting taxpayer-funded incentives deals.
Groups like Integrity Florida and the Koch-brothers sponsored Americans for Prosperity have slammed Enterprise Florida’s incentive program, saying it picks “winners and losers” in the marketplace. When a company goes bust after accepting government funds—as was the case with Solyndra and Florida’s own Digital Domain—critics blame the government for picking a loser.
EFI has countered that narrative by stating it is using the taxpayer funds to recruit companies that create high-paying jobs in Florida.
Most of the deals that it approves go on to fulfill—and often surpass—their requirements, EFI has said.
In the case of Banah, EFI was surprised by the bankruptcy.
“There were no concerns regarding the financial viability of Banah,” EFI said.