The Trade Show, Vol. 5
A helping hand...for sports billionaires.
This is Seeking Rents, a newsletter devoted to producing original journalism — and lifting up the journalism of others — that examines the many ways that businesses influence public policy across Florida, written by Jason Garcia.
For years, Florida has had tax breaks on the books for tickets to a handful of marquee professional sporting events: the National Football League’s Super Bowl and Pro Bowl, and the annual all-star games for Major League Baseball, the National Basketball Association, the National Hockey League and Major League Soccer.
These tax breaks are, to use a technical term, dumb. They are public subsidies for a handful of monopoly industries run by a cartel of billionaire team owners who – if they really cared about helping their fans save a bit of money – could lower ticket prices themselves.
But at least there is a (flimsy) logic to them. The Super Bowl and all-star games are annual events that select different host cities ever year – so the leagues, and the tourism companies that make money off travelers attending the games, convince state lawmakers that they must pass these tax breaks or risk becoming “uncompetitive” with other states.
Which brings us to the latest evolution in sports billionaire giveaways: A tax break on tickets to Formula One Grand Prix races, which is tucked deep inside a mammoth package of tax cuts moving through the Florida House of Representatives.
This comes from Steve Ross, the billionaire owner of the Miami Dolphins and Hard Rock Stadium, which recently signed a deal with Formula One to host an annual Grand Prix race for the next 10 years. Lobbyists for Ross are making all the same arguments that we heard for Super Bowls and all-star games: These races are enormous drivers of economic activity, and the tax break will help incentive Formula One to keep it in Miami.
Except....Formula One is already here. And it will be for the next 10 years. They literally signed a contract. This isn’t a Super Bowl picking between Miami or Los Angeles or New Orleans. This tax break wouldn’t incentivize a thing. (Ross’ lobbyists claim Formula One might cancel the contract early without this tax break...even though they signed the contract in the first place without it.)
And because this Formula One race is an annual event – with ticket prices ranging from $640 to $2,070 each – the cost of this is orders of magnitude higher than it is for Super Bowls or MLB home-run derbies. Economists predict that eliminating the sales tax on Formula One Grand Prix tickets will cost $6 million a year. That’s $30 million over the next five years.
With potential tax savings like that on the table, it might make more sense why one of Ross’ companies, South Florida Stadium LLC, gave $50,000 just before session started to a political committee controlled by Senate President Wilton Simpson and Senate Budget Chair Kelli Stargel.
This is one of those small spending details that says a lot about the priorities in Tallahassee. Because this tax break would be permanent, while all the tax breaks in the House tax package that really would help everyday Floridians – sales-tax exemptions for children’s diapers, baby and toddler clothes, children’s books, for instance – are temporary. None of those tax breaks would last for more than a year.
Florida could get rid of sales tax on children’s books forever, and it probably wouldn’t cost a whole heckuva lot more than this Formula One tax break.
But, instead, the Florida Legislature is already doubling down in the other direction. Earlier this week, the House added to its tax package a permanent tax break on tickets to World Cup and World Cup qualifying matches (Do we really want to reward FIFA…?)
And lurking behind the curtain in all this is the 800-pound gorilla of professional racing in Florida: NASCAR and the France family.
A proposal has already been drafted in the Florida Senate that would expand this tax break to tickets to the Daytona 500. It feels like a near-certainty that this will surface in an amendment sometime over the final two weeks of session.
Because obviously we can’t risk the Daytona International Speedway picking up and moving to Atlanta.
‘The not-so-sunny side of Florida’s economy’
Speaking of dumb ideas (that, folks, is an all-timer of a transition), Orlando Sentinel columnist Scott Maxwell singles out what he thinks is a big one:
Some Florida politicians really seem to want to keep people poor.
I didn’t always believe that. I used to think they were just indifferent to the working poor. But we have evidence lawmakers want to keep them that way.
A bill advancing in the Legislature would ban cities and counties from choosing to hire only contractors that pay living wages.
If you found that last sentence confusing, that’s probably because you have a brain.
After all, we’re not talking about local municipalities passing citywide minimum-wage laws. We’re just talking about cities choosing how they want to spend their money.
The first preemption bill of 2023
One of the living-wage ordinances that would be wiped out by that legislation is in Miami-Dade County. That’s also where, as Douglas Hanks and Omar Rodríguez Ortiz of the Miami Herald report, local leaders are working on a law giving tenants more protections from landlords who jack up rents with little warning:
The housing crisis arrived at Yudet Pérez’s door in the form of a notice announcing a 55% rent spike at her unit in a Hialeah apartment complex weeks after the building was sold to a new owner.
Her family had less than a month to brace for an extra $600 due every month for their two-bedroom unit — now the subject of an eviction notice that has Pérez trying to find an affordable home in a market where rents are rising at one of the fastest rates in the country.
“I cried a lot this morning,” the 46-year-old cosmetologist, who came to the United States from Cuba, said in Spanish during an interview last week.
While Florida and local laws mostly give landlords latitude on increasing rents once a lease expires, there’s a push in Miami-Dade County to impose some new rules on the timing of those hikes.
A proposed countywide ordinance would require 60 days notice before a landlord could increase rent by more than 5% at the end of a lease, or for tenants without fixed leases. The legislation by Commissioner Eileen Higgins follows the lead of Miami Beach, which imposed a similar rule within city limits earlier this month, and Hialeah, which on Tuesday advanced legislation to impose its own notice requirement for notable rent increases.
Could the Legislature cut affordable housing again?
One of the most baffling budget choices so far this session is the Florida House’s decision to divert more money from the state’s affordable housing program – one year after permanently cutting the program in order to fund projects preserving water resources and protecting against rising seas. (If only there were another way to pay for some critical needs without cutting money for other critical needs.)
