Orlando Sentinel
Sat Jan 14 2012 7:01 PM
Walt Disney World and International Speedway Corp. are lobbying Florida lawmakers for a package of tax breaks that could save the two companies millions of dollars in state taxes during the next 20 years.
The first draft of the proposal — written by lobbyists for the two Central Florida businesses — was so broad and contained such a generous assortment of tax breaks that legislative analysts estimated it would cost the state at least $20 million a year and potentially much more.
Lobbying by the giant theme-park operator and the owner of NASCAR racetracks comes as the Legislature, which convened last week for its 2012 session, tries to close a budget gap of as much as $2 billion. It is the fifth consecutive year in which the state has faced a shortfall.
Representatives for Disney and ISC called the proposal an economic-development tool that would give them and other companies added incentive to build sports-tourism facilities, which ultimately could draw more visitors to Florida. Both companies noted that the legislation they have written obligates them to spend millions of dollars on construction before they realize any tax savings.
Disney said the incentives would help revive plans for a 100-lane bowling stadium on its property that were first announced nearly four years ago but which stalled when the developer was unable to obtain financing. ISC said incentives would both motivate it to spend more money upgrading its two Florida racetracks and help resurrect plans for a 71-acre entertainment complex next to its Daytona International Speedway that have languished since the real-estate collapse.
Disney spokesman Bryan Malenius called the proposal "an opportunity to draw millions of new families to the state, diversify its economy and fuel job creation."
But critics say Florida should not have to subsidize the Walt Disney Co., which earned a company-record profit of $4.8 billion during its most recent fiscal year, or ISC, which turned a profit of $54.5 million during its last reported fiscal year.
"These are large corporations who make a lot of money. I think they can invest themselves if they want to," said Senate Minority Leader Nan Rich, D-Weston.
The plan hatched by Disney and ISC calls for the creation of as many as five "Sports Tourism Economic Development Zones" across the state. To qualify, a zone would have to cover from 100 acres to 5 square miles; include a facility home to a major professional-sports team, a baseball spring-training stadium or a motorsports complex; and have hosted at least 15 professional or amateur events and drawn a minimum of 100,000 visitors within the past calendar year.
Businesses within a proposed sports zone would also have to agree to make capital investments totaling at least $20 million during 10 years.
It's unclear how many venues across the state would meet those criteria and attempt to qualify as sports zones. But there are at least three: Disney World's ESPN Wide World of Sports Complex and ISC's Daytona International Speedway in Daytona Beach and its Homestead-Miami Speedway in South Florida.
Once a designation is approved, any business that spends at least $10 million to build, renovate or expand a sports facility within the zone — and a facility would include any "ancillary" venues, such as retail, dining or entertainment businesses — would be eligible for several tax breaks.
They would not have to pay sales taxes on building materials used in the construction. They would not have to pay sales taxes on new business equipment — such as electronics or appliances — that cost more than $5,000 to purchase. And they would get credits, to offset either corporate income or sales taxes, based on the property taxes they pay, both for land and buildings and tangible personal property.
The first version of the legislation that Disney and ISC provided to legislative staff also included a sales-tax exemption on any electricity used in the sports facilities. Legislative analysts who were asked to study the proposal predicted it would cost at least $20 million a year but potentially much more; one staffer estimated the annual loss of tax revenue could "easily" exceed $100 million.
Disney said last week that it has submitted a revised version that no longer includes the electricity-tax break, among other changes, in an effort to help shrink the price tag.
Neither Disney nor ISC would discuss how much they might save individually. ISC Chief Financial Officer Dan Houser said "the better way to look at this" is as a tax-revenue generator, because it would create added incentive to build things that may not otherwise be built, such as ISC's planned entertainment complex in Daytona Beach.
"Without the incentive, such a project would not be feasible for us," Houser said.
Lobbyists for the two companies recently approached Rep. Dorothy Hukill, R-Port Orange, about sponsoring the legislation. Hukill represents a district near Daytona International Speedway and chairs the House Economic Affairs Committee, which evaluates many economic-development incentives.
They have also floated it with House Speaker Dean Cannon, R-Winter Park. Cannon said Friday that, though he hasn't seen specific details, "the concept sounds consistent with what I would like to see, which is anything we can do to promote tourism and protect tourism."
No lawmaker filed the proposal as a stand-alone bill before the start of the Legislature's annual 60-day session, which began Tuesday. Hukill said she may instead try to have a committee introduce it midsession or add the language to an unrelated piece of legislation at a later date, a tactic sometimes used to reduce public scrutiny
The proposal calls for each designated sports zone to expire after 10 years. But any zone could be renewed for another 10 years if it created at least 1,000 jobs or if a minimum of 1.5 million visitors, at least half of whom came from outside Florida, attended sporting events within the zone during the first 10 years.
That should be an easy bar for Disney and ISC to clear. Disney says its Wide World of Sports Complex already draws nearly 2 million people a year. ISC says Daytona International Speedway hosts about a dozen major races annually, and the largest, the Daytona 500, drew about 182,000 people last year
Sat Jan 14 2012 7:01 PM
Walt Disney World and International Speedway Corp. are lobbying Florida lawmakers for a package of tax breaks that could save the two companies millions of dollars in state taxes during the next 20 years.
