A seven-year tax incentive package helped lure the company to Oldsmar, but the city says it won't make this year's $11,250 payment.
By AARON SHAROCKMAN
Published November 18, 2003
OLDSMAR - The ribbons are in the trash, the scissors are collecting dust and the city already is pinching pennies over its newest corporate citizen and its $80-million digs.
A seven-year, $1.8-million tax incentive package that helped lure Nielsen Media Research to Oldsmar could be in jeopardy because the city says it won't make this year's payment.
County Commissioner Bob Stewart said most cities would be mailing the $11,250 check without a second thought.
But not Oldsmar.
"If the city doesn't understand the tremendous benefits of having Nielsen in their community, I don't know what to say. I'm surprised and disappointed to start," Stewart said. "You would hope you'd start off your relationship in a very positive, contributing way. Not like this."
The incentive package called for Nielsen to collect $1.8-million in refunds on various state and local taxes over seven years. In exchange, the company would create 600 new jobs over the same period - jobs in addition to those of the 920 workers being relocated to the new Oldsmar facility from Nielsen's offices in Dunedin and other Pinellas locations.
The city was supposed to pay 10 percent of the incentive package. The county would match the contribution, and the state would kick in the rest.
Under the tax incentive plan, the amount that Nielsen will receive each year will vary for a total of $1.8-million over seven years.
But in September, Assistant City Manager Marnie Burns told state officials that Oldsmar will not pay $11,250 in scheduled tax refunds because Nielsen had no employees at the new Oldsmar operations center by January 2003, an agreed upon deadline, Burns said.
"The building wasn't occupied until this fall," Burns said. "The city's position is that this payment is a little premature."
County and state officials said the jobs are coming to Oldsmar, and the city should pay up. The $11,250 is just a portion of the city's tax take from Nielsen, they said.
The City Council will consider the issue at its regular meeting at 7 p.m. tonight. Mayor Jerry Beverland said the money is "small potatoes" compared with the long-term benefits the city could enjoy. He hasn't decided whether he'll agree with the city staff's interpretation.
Either way, Beverland said, the council should have been involved before Burns told the state that Oldsmar wouldn't pay.
"I would have liked to have the council discuss this first," Beverland said. "If you take $11,000 and compare it against $80-million they invested here, what kind of percentages are we talking about?"
If the city does not pay its 10 percent of the total $112,500 first-year payout, as much as 50 percent of county and state matching funds could also be withheld, said Pinellas County economic development director Richard "Buzz" David.
David sees the city's portion as a "small investment in achieving a substantial economic impact." Last month, he wrote a letter to City Manager Bruce Haddock requesting that the city reconsider its position.
"I don't want to do anything that jeopardizes the overall agreement," David said Monday. "But hopefully, that's not going to happen. I think this is just some concern over the partial payment for the first year."
Executives at Nielsen were not available for comment Monday.
The state hopes Oldsmar agrees to pay its portion of the tax rebates by the end of this month, said Alia Faraj, a spokeswoman for Gov. Jeb Bush. All sides are working toward an accord, she said.
Stewart said he hopes the resolution includes an $11,250 check from the city.
"How many cities would love to be in the place Oldsmar is right now?" Stewart asked. "They'd be jumping all over themselves to support this company, not fight over a few thousand dollars."
