A tax abatement program approved by Sanford voters in March is already producing the intended results.
Sanford City Commissioners on Monday night approved the first of three public hearings which would reduce property taxes by 50 percent over the next 10 years for Allegiant Airlines' new $24.7 million training center.
The total dollar amount of the tax break is still being calculated by the Seminole County Property Appraiser's Office.
"We're in the beginning stages of assessing the taxable value of the project and projecting, as best we can, a 10-year forecast," said Appraisal Director Sally Seibenberger.
The training center would be located south of Lake Golden and immediately west of Red Cleveland Boulevard, the main entrance to Orlando Sanford International Airport. That land currently is valued by the property appraiser's office at $2.2 million, and was assessed $45,719 in taxes in 2015.
"Even with a 50 percent discount, the city will collect tens of thousands of dollars more money," said Sanford Mayor Jeff Triplett. "That's not calculating the money the pilots and crew members will spend locally while they are staying in Sanford."
The center will produce about a dozen jobs paying an average of $100,000 a year (239 percent of the private sector wage in Seminole County), bring several hundred pilots and crew members to Sanford throughout the year for multi-week training, and is expected to lead to new development of a hotel and restaurants near the airport. Seminole County estimates the new center will have an annual economic impact of $16 million.
"This is exactly why we created the tax abatement program," said Sanford City Commissionr, Art Woodruff, who actively campaigned for the passage of the referendum. "This is the kind of project we were looking for."
Sanford Economic Development Director Bob Turk said Orange County, Ocoee, Maitland, Oviedo, Casselberry and Longwood have similar programs. But Sanford is not just competing with local communities for new business, Turk said. With its own international airport, and hundreds of acres of available commercial land, the city competes nationally.
"We've missed out on opportunities because we had no city-sponsored incentive program in place," said Turk.
Last year, Sanford was one of three cities a software company was considering for relocation of 1,000 new jobs.
"When the company compared incentives from cities in Texas and New York, Sanford had nothing to offer," Turk said.
To be sure, incentives aren't the only factor businesses use in determine where to relocate Turk said. The labor force, education facilities, the cost and availability of the land and buildings, and infrastructure cost are all components of a company's relocation decision matrix. But with no incentives program, cities like Sanford are starting from behind in attracting new businesses.
"The incentive program was very, very helpful to close the deal with Allegiant," said Larry Gouldthorpe, president of Airports Worldwide Inc.
"The airline has a good support system and infrastructure in Sanford, but it was never a foregone conclusion that this training center would be located in Florida," he said.
Cincinnati, Asheville, N.C., and Austin, Texas, were among the cities Allegiant was considering, Gouldthorpe said.
As the Sanford Airport Authority's private sector partner operating the domestic and international terminals, Airports Worldwide is responsible for recruiting airlines and maintaining their presence in Sanford.
Airports Worldwide also owns the land Allegiant will lease for the training center.
Kevin Spolski, whose company Spolski Construction Inc. will be the general contractor for the Allegiant project, said he's been working with Allegiant officials for nearly a year to bring the center to Sanford.
"Allegiant has a good relationship with Sanford, but bottom line, they are very conscious of price," said Spoliski, who noted Allegiant left Sanford's airport for for Orlando International Airport in February 2010, but returned a year later, in part because of the higher operating fees at OIA.
Under the program approved by 68 percent of voters, companies that make a substantial new investment in equipment or new construction and are classified as a targeted industry by Enterprise Florida are eligible for tax abatement.
City commissioners have the prerogative on a project-to-project basis to offer up to 50 percent discount on property taxes for up to 10 years. The commission has the flexibility to approve a tiered discount (50 percent Year 1, 40 percent Year 2, ...), a discount for less than 10 years, or no abatement at all.
Turk said the success of landing the Allegiant training center is already paying dividends for future economic development.
"I've been contacted by another aviation company that is looking to locate near the Allegiant property," Turk said.
Gouldthorpe said he was unaware of companies Turk may be courting, but he is not surprised the private sector is exploring Sanford.
"The training center will be a catalyst project for development all around the airport," Gouldthorpe said. "Add to that the community support Sanford has shown by creating business friendly programs like tax abatements, and I expect you will see lots more of these type of announcements."
Triplett, whose full-time job is in banking, says the abatement program is attracting interest in the business community.
"Some of these companies won't qualify for tax abatement, but they still want to be near a facility like Allegiant's for business reasons," said Triplett. "It's raised our profile, for sure."