THE OFFICE OF ECONOMIC AND SMALL BUSINESS DEVELOPMENT RECOMMENDS APPROVAL OF THE ABOVE MOTION.
Project Ocean is an international headquarters project for a subsidiary of a leading global ocean shipping carrier. The parent company is a conglomerate with diversified holdings and its fleet includes container vessels, tankers, supply ships, special vessels, and oil drilling rigs. The parent company also operates industrial, and supermarket businesses, and operations in oil and gas production. The company is active worldwide and employs over 89,000 people in more than 135 countries. This project would serve as an international headquarters for the parent company’s newly revived subsidiary operation, focusing on Intra-American shipping services. Project Ocean seeks to establish an international headquarters operation in the City of Miramar, Broward County, resulting in the relocation of 15 employees from Miami-Dade County to Broward County, and creation of 65 new employees in Broward County, Florida by 2015. Locations in Texas, Panama, and Brazil are also under consideration.
If Project Ocean chooses to expand operations in Broward County instead of Texas, Panama, or Brazil, company officials propose location in office space in the City of Miramar in Broward County, Florida, with an estimated capital investment is $350,000 and a new job average annual wage of $90,000. The average wage amount exceeds 200% of the County’s average annual wage for new jobs created under the Broward County Direct Cash/Job Creation Incentive Program. This Program is available for companies on a performance-driven basis that create high wage jobs in targeted, high value-added industries.
As an approved participant in the Broward County Direct Cash/Job Creation Incentive Program, Project Ocean will continue to provide a variety of ocean carrier services to meet growing industry demand. Project Ocean falls within one of the targeted industry sectors designated under Florida Statute 288.108, as both a corporate headquarters and a global logistics firm. Project Ocean, as an international corporate headquarters and member of the International Trade and Logistics industry sector will enhance the County’s Targeted Industry strategy. Project Ocean’s business model aligns with the Board of County Commissioner’s vision: Unlimited Economic Opportunities, which support “an economically successful, multi-faceted international community with high paying jobs and a well-educated, skilled, and motivated workforce.”
While the accompanying Tax Revenue/Incentive Pay Out Analysis memorandum and spreadsheet (Exhibit 2) indicates that the anticipated tax revenue generated from the project does not conform to the County’s threshold for positive Net Return, approval is recommended for the following reasons: 1.) the County’s unemployment rate for April 2014 was 5%, the lowest of any urban county in the State of Florida, however, it remains unacceptably high compared to the County’s 2007 pre-recession unemployment rate of 3.4%. Additionally, in April 2014, there were 52,682 persons unemployed in Broward County, compared to the pre-recession level of 34,418 in 2007. This project generates 65 new jobs paying 200% of the County’s average wage; 2.) the proposed project represents a high-profile addition to the critical mass of shipping and trade related firms in Broward County required to fulfill Commission Goal No. 5 under Unlimited Economic Opportunities: “Become Florida's epicenter for world trade; especially with the Caribbean, Asia, South and Central Americas” through attraction of other trade and logistics firms, and through the building of the private sector shipping industry support necessary to promote continued development and growth of Port Everglades, contributing to Broward County’s image as a “Gateway to Latin America and the Caribbean”; 3.) the Miramar City Commission approved the full 20% local financial support for Project Ocean on May 30, 2014 in the amount of $91,000 and; 4.) due to additional indirect economic benefits to the County generated by the creation of 65 new high skill/high wage jobs paying 200% of the County’s average annual wage such as home purchases and local spending. The above stated reasons support the conclusion that the proposed project will make a significant positive contribution to the County’s economy.
The City of Miramar Commission has approved the 20% local financial support required for the State of Florida Qualified Target Industry Incentive (QTI), a Miramar resident Hire Incentive of $500 per Miramar resident hired potentially worth up to $32,000 to the company. All recommended incentives are pay for performance incentives.
Based on creation of 65 high-wage/high-skill jobs and the projected capital investment, the total proposed incentive amount is as follows:
QTI and High Impact Sector Bonus – State of Florida (80%) $364,000
QTI and High Impact Sector Bonus Local Financial Support (20%) – City $91,000
Direct Cash/Job Creation Incentive Grant – City $32,000
Direct Cash/Job Creation Incentive Grant – County $50,000
Total Proposed Incentive Amount $537,000 |