LARGO — On the crowded Nov. 6 ballot, below the long list of candidates for president, U.S. Senate, County Commission and other offices, city voters will have a question to answer: "Shall the City Commission of the City of Largo be authorized to grant … property tax exemptions to new businesses and expansions of existing businesses that are expected to create new, full-time jobs in the City of Largo?"
If a majority of city voters say "yes," then Largo will become the second, or possibly the third Pinellas County city to take advantage of a property tax incentive program the state Legislature approved in 2011. (Clearwater voters will also have a tax incentive referendum question in November.)
And while one city commissioner is concerned about the potential impact on Largo's tax coffers, the rest were convinced by this sales pitch from the city staff: The program probably won't be used often, but if it is used, it will be worth it.
State law allows cities and counties to grant property tax exemptions to new or expanding businesses in select industries that meet strict job creation guidelines. Jobs must pay more than the average salary in Pinellas County, which was $40,372 as of Jan. 2012. The minimum required number of jobs created to get tax breaks varies depending on the industry, from as few as 10 for a manufacturing company, to a minimum of 50 for a corporate office.
City Commissioner Bob Murray expressed reservations about the program, and was the only commissioner to vote against putting it on the ballot at last week's commission meeting. Murray is concerned about the potential impact on Largo's property tax revenue, hurt by years of dropping property values.
The city's economic development manager, Teresa Brydon, allayed other commissioners' concerns, however. The tax exemptions are not for property, she pointed out, only for improvements made to a property. Businesses that want the tax breaks must get City Commission approval first, and must show every year that they are keeping job creation promises.
"This is not an easy incentive to get," said Brydon.
If voters approve the program in November, the city staff will need to develop specifics. State law allows cities and counties to grant up to 100 percent tax exemptions on property improvements, but some cities have crafted less generous programs. Clearwater's proposed program would only grant a 75 percent exemption, for example, and would require a minimum capital investment of $100,000 in a property, according to Geri Lopez, Clearwater director of economic development and housing.
Voters have already approved similar programs in St. Petersburg and Tampa, but they have yet to reap massive returns. St. Petersburg's economic development staff is still working on the details of its program, which needs City Council approval before it can be used.
Voters in at least 38 Florida counties and more than 20 cities have also passed similar programs. If approved, the program would be in place for 10 years in Largo, with the option to put it back out to referendum in 2022 for another 10 years.
Will Hobson can be reached at (727) 445-4167 or [email protected] To write a letter to the editor, go to tampabay.com/letters.