Focused primarily on affecting state and local economic development issues for the membership, FLDC also monitors and provides input, where necessary, on military and veteran issues that affect the overall environment in the state. Progress in all these areas combine to enhance Florida's stature as the preeminent state in which defense contractors choose to conduct and expand their businesses.Hardcopy of Proposals
1. Modernize and reform the QDSC
The Qualified Defense and Space Contractor Tax Refund (QDSC) generally provides a qualified defense contractor a tax refund based on the number of net new jobs it creates in Florida. Then-Governor Chiles established it in 1993 to buffer Florida defense contractors against impending federal defense budget cuts as a result of the Cold War drawdown.
The application and compliance requirements of the QDSC are restrictive and complex and do not encourage the necessary economic growth needed in modern times. FLDC advocates modernizing and simplifying the QDSC to better reflect the defense contractor business industry of today and to make it more accessible to small, medium, and large defense contractors.
FLDC recommends:
Corporate income tax exemption based on a percentage of a business’ annual defense revenue (except for that revenue that is in turn paid out for subcontract work).
• 100% exemption on first $500K in defense revenue
• 50% exemption for between 500K and $1M in defense revenue
• 25% exemption for between $1M and $5M in defense revenue
Corporate income tax exemption based on current or newly created defense related work hours in Florida.
• $0.20 per defense work hour current work ($408 for 2040 hrs)
• $0.40 per defense work hour new work ($816 for 2040 hrs)
• Both up to 204,000 defense work hours (equivalent to 100 employees)
Corporate income tax exemption for using Florida based suppliers, vendors, and subcontractors.
• $2000 for every $1 million subcontracted within Florida (capped at $500,000 per company)
Definition of Florida defense contractor for the purpose of QDSC and/or other programs/incentives: Florida business that is a prime contractor or subcontractor for federal national defense contracts (to include DOD, some DHS, and other federal agency contracts related to national security or space).
2. Support and enhance state defense grants programs
The Defense Reinvestment (DRG), Defense Infrastructure (DIG), and Military Base Protection (MBP) grants provide funds directly to military bases' host communities to promote good relations and projects that help improve the bases' military value. Funds are typically used for:
• Protection against over-development (encroachment) adjacent to or near installation property which jeopardizes the military mission through land or easement purchases.
• Military Community Sustainment Activities.
• Military Family Support.
Military bases are vital to the economic health of the host communities and the state, serving as economic anchors for many Florida communities and defense contractors. FLDC firmly believes that support for defense contractors begins with supporting the military bases and missions within the state and protecting them against closure or realignment.
FLDC recommends:
• DRG: $ 2m
• DIG: $5m
• MBP: $500k (generally to support the operations and administration of the Florida Defense Support Task Force)
3. Support and enhance Florida Defense Support Task Force
Created this year (2011) and funded with $5 million, the FDSTF is charged with bolstering the state's defense economy and military bases.
FLDC recommends:
• Maintain or increase $5 million funding
• Increase administrative resources to $500k or allow other funds to supplement
We need membership support to advance these industry priorities in Florida. Find out how to Join FLDC.
