Florida’s Governor Says He’s Coming To Connecticut To Recruit Companies [Courant]

June 24, 2015

Hartford Courant

HARTFORD — Florida’s governor is coming to Connecticut in an attempt to poach companies, and on Monday state businesses repeated their call to the state legislature to ease taxes.

Florida released a radio advertisement Monday that was broadcast on WTIC-AM: “Connecticut recently increased taxes, again, this time by over $1 billion.

“Florida has no state income tax, and has cut taxes more than 40 times over the last four years. Unlike Connecticut, Florida is a right-to-work state, with no estate or gift tax. If you’re a business that wants to pay less taxes so you can earn more money, come to Florida. Florida Governor Rick Scott is coming to Connecticut to share the Florida story of low taxes and more jobs.”

Scott’s office in Florida provided no details about his travel schedule or the companies that he might visit. “We will let you know when there are more details to announce,” said Jeri Bustamante, a spokesman for Scott, a Republican.

Devon Puglia, a spokesman for Malloy, dismissed Scott’s visit: “These stunts are unfortunate, but we know each and every day we’re making progress. Just look at the 6,400 jobs we created last month as the labor market is the highest it has been since the ’70s. Connecticut is no doubt moving forward.”

Coincidentally with the Florida ad broadcast, the 10,000-member Connecticut Business and Industry Association and the Connecticut Retail Merchants Association and others called a press conference Monday at which they said that the legislature should approve Gov. Dannel P. Malloy’s tax rollback proposal and further cut taxes and spending.

Malloy and the Democratic-controlled legislature crafted a two-year, $40 billion budget in the recently concluded legislative session that increased business taxes.

In reaction, Connecticut-based corporations such as General Electric, Aetna and Travelers issued statements sharply criticizing the increases. The state’s tax decisions were also mentioned on national television by Joe Scarborough on MSNBC’s “Morning Joe” program and in an editorial in The Wall Street Journal.

Since then, Malloy has released a rollback plan that would keep the sales tax on computer and data processing services at 1 percent, rather than the original plan to triple it to 3 percent. His plan would also postpone a controversial unitary tax, which would lead to higher taxes for GE and other multistate corporations, until 2016.

The legislature is expected to convene a special session on June 29 and 30, but no final agreements have been made yet with Malloy. The House Democrats will caucus Tuesday to discuss the issue.

House Speaker J. Brendan Sharkey, a Hamden Democrat, said he expected to listen to ideas from legislators Tuesday. “We need to know a little more specifics about what are the issues that these individual companies may have with what’s being proposed so that we can respond to them, as opposed to being a blanket, ‘Boy, we don’t like this,’” Sharkey said. “We’ll try to reach a consensus as quickly as possible toward what the package should look like.”

Florida’s Enticements

Joseph Brennan, chief executive of the CBIA, acknowledged Florida’s radio ad, but said he didn’t know which companies Scott might visit.

“I don’t know what his marketing is on these meetings,” Brennan said. “I just know that we’re fighting to keep our companies here in Connecticut, and we’re going to continue to do that.

“The threats are real. Governors are calling companies in the state of Connecticut. Some governors are coming to the state of Connecticut, trying to entice our companies to relocate.”

Timothy Phelan, president of the retail merchants association, said Monday that Scott’s visit was not a good sign. “It’s not good when other governors say: ‘Let’s go raid Connecticut.’”

Phelan said he supports Malloy’s reduction plan “at a minimum” and “would love to see the legislature open up the whole tax package.”

“The retailers would also love to see the legislature look at the clothing exemption allowance and give consumers a break,” Phelan said. “Consumers are going to take a big hit on that. Our surrounding states don’t have that clothing exemption.”

Under the state budget, consumers would pay the 6.35 percent sales tax on clothing, shoes and sneakers costing less than $50 per item. The tax would cost consumers about $136 million in the next fiscal year.

The National Federation of Independent Business, which lobbies at the Capitol, said that the budget would directly affect small businesses.

“Despite an unprecedented response from employers of many sizes, continuous disappointing economic ratings nationally and an outcry from the general public, both the governor and legislature are pushing forward to afflict Connecticut with a budget chock full of burdensome tax hikes and questionable accounting,” said Andrew Markowski, the federation’s state director. “We stand today with members of the business community imploring the legislature to heed our warning that as it stands, this budget deal will no doubt drive small businesses, and the jobs that they create, out of Connecticut.”

Deputy Senate Republican leader Kevin Witkos of Canton said that the companies are not bluffing when they talk about possible relocation.

“This is for real,” Witkos said. “This is no joke.”