Legislative Update #3

The Legislature is heading into its final weeks of the 2023 Session which is scheduled to end on May 5. All attention has now turned to finalizing the 2023-2024 budget which must be signed into law no later than June 30. In this update, we explore the major affordable housing initiative signed into law by the Governor last month; the potential for an additional cut in the sales tax on commercial rents; Visit Florida/Enterprise Florida attacks, and finally, the state of play on Florida’s 2023-2024 budget.

St. Johns County is not unique in Florida in that we have an affordable housing crisis. In fact, the lack of attainable middle-class housing has become a major impediment to growth for our County’s law enforcement, schools, health care, fire rescue, and aerospace manufacturing employers.  While St. Johns County is moving forward with a proposed workforce housing ordinance at the local level, action taken by the State Legislature last month significantly changes the playing field for the increased production of affordable homes statewide.
 
SB 102, the “Live Local Act” is the first significant overhaul of Florida’s affordable housing laws in decades. Championed by Senate President Kathleen Passidomo and House Speaker Paul Renner, the “Live Local Act” adds over $700 million in state funds toward affordable housing through the expansion of the Hometown Heros down payment assistance program; additional funds for the State Housing Improvement Program (SHIP) and the State Apartment Incentive Loan Program (SAIL); amendments to multiple provisions of Florida Statutes related to the development of affordable housing and economic incentives; tax incentives available to developers who create affordable multi-family housing; and certain restrictions upon local government’s ability to control density, height limits, and rent control for developments that include a minimum of 40% affordable units that will remain affordable for 30 years.

For a good initial analysis of the potential impacts of the Live Local Act program, go to:
https://gunster.com/alerts/live-local-act-cs-sb-102-cs-hb-627/

Legislation was quietly introduced in the House last month that would fundamentally change the way in which the State’s tourism development arm Visit Florida would be funded and would place major costs and restrictions on Florida’s 62 Tourism Development Councils including the St. Johns County Tourism Development Council, the County’s “Bed Tax” funded tourism marketing agency. The SJC Chamber continues to work in concert with the County’s Visitor and Convention Bureau, Attractions Association and Chamber members directly impacted by this legislation to signal our state legislative delegation, including Speaker Paul Renner and Senator Travis Hutson to oppose this attack.  The discussion has now been folded into the 2023-2024 state budget negotiations between the House and Senate and is not anticipated to be resolved until the end of the Session. Leaders of Florida’s statewide tourism industry has roundly criticized the effort to “tax” each county’s tourism development council up to 5% of their “Bed Tax” collections to fund Visit Florida’s marketing efforts statewide. Many members initially supporting this effort have begun expressing “serious reservations” about the bill because of the potential damage it could do to the very successful Florida tourism marketing efforts in recent years.

If you have not already done so, please contact the members of the St. Johns County legislative delegation below and urge them to oppose any effort to kill or defund Visit Florida and our County’s tourism marketing efforts which are so important to the continued growth and prosperity of St. Johns County.

Senator Travis Hutson (R - District 7)
District Office:
(386) 446-7610
Email: Hutson.Travis@FLSenate.gov
 
Rep. Paul Renner (R - District 19)
Speaker of the Florida House of Representatives
District Office:
(386) 446-7644
Email: Paul.Renner@MyFloridaHouse.gov
 
Rep. Cyndi Stevenson (R - District 18)
District Office:
 (904) 823-2300
Email: Cyndi.Stevenson@MyFloridaHouse.gov
 
Rep. Bobby Payne (R- District 20)
District Office: (386) 312-2272
Email: Bobby.Payne@MyFloridaHouse.gov

Legislation is moving forward in the House and Senate to eliminate the State of Florida’s economic development arm Enterprise Florida (“EFI”) and relocate some of its functions to another State agency. EFI provides the vitally important link between companies outside of Florida (and across the world) looking to expand to the state and Florida’s local and regional economic development agencies, including JAXUSA and the St. Johns County Economic Development Department. Without access to these vital market leads, small and mid-market locales like St. Johns County simply will not have access to the valuable intelligence provided by EFI consultants across the world as companies scout for new locations for their business operations. At a minimum, these leads and intelligence functions that EFI provides St. Johns County must be retained if we are to remain competitive with surrounding states for new businesses to relocate here.

Using the contact info above, please contact Speaker Renner, Senator Hutson, Rep. Stevenson, and Rep. Payne to urge them not to eliminate Enterprise Florida’s vital market intelligence functions that are so valuable to mid-market locations such as St. Johns County.

Continuing to streak through this year’s Legislative Session, the Florida House and Senate last Friday agreed to meet this week in conference to iron out differences between their two budget proposals. The Senate has proposed $113.7 billion which is $1 billion less than Governor Ron DeSantis’ proposed budget, while the House bill approves $113 billion, some $2 billion less. Both budgets have raises for state employees, infrastructure, and land acquisition.

Each body’s proposals have differences that they will have to work out before the Session ends on May 5. Among the major differences are: The House proposal does not include funding for Visit Florida while the Senate includes $80 million. The House eliminates Enterprise Florida, the State’s economic development arm, while the Senate and Governor’s budgets are silent. Education funding is another major difference between the two budget proposals as they both differ on how to pay for the newly signed universal school voucher program.  Among the most-expensive proposals in the House package is a reduction in the commercial-lease tax from 5.5 percent to 4.5 percent. That change would cut state revenue by an estimated $311.5 million and local government revenue by $82.9 million. Two years ago, the Legislature directed the commercial-lease tax to be cut to 2 percent when revenue from sales-tax collections on out-of-state retailers replenishes the state’s Unemployment Compensation Trust Fund, which became depleted during the COVID-19 pandemic. A staff analysis of the House bill projected the trust fund would be made full in May 2024 leading up to the commercial-lease tax reduction to 2 percent starting Aug. 1, 2024.

Both the House and Senate propose an additional $2 billion on education which equates to more than a 4% increase per student. The House proposes a plan to pass down money to school districts in a new way, more of a “lump sum approach” while the Senate appears somewhat skeptical and does not appear to support a change in the existing formula. The House plan has an additional $250 million for teachers and school staff raises while the Senate has $200 million.

Governor DeSantis has also included $1.5 Billion in tax cuts, primarily through a series of “tax holidays” on items purchased for hurricane preparation, back-to-school supplies to newly added items such as diapers, personal hygiene products, paper towels, and wipes.  These tax-cut proposals will be folded into the final budget for the State of Florida which must be acted upon before the Legislature adjourns on May 5.

The cut in the sales tax on commercial leases saves businesses dollars off their bottom line every month. Florida is the only state in the US that still charges this tax, and the Chamber has been actively fighting for this reduction and eventual elimination of this business tax for many years.

 
Don’t Forget to Register for the 2023 Legislative Update Breakfast, May 19, 8:30 a.m. - 10:00 a.m., Embassy Suites Resort, St. Augustine Beach, featuring the St. Johns County Legislative Delegation, SJC County Commission Chair Christian Whitehurst, St. Augustine Mayor Nancy Sikes-Kline and St. Augustine Beach Mayor Don Samora.