Study: Florida's job creation programs unevenly policed

Published Jan. 19, 2012

Florida's array of programs that subsidize companies for creating jobs is run slightly better than average compared to other states' programs, a new national study suggests.

However, Florida falls short in enforcing penalties against some companies that fail to deliver promised jobs, and it does an even worse job at disclosing those failed efforts to the public.

In fact, while most of the country has been doing better with online disclosure, Florida is headed the opposite direction, according to principals with Good Jobs First, author of the incentives study.

And it's not just tax incentives. The state has regressed on disclosing expenditures under the massive federal stimulus plan, Good Jobs First said.

"Florida is a strange case," said Philip Mattera, research director at Good Jobs First, a nonprofit that has been tracking state incentive programs since 1998. "There was some online disclosure (in Florida), and then when Gov. (Rick) Scott took over, that website was removed and last we heard has not been replaced."

Some limited disclosures have come through Enterprise Florida and a media-triggered spreadsheet about subsidy deals going back to 1995. But that information is not readily accessible through the state's own website, he said.

The Florida Department of Economic Opportunity said Wednesday that it is currently updating the database to track incentive performance, a database it inherited from the former Office of Tourism, Trade and Economic Development.

Department spokeswoman Nancy Blum defended the state's incentive programs as among the best in the country. Blum downplayed issues of enforcement and retrieving funds, noting that most of Florida's contracts are pay-for-performance, meaning businesses don't receive funding until after they meet certain benchmarks.

The study found 10 percent of major state programs still do not require companies to report to agencies on job creation, and many more fail to adequately monitor recipients. Florida tied for 14th overall, rating a "C" grade. It found Florida had stronger underlying standards than many states, but relatively weak enforcement.

Two of Florida's programs in particular received low grades for not penalizing companies that fail to meet their job-creation objectives: the Economic Development Transportation Fund and the much-touted Qualified Target Industry Tax Refund used to lure higher-paying jobs.

Blum, however, said the state has used "clawbacks" and other sanctions to retrieve funds when appropriate. Since 2002, 10 companies have returned more than $10.5 million for not meeting performance measures under one state program.

Florida's best marks were for its requirements that companies report and verify their job creation. At the very least, Mattera said, all states should verify any job creation promises by checking on unemployment records. On that point, "We agree with Ronald Reagan," Mattera said. "Trust, but verify."

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An analysis last fall by the Times/Herald Tallahassee bureau noted that Florida had signed contracts worth $1.7 billion since 1995 in return for promises of 225,000 new jobs. But only about one-third of those jobs had been filled, the analysis found, while the state has paid out 43 percent of the contracts.