Is Florida suddenly closed for business?
Absurd as that idea may seem, it is a growing concern to Tampa Bay's economic development community — a perception that job-competing states may use against this state and its metro areas.
For months, our economic development leaders here have watched and winced as the state Legislature condemned Enterprise Florida and Visit Florida — the state's key agencies for job recruiting and tourism promotion — as agents of "corporate welfare."
It's a ludicrous description since incentives today are performance based. No new job at above average pay? No incentive.
That did not seem to matter in Tallahassee. The Legislature-passed state budget is now before a clearly unhappy Gov. Rick Scott for review. That budget calls for sharp cuts to those agencies (two of Scott's favorites) in spite of their track records that — while hardly perfect — have successfully attracted major new businesses and higher paying jobs to the state and this metro area, or set year-after-year records for tourist visits statewide.
Craig Richard, the CEO of the Tampa Hillsborough Economic Development Corp., says job recruiting so far this fiscal year is going very well in his piece of this metro area. "We're on a roll," he said in a recent gathering of five area economic, government and education leaders who recently met with the Tampa Bay Times and other media. So far in 2017, Richard characterizes the recruiting numbers as "900 jobs ahead" of where the EDC was in 2016.
But will that last?
Despite recent success, he said, at a recent national development meeting, what's the single question he was forced to answer time and again?
Is Florida still in the economic development game?
"We must counter that perception," he warned.
That's an important goal shared by a range of experts who joined Richard in Tampa to talk with the Times.
Hillsborough County Commissioner Ken Hagan, a veteran of the development game, expressed concern that competing states not pilfer job relocation opportunities in Florida. He pointed to Florida's film industry, whose incentives were taken away in earlier years by Tallahassee lawmakers. Movies that should and could have been made in Florida are more often ending up being produced in other states, especially in adjacent Georgia, he said.
Hagan does not want that poaching to happen on a broader scale because of the state Legislature's draconian cuts this year. He and Richard spoke of incentives as tools to enable states to compete for potential corporate relocations and expansions. Take away those tools, and a state like Florida can be at an immediate disadvantage. Worse, Florida can be simply excluded from consideration for a significant job relocation — and may not even know it.
"A big reason we have been able to compete and attract good jobs here," says Hagan — citing such successfully recruited employers as Citi, Johnson & Johnson, USAA, Amazon and Bristol-Myers Squibb — is the presence of financial incentives. Now, how are we going to be able to maintain this going forward?
"Candidly, I think it is going to be a challenge. If you ask any site selector, they will tell you the importance of financial incentives," Hagan said.
"The days of relying on the weather and our favorable tax climate are long over. I wish it wasn't that way," he said. "But the fact is we do not live in a static environment."
The Tampa Hillsborough EDC gets 43 percent of its job recruiting leads from Enterprise Florida. Or at least it did before this year's downsizing of the public-private state-level agency.
One critical incentive tool that died last year in the Legislature and is not expected to return is the "Quick Action Closing Fund" that has played important roles in winning some major deals in the past.
The absence of that tool means site selectors will likely use its absence to differentiate Florida from competing state locations that can tout their own quick action closing funds.
"In the site selection process, it is an elimination game," said Richard who earlier worked in such competitive states as Texas, Georgia and Kentucky. "I know for a fact those states have war chests at their disposal to market and to do deals. That puts us at a competitive disadvantage by handicapping our state economic development organization."
Nobody, of course, wants an economic slowdown. Especially the quintet gathered this past Wednesday at the Tampa Hillsborough EDC.
For Ed Peachey, the job-training veteran CEO of CareerSource Tampa Bay, it's a lot easier to place trained workers at companies when the economy is growing, businesses need specific skills that he can help deliver, and the demand for new jobs is strong.
At the University of Tampa, provost and vice president for academic affairs David Stern said the private school was less dependent on government funding but no less sensitive to the economic climate. A perception that Florida is closed for business only makes his task tougher of recruiting strong students to the school and, also, in encouraging them to stay in the area after graduation and build a career. Stern also cited the change in climate in the United States that has many international students wary and less comfortable of coming to a country that seems less friendly than it once did.
At Saint Leo University in Pasco County, vice president of advancement Denny Moller echoed Stern's concerns. The university pays particular attention to veterans and operates programs at MacDill and other military bases.
At Hillsborough Community College, workforce training vice president Ginger Clark spoke of the "silver tsunami" of many workers beginning to retire in droves in certain industries that require young people with skills to replace them.
HCC's training of welders is in such demand, Clark said, that employers attended the last graduation and literally interviewed welding candidates on site, the moment they officially graduated.
That works beautifully, as long as the jobs keep coming.
Hagan perhaps wrapped it up best by noting that companies have choices in an increasingly competitive market. Florida and Tampa Bay must deal with states that are "rolling out the red carpet and offering an abundance of incentives.
"We are competing against states like Alabama, Mississippi, Georgia — states that we never thought we would compete against but we are."
To fight the misperception that Florida's no longer in the hunt, Hagan says the county will become more aggressive in bringing in site selectors and attracting tourists and "essentially telling our story, our successes and making sure we are on their radar."
And, Hagan added, "we will continue with our localized incentives."
State legislators may be clueless when it comes to keeping Florida competitive. Rest assured, the folks here get it.
Contact Robert Trigaux at [email protected] Follow @venturetampabay.