Okaloosa County BOCC — August 6, 2013 — Ad Valorem Memo to BCC — reading text

MEMO Date: October 4, 2013 To: John Hofstad, Okaloosa County Interim Administrator From: Nathan Sparks, Executive Director Subject: Economic Development Ad Valorem Tax Exemption This summary was created for the Okaloosa Board of County Commissioners by the Economic Development Council of Okaloosa County regarding the future of the Economic Development Ad Valorem Tax Exemption. The EDC is coming before the Board seeking direction from the Commissioners: o Does the Okaloosa County Board of County Commissioners want to pursue renewing the incentive? o If so, when does the county want to move forward in presenting this to the voters? o See cost analysis from Paul Lux, Okaloosa Supervisor of Election. (Exhibit B) March 2014 Election with Municipalities - $134,264.44 Mail Ballots - $99,100 August 2014 Election (In conjunction with primary election) - Cost of legal advertising (Approximately $2,400) o Does the Board of County Commissioners want the EDC to lead this initiative on behalf of the county? History The Economic Development Ad Valorem Tax Exemption is an incentive program in which Okaloosa County voters authorized the board to grant qualifying businesses an exemption in their county property taxes of up to 100 percent for up to 10 years. This program was initially approved by voters 1981 and renewed in 1992. In September 2002, voters rejected the program. In March 9, 2004 voters approved the revival of the program. Per Section 3, Article VII of the State Constitution: (c)Any county or municipality may, for the purpose of its respective tax levy and subject to the provisions of this subsection and general law, grant community and economic development ad valorem tax exemptions to new businesses and expansions of existing businesses, as defined by general law. Such an exemption may be granted only by ordinance of the county or municipality, and only after the electors of the county or municipality voting on such question in a referendum authorize the county or municipality to adopt such ordinances. An exemption so granted shall apply to improvements to real property made by or for the use of a new business and improvements to real property related to the expansion of an existing business and shall also apply to tangible personal property of such new business and tangible personal property related to the expansion of an existing business. The amount or limits of the amount of such exemption shall be specified by general law. The period of time for which such exemption may be granted to a new business or expansion of an existing business shall be determined by general law. The authority to grant such exemption shall expire ten years from the date of approval by the electors of the county or municipality, and may be renewable by referendum as provided by general law. The authority to grant exemptions is set to expire in March 2014. The authority may be renewed for subsequent 10- year periods if each 10-year renewal is approved in a referendum. Florida Statute 196.1995 has been provided as Exhibit A. Benefits This local incentive would diversify the county’s business base by encouraging industries creating high-wage jobs to either relocate or expand in Okaloosa County. This program allows Okaloosa County to remain competitive in business recruitment. Additionally, existing businesses will be eligible for the exemption for new improvements including qualifying buildings and equipment. No current tax revenues will be lost. Thank you for your consideration for this request and future development! P.O. Box 4097, Fort Walton Beach, FL 32549 - (850)362-6467