The first draft of the proposal — written by lobbyists for the two Central Florida businesses — was so broad and contained such a generous assortment of tax breaks that legislative analysts estimated it would cost the state at least $20 million a year and potentially much more.
Lobbying by the giant theme-park operator and the owner of NASCAR racetracks comes as the Legislature, which convened last week for its 2012 session, tries to close a budget gap of as much as $2 billion. It is the fifth consecutive year in which the state has faced a shortfall.
Representatives for Disney and ISC called the proposal an economic-development tool that would give them and other companies added incentive to build sports-tourism facilities, which ultimately could draw more visitors to Florida. Both companies noted that the legislation they have written obligates them to spend millions of dollars on construction before they realize any tax savings.
Disney said the incentives would help revive plans for a 100-lane bowling stadium on its property that were first announced nearly four years ago but which stalled when the developer was unable to obtain financing. ISC said incentives would both motivate it to spend more money upgrading its two Florida racetracks and help resurrect plans for a 71-acre entertainment complex next to its Daytona International Speedway that have languished since the real-estate collapse.
Disney spokesman Bryan Malenius called the proposal "an opportunity to draw millions of new families to the state, diversify its economy and fuel job creation."
But critics say Florida should not have to subsidize the Walt Disney Co., which earned a company-record profit of $4.8 billion during its most recent fiscal year, or ISC, which turned a profit of $54.5 million during its last reported fiscal year.
"These are large corporations who make a lot of money. I think they can invest themselves if they want to," said Senate Minority Leader Nan Rich, D-Weston.
The plan hatched by Disney and ISC calls for the creation of as many as five "Sports Tourism Economic Development Zones" across the state. To qualify, a zone would have to cover from 100 acres to 5 square miles; include a facility home to a major professional-sports team, a baseball spring-training stadium or a motorsports complex; and have hosted at least 15 professional or amateur events and drawn a minimum of 100,000 visitors within the past calendar year.
Businesses within a proposed sports zone would also have to agree to make capital investments totaling at least $20 million during 10 years.
It's unclear how many venues across the state would meet those criteria and attempt to qualify as sports zones. But there are at least three: Disney World's ESPN Wide World of Sports Complex and ISC's Daytona International Speedway in Daytona Beach and its Homestead-Miami Speedway in South Florida.
Once a designation is approved, any business that spends at least $10 million to build, renovate or expand a sports facility within the zone — and a facility would include any "ancillary" venues, such as retail, dining or entertainment businesses — would be eligible for several tax breaks.
They would not have to pay sales taxes on building materials used in the construction. They would not have to pay sales taxes on new business equipment — such as electronics or appliances — that cost more than $5,000 to purchase. And they would get credits, to offset either corporate income or sales taxes, based on the property taxes they pay, both for land and buildings and tangible personal property.
The first version of the legislation that Disney and ISC provided to legislative staff also included a sales-tax exemption on any electricity used in the sports facilities. Legislative analysts who were asked to study the proposal predicted it would cost at least $20 million a year but potentially much more; one staffer estimated the annual loss of tax revenue could "easily" exceed $100 million.
Disney said last week that it has submitted a revised version that no longer includes the electricity-tax break, among other changes, in an effort to help shrink the price tag.
Neither Disney nor ISC would discuss how much they might save individually. ISC Chief Financial Officer Dan Houser said "the better way to look at this" is as a tax-revenue generator, because it would create added incentive to build things that may not otherwise be built, such as ISC's planned entertainment complex in Daytona Beach.
"Without the incentive, such a project would not be feasible for us," Houser said.
Lobbyists for the two companies recently approached Rep. Dorothy Hukill, R-Port Orange, about sponsoring the legislation. Hukill represents a district near Daytona International Speedway and chairs the House Economic Affairs Committee, which evaluates many economic-development incentives.
They have also floated it with House Speaker Dean Cannon, R-Winter Park. Cannon said Friday that, though he hasn't seen specific details, "the concept sounds consistent with what I would like to see, which is anything we can do to promote tourism and protect tourism."
No lawmaker filed the proposal as a stand-alone bill before the start of the Legislature's annual 60-day session, which began Tuesday. Hukill said she may instead try to have a committee introduce it midsession or add the language to an unrelated piece of legislation at a later date, a tactic sometimes used to reduce public scrutiny
The proposal calls for each designated sports zone to expire after 10 years. But any zone could be renewed for another 10 years if it created at least 1,000 jobs or if a minimum of 1.5 million visitors, at least half of whom came from outside Florida, attended sporting events within the zone during the first 10 years.
That should be an easy bar for Disney and ISC to clear. Disney says its Wide World of Sports Complex already draws nearly 2 million people a year. ISC says Daytona International Speedway hosts about a dozen major races annually, and the largest, the Daytona 500, drew about 182,000 people last year
