Soaring off to greener skies?

A Clearwater air time-share firm says without tax breaks, it will leave.

Published May 1, 2007

TALLAHASSEE - The head of an aircraft company based in Clearwater says he is ready to relocate the company's headquarters to South Carolina unless legislators approve a special tax break in the waning days of the session.

Steve Santo, chief executive of Avantair Inc., an aircraft time-share company that moved to St. Petersburg-Clearwater airport a year ago, has been seeking sales tax exemption for his company's aircraft purchases and parts and labor.

"Without this exemption, we will be forced to relocate to a more tax-friendly state, taking with us the tax revenue and high-wage jobs from the Tampa Bay region, " Santo wrote in an April 26 letter to Senate President Ken Pruitt.

Bills authorizing the tax break are stalled in committee, with legislative analysts divided over whether the measure would significantly impact the state's budget.

"This is the most frustrating thing I've ever dealt with, " said Avantair lobbyist Jim Smith of Smith & Ballard.

Early analyses said the state could lose from $1.3-million to $103.7-million on the deal. But according to the most recent legislative study, the proposed tax break wouldn't cost the state anything. That's because Avantair currently stores newly purchased planes out of state for six months after purchase to take advantage of an existing sales tax exemption. But Santo said moving the planes is costly and unnecessary, especially if the company can go elsewhere and get an exemption.

Pruitt said Monday he hadn't seen Santo's letter. But with property tax reform the biggest issue facing lawmakers this session, Pruitt said only two tax exemptions are making their way through the process this year: school supplies and hurricane supplies.

Avantair employs 153 Floridians making an average salary of $52, 600, according to Santo and executive vice president Kevin McKamey. The business plans to expand its facility, adding eight employees a month for the next three years while upping its fleet from 32 to 75 through 2010.

Avantair sells shares in the six-passenger turboprop Piaggio Avanti aircraft to businesses and wealthy individuals who want to avoid flying commercial airlines. Customers buy shares that give them from 50 to 500 hours of flying a year, crews and maintenance included.

Kevin McKamey, Avantair executive vice president, said Florida seemed a promising location for the company's headquarters largely because of an unemployed labor force with aircraft experience. The company still gets hundreds of resumes a week.

A bill passed last year granted a sales tax exemption to DayJet, an air taxi service. The measure, however, does not apply to Avantair because of its aircraft's size. Santo said he didn't know until after the company relocated that it was excluded from the tax break, worth up to $1-million a year.

If the company leaves, Santo said, the state could lose more in terms in business and property taxes than it would by issuing a tax exemption.

McKamey wouldn't say how soon the company's relocation might take place if there is no movement on the legislation (HB 445 and SB 286), sponsored by Sen. Mike Fasano, R-New Port Richey, and Rep. Thad Altman, R-Melbourne.

"It would have to be very quick, " he said.