by Karen Brune Mathis
Managing Editor
Local leaders advocating for economic development are asking for more incentives to help, although City Council already is dashing some of those hopes as it meets in workshops to discuss Mayor Alvin Brown’s proposed 2011-12 budget.
The Economic Development Transition Committee appointed by Brown recommended in its Aug. 8 report that the City needs several new or improved incentives to make Jacksonville more competitive and urged a review within the year.
Among them:
• A local closing fund to help the City win more projects. The City Council Finance Committee voted Thursday to eliminate that line item from Brown’s proposed budget.
• An incentive for companies that are increasing their importing or exporting through the Port of Jacksonville.
• More aggressive incentives for targeted industries to locate Downtown.
• Incentives for retailers to locate Downtown.
• Elimination of “self-imposed” restrictions on using state Enterprise Zone and Brownfield incentives Downtown.
• A revolving loan program or grant program, or both, for façade improvements Downtown.
• A permit assistance program to reduce by 50 percent the permit cost of the rehabilitation of empty or dilapidated commercial buildings.
• Elimination for a period of time, or a reduction or ceiling for manufacturing customers, regarding the 10 percent local option public service tax paid to the JEA.
“The Public Investment Policy should be a tool to incentivize business growth that is appealing to policymakers,” said the report.
It said the policy should be reviewed to focus on deals that would create the most jobs in the shortest period of time.
“Jacksonville suffers from some of the highest electricity rates in the state and Southeast which raise the cost of doing business for manufacturers,” said the report.
It said local government can help manufacturers whose electric rates, including taxes, “make them uncompetitive.”
“The rates in Jacksonville are estimated to be 50 percent higher than all other 11 Southeastern states,” said the report, adding that JEA’s newly discounted rate for manufacturers is key to a more aggressive approach “to grow this sector of business in Jacksonville.”
It called on Brown to look into addressing the 10 percent local option public service tax paid to JEA by manufacturers.
“The 10 percent is paid on the base charge and not on the fuel charge,” it said. “This will have a negligible effect on tax revenue with a substantial uptick in competitiveness for this targeted business group.”
JEA spokeswoman Gerri Boyce said Friday that the JEA “Incremental Economic Development Program” includes manufacturers ranging from small to large industrial, while it appears the transition report is focused on the large industrial manufacturers, which are greatly represented in the “interruptible” class of JEA customers.
She said an “Incremental Economic Development Program” will be effective Oct. 1 for the JEA “interruptible” class of customers. It provides for lower electricity charges for incremental consumption above baseline amounts.
As for the public service tax, Boyce said the collection for the City of Jacksonville via JEA bills was $80 million in fiscal 2010.
For the “interruptible” class of customers, about $2.5 million of the annual City public service tax is collected on their electric bills, composed of about $2 million from base charges and about $500,000 from the applicable amount of fuel charges.
The committee outlined the organizations or agencies that will coordinate changes.
It listed the Jacksonville Regional Chamber of Commerce Cornerstone Regional Development Partnership, now called the JAXUSA Partnership for Regional Economic Development; the Jacksonville Economic Development Commission; the City; and JEA.
Brown has appointed chamber Executive Vice President Jerry Mallot and Jacksonville Civic Council Executive Director Don Shea to review the City’s economic development strategy, including the JEDC.
Mallot served on the economic development transition committee and Shea is the transition staff director.
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