It's possible they’re just holding back so they can come through with the money at the last-minute – and generate a bunch of positive, affordable housing-focused headlines at the end of session.
Whatever the motive, Phil Prazan at NBC 6 in Miami takes a deep dive into the issue:
South Florida has become unaffordable for many as rent prices go up 30% in some communities.
It comes down to supply and demand. There’s not enough supply of affordable apartments and homes at a time when new people are rushing to move to South Florida.
Advocates told NBC 6 thousands of units in the past two decades could have been built if state lawmakers did not divert billions meant for affordable housing projects.
This isn’t going to be pretty
If you’re one of the nearly 1 million Floridians covered by Citizens Property Insurance Corp....I fear this session is going to end badly for you.
From Catie Wegman of Treasure Coast Newspapers:
Thomas and Eileen Schoenberg had to get a new homeowners insurance policy when purchasing their St. Lucie County condominium in December 2019.
Capital Insurance Agency, Inc., had offered them a yearly rate around $1,100, Thomas Schoenberg said. But despite installing a new roof and hurricane-proof windows, the company raised the Schoenberg's policy to $2,600 the next year — a 136% increase.
The couple successfully found a cheaper alternative, a roughly $1,700 annual policy with Florida Peninsula Insurance Co., Schoenberg said, but faced a similar fate going into 2022: another price hike, this time reaching $3,000 a year.
Neither insurance company justified the increase, he added.
"We’re powerless. Insurance companies won’t even talk to you. They do what they want to do," said Schoenberg, 71, who has lived in St. Lucie County for about 18 years. "It’s criminal. It’s absolutely criminal that we let them get away with this."
While you’re here, also read Jim Saunders of the indispensable News Service of Florida:
Another scandal that’s nowhere close to done
In case you were wondering if the scandal around the attempted multibillion-dollar privatization of Jacksonville’s city-owned electric utility company is over...it is not.
From Florida Times-Union columnist Nate Monroe:
A recent audit by the Jacksonville Office of Inspector General found ousted JEA CEO Aaron Zahn and the former crop of executives around him charged more than $128,000 to utility credit cards for sometimes lavish business expenses that either violated the agency's spending rules or lacked proper documentation to justify them.
In total, interim Inspector General Sheryl Goodman said 506 of the 945 business credit-card transactions her office reviewed — 55 percent — "did not comply with JEA policies and procedures." In addition, the audit said Zahn and others were reimbursed for improper expenses, like more $4,000 for a 2-day, 3-night trip for an executive retreat to Charleston, and hundreds of dollars for alcoholic drinks purchased during lunch at a Jacksonville Beach restaurant.
The improper expenses included thousands spent for off-site executive meetings at the Jacksonville Zoo & Gardens, an unnamed local wildlife refuge center (which public records indicate to have been White Oak Conservation Center in Yulee), a "local family entertainment facility" — which offered laser tag and bowling — and the Ponte Vedra Inn & Club.
In one case, Zahn spent more than $1,000 to reserve an "escape room" — an entertainment venue where teammates work to solve elaborately planned puzzles — for a "future of JEA workshop," an event that never took place. The money was non-refundable.
An ideology of geography
Lastly, I usually don’t care too much for ‘But hypocrisy!’ dunks on politicians supporting a particular policy or another (he wrote, knowing full well he’s done the same kind of dunking on Twitter in the past).
The truth is, most issues are complex and multi-faceted and require balancing competing values. Hypocrisy arguments are too often just intellectually lazy whatabout-isms designed to avoid addressing the actual substance of an issue.
With that sanctimony out of the way...LOL:
Republicans in Alachua County, where Democrats have a big countywide majority, are pushing for a referendum that would give voters the option of changing county commission elections from county-wide seats to single-member districts.
At the same time, Republicans in GOP-heavy Sarasota County are asking voters to switch from single-member commission districts to countywide seats – two years after voters already approved a referendum calling for single-member districts.
First, from John Henderson of the Gainesville Sun:
A bill that would give voters in November the option to redraw how Alachua County commissioners are elected passed a final legislative committee in Tallahassee on Monday.
House Bill 1493 was approved by the State Affairs Committee — the final committee stop — after legislators heard from Alachua County officials and residents who had traveled to Tallahassee to oppose it.
The next stop is the full House.
Both Clemons and the bill's detractors, which include the Alachua County legislative delegation, say they believe it is inevitable that the bill will now pass.
The move follows efforts by some in rural western Alachua County, supported by Clemons, to break off and form a separate Springs County — a movement that has fizzled. While much of Alachua County, especially Gainesville, tends to vote Democratic, Republicans dominate to the west, and some feel their votes are diluted in at-large voting.
And then from Anne Snabes of the Sarasota Herald-Tribune:
A Tallahassee-based organization with connections to one of Florida's top political consulting firms is running an expensive campaign to overturn single-member districts in Sarasota County.
But it's not clear who's behind this campaign.
The organization, known as Sun Coast Alliance, appears to be able to obscure the names of its donors.
Sarasota County commissioners voted in December to hold a referendum on single-districts on March 8. Commissioners want the county to switch from single-member districts – a system where commissioners are elected solely by the citizens of the district in which they live approved by the public in 2018 – to a countywide voting system.
Ahead of the referendum, a well-organized campaign opposing single-member districts emerged quickly. Residents started receiving flyers in their mailboxes telling them "RIGHT NOW, SARASOTA COUNTY COMMISSIONERS ONLY ANSWER TO A SMALL GROUP OF VOTERS," and "On MARCH 8TH Sarasota County Voters will make important decisions about our future."
Sun Coast Alliance, a political action committee based in Tallahassee, is running this campaign. The PAC's chairperson is William "Stafford" Jones, a political consultant with close ties to an influential Republican consulting group named Data Targeting Inc.