Commissioner Moran calls for action as means of prompting Economic Development Corp. changes
Since he was elected to the board in November 2016, Commissioner Michael Moran has complained that the Economic Development Corp. of Sarasota County (EDC) has failed to offer detailed documentation showing “clear results” of its efforts to recruit businesses and, especially, jobs to Sarasota County.
On June 8, Moran won the support of two of his four colleagues to eliminate the county’s Local Business Tax by the end of the 2024 fiscal year. The estimated $1 million in annual revenue from that tax has gone directly to the EDC.
The tax would be lowered by a third each fiscal year over a period of three years, Moran said. The process would not start until the 2023 fiscal year, which will begin on Oct. 1, 2022.
As Sarasota County Tax Collector Barbara Ford-Coates’ website explains, “The Sarasota County Business Tax is to be paid when a business begins operation and is in addition to any other fees paid to operate a business.” A business owner can register online and then check with Ford-Coates’ staff “to confirm the amount due,” the website adds.
On a separate motion, Moran also won a board majority for removing all but $1 million from the Economic Development Incentive Fund (EDIF). The money would return to the county’s General Fund.
He noted that in the second quarter of 2012, the commission agreed to put $5,956,450 into that fund. However, Moran said, he believes only about $4.3 million remains.
“We can always put it back,” Moran said.
The commission years ago also placed $10.78 million from the sales of escheated North Port lots into the EDIF, Moran noted, but that all had been spent to try to draw companies to Sarasota County.
“I’m fine doing that,” Commissioner Christian Ziegler added after seconding the motion for the EDIF action. If the board members later feel the EDC is complying with the commission’s requests, Ziegler pointed out, they can return the money to the EDIF.
The County Commission actions came in spite of pleas from representatives of the EDC and Chambers of Commerce, including comments made during the Open to the Public portion of the board’s June 8 morning session.
“This is going on four-and-a-half years,” Moran told his colleagues that afternoon, referring to his effort to get information from the EDC. “This board still does not have meaningful reporting that we can show to the taxpayers, to show return on investment.”
His proposal for phasing out the tax, Moran added, gives the EDC about 16 months to “show us, show the taxpayers … clear deliverables that are obvious to all.”
“I’m not suggesting we don’t have an EDC,” Moran pointed out. “I’m just suggesting it’s not funded with taxpayer dollars after September of 2024.”
Businesses and the Chambers can provide monetary support to the organization, he said.
On its website, the EDC calls itself “a catalyst for economic opportunities.” The website adds, “We connect entrepreneurs, business leaders and major corporations to new and exciting development opportunities. Whether it’s for expanding an existing enterprise or relocating a business to Sarasota County, we can help.”
Commissioners Nancy Detert and Ron Cutsinger protested both the elimination of the Local Business Tax and the removal of funds from the Economic Development Incentive Fund.
Although Detert concurred with Moran about frustrations with the EDC’s operations when she and Moran first won their board seats, she pointed to improvements over the past 18 months since Dave Bullock, former manager of the Town of Longboat Key and former deputy county administrator, became the interim CEO of the organization.
Ziegler also pointed out that the EDC leadership prior to Bullock’s hiring as interim CEO “was very troubling. … I think Dave Bullock does a fantastic job.”
“There’s been a refresh,” Commissioner Cutsinger added, referring to the EDC’s operations with Bullock at its helm.
Moreover, Detert and Cutsinger voiced alarm that Moran’s plan would convince a person whom EDC leaders have selected to replace Bullock that the person should not take the job.
“If I’m a potential candidate as a CEO looking at perhaps moving my family to Sarasota County,” and the County Commission voted to defund the EDC, Cutsinger pointed out, “I can’t see moving here …”
Detert concurred with Cutsinger, noting that, as she understood it, the EDC leaders believe they “have a sterling candidate.”
Moran explained that Bullock, and EDC Chair Charlie Murphy, executive vice president and market president for The Bank of Tampa, told him the candidate had decided not to relocate to Sarasota. “They asked if I was willing to call him,” Moran continued. “I called him. I was probably on the phone for over an hour. He is a super sharp person, super sharp.”
Moran added that the candidate reported that he would not take the EDC job unless he had a “clear understanding of what’s expected of [him].”
Moreover, Moran told his colleagues, the candidate wants to see the Local Business Tax phased out.
Nonetheless, near the end of the nearly hour-and-15-minute discussion, Detert and Chair Alan Maio debated the status of that candidate’s willingness to take the job.
Maio serves as the commission’s liaison to the EDC board.
“Do you understand that he has turned this job down?” Detert asked Maio at one point.
“But he might still come,” Maio replied. “That’s what I’ve been told.”
‘The last word to us is he’s turned us down,” Detert insisted.
“The last word to me,” Maio responded, was that the candidate might still take the job, depending on what happened during the commission discussion that day.
Maio also suggested that, if the EDC leaders invited the candidate to come talk one-on-one with the commissioners, he felt the candidate would do that. Maio indicated that he felt such discussions would persuade the person to take the EDC job.
Diving into the discussion
After Moran presented his proposal to eliminate the Local Business Tax, Detert was the first to announce, “I certainly am against that idea.”
When she owned a mortgage firm before she began seeking elected office, she explained, her Local Business Tax payment was about $25 a year. If the commissioners phased out the tax, she continued, “We would not be saving that taxpayer enough money to buy a cup of coffee per day at McDonald’s, and they could forget about going to Starbucks.”
She acknowledged that the board members’ complaints about the EDC were well documented. However, she added, “We chipped away, chipped away, chipped away, complained constantly,” and the situation has improved.
Referencing the candidate the EDC had chosen to be the new CEO, Detert said, “This is no time to handcuff the guy. … I also think we’re in danger here of micromanaging.”
Commissioner Ziegler asked about the potential of continuing to collect the full Local Business Tax and just setting aside the revenue that no longer went to the EDC. Then, the board members would not have to consider reinstating the tax “if we do see a turnaround performance” of the EDC.
Detert expressed the same concern about the tax. Referring to reinstating it after its elimination, she said, “That’s called a tax increase. … When it’s gone, people have a short-term memory.”
In response to a comment from Moran that businesses could opt to tax themselves to help fund the EDC, Detert pointed out, “That is not a reliable way to fund any [organization] that I know of.”
However, Ziegler said of the opt-in alternative, “I’ve head from a lot of people” that business owners would do that. Still, he acknowledged, he had not researched the issue.
After Moran made the motion to eliminate the tax, Ziegler said, “I’m not against the EDC.” By this time next year, he added, he hoped the commissioners would see the EDC providing the type of information the commission has been requesting.