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AUGUST 2008 8/21/2008

Amendment 5 – Bad Deal for Everyone

Amendment 5 is being proposed by the Florida Taxation and Budget Reform Commission(TBRC), a constitutionally created commission that meets every 20 years to assess thestate’s tax and budget policy. The commission has the power to place amendments onthe ballot without legislative approval. The TBRC has already voted to place Amendment5 on the ballot in November. If it passes, the amendment will be effective in 2010.

Essentially, this amendment calls for the removal of local property taxes used foreducation funding. Amendment 5 will decrease the average property tax bill by about25%. This sounds great, but the state is required to “hold the schools harmless” so thelegislature will be forced to raise an additional $11.4 billion to fill the gap the propertytaxes portion used to pay. This added amount is 20% of the state budget.

Blair Wygle, President

Great Atlantic Outfitters

Government Relations Chairman

Guest Columnist

Facing an $11 billion shortfall the state legislature will be looking for new sources of revenue also known as “fees” or taxes.Amendment 5 isn’t a tax savings but at best a tax swap. Here’s why:

Where will revenue come from if Amendment 5 is approved in November?

1) Sales Tax Increases: The TBRC is proposing a 1% sales tax increase which will generate about $3.3 billion. Don’t forgetthat in Duval County we already pay a sales surtax of 1%. This increase would bring the grand total to 8%! This assumes thatthe state will stop at a 1% increase, which they are not required to do. This is a huge unknown! A sales tax increase of ANY


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amount will be tough for Florida businesses to swallow. It simply negatively affects our ability to compete both domesticallyand globally. This is compounded by internet and out of state competitors who often don’t charge/collect sales tax.

2) Repealing Sales Tax Exemptions: The TBRC has identified $4.1 billion of exemptions for probable repeal. We compete in a global economy so the loss of current exemptions will be devastating. Examples include:

Manufacturing inputs—Manufacturing’s 15 specific sales tax exemptions provide over $330 million in tax reliefResearch and Development Local and state government ($500M) fees will be created to cover losses Metered water ($300M) Car trades—$550M Nonprofits including churches (many will fail) more important the Jacksonville Journey Retirement Communities (up to $350/month per resident)

3) New and increased “fees” (I call them taxes): As with Amendment 1 passed in January, the state reduced local governmentfunding and our local “fees” (taxes) increased! The City of Jacksonville imposed three new fees to make up for the loss ofrevenue from Amendment 1: 3% JEA franchise fee; a garbage fee; and, a storm water fee. Businesses and individuals willlikely see an increase in both the number of new local fees as well as the increase of fees currently in existence.

4) Tax on Services: The reintroduction of a “tax on services” is an unpopular idea but this is a HUGE revenue source. It’spossible that the legislature may not have a choice but to consider this tax. The TBRC chose not to prohibit a “tax on services”in the language of Amendment 5. Additionally, the language of the amendment is very vague, creating much uncertainty as tohow the budget deficit will be filled. Actually, the legislature is not certain about the amount of the state’s shortfall.

What do the educators think? Schools have created a united front against Amendment 5 as have most business groups. Educational funding comes through both state and local sources. The shift to 100% state funding has educators concerned. They are afraid Amendment 5 will turn into another lottery which was disastrous for education. Although the amendment requires the state to replace the lost revenue from property taxes, the state legislature has historically done a poor job of replacing revenue sources that its previously removed.

The increased fees and repeal of exemptions still leaves a $4 billion shortfall: The proposed sales tax increase andexemptions will only make up $7.2 billion of the $11.1 billion shortfall. This leaves us $4 billion short of the goal. You have toask yourself “Where is the money going to come from?” Also don’t forget we are in the middle of a sluggish economy. Staterevenues are currently off by about $8 billion (13%) thus compounding the budget deficit problem.

If we are going to be taxed, it might as well be through property taxes. Why? They are tax deductible. Sales taxes, fees and loss of exemptions are not!

So... Who is for the amendment? The Florida Association of Realtors is the largest (and wealthiest) proponent of Amendment 5. They see this as lowering the cost of owning a home, and thus helping to end the housing slump. Remember, if the amendment passes it will not take effect until 2010. Indicators are that low housing cycle will be substantially recovered by then. There is no need for this amendment. Also, Governor Christ favors the amendment.

Bottom Line Truth: When you add the sales tax increase, new and higher fees and the loss of exemptions, we are likely looking at a tax increase not a tax cut. This is particularly true for businesses, and most particularly for capital intensive manufacturers.

What can we do to keep this Amendment from passing? We must educate the individual voter on the dangers of this tax swap amendment. The average voter may see this amendment as just as tax cut! Educate your neighbors, family, friends, employees, associations and church leaders.

Current Status: The Circuit Judge ruling that Amendment 5’s wording is too vague to appear on the ballot is being appealeddirectly to the Florida Supreme Court. Its ruling is expected by August 26 and if it agrees with the circuit court, thenAmendment 5 will not be on the November ballot. Whatever happens, we believe that this or a similar proposal will come backin 2009. We also believe that every sales tax exemption is under attack because of the state budget shortfall.

Vote “NO” on Amendment 5 on November 4!

Shaw Environmental & Infrastructure, Inc.


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Contact: Mitzi Vergenz, Professional Engineer (904-367-6003)9143 Philips Highway, Suite 400, Jacksonville, FL 32256

Provides integrated financial, regulatory, scientific, engineering, construction, and program management services for government and private-sector clients worldwide.

Sponsor: Paul Steinbrecher, JEA

Florida Times-Union... Monday, August 25Did you know that the first edition of the Florida Times-Union newspaper was published on February 4, 1883? Don't miss thisopportunity to see the newspaper in action! Please dress accordingly with flat, closed-toe shoes for touring.

Details for the meeting:

When: Monday, August 254:00 - 6:00 PM

Where:One Riverside Avenue, Jacksonville (between Acosta & Fuller Warren Bridges)Map: Click for directions

RSVP: By clicking here

Safety Conference & Forklift Rodeo

LAST CALL FOR

EXHIBITORS AND SPONSORS!

Final deadline for Exhibitors and Sponsors is closing in!

Our October 27 conference at the Prime Osborn Convention will featurepresentations by experts in the field of safety throughout the day, exhibitors, and a new twist! Members are encouraged to send their forklift drivers to compete forcash prizes in its first annual Forklift Rodeo. Drivers will be scored onknowledge, accuracy and safety aspects of their machine operation.

Company challenges have been issued! Make sure you are represented!

Click for agenda, registration, exhibitor, and sponsorship information.

Sponsored by:


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Workshop - Background Checks (Sept. 24)

Take a Closer Look

at Your Prospective Employee

What every HR manager, plant manager, and president should know

Before you hire, you need to know about background screening and the legal requirements involved. Join us for this seminar to learn about:

Truth in applicationsThe Fair Credit Reporting Act (FCRA) and You

The myths surrounding National Criminal Checks

Checklist for Best practices--before and during employment

Review of case studies

When: Wednesday, September 24, 7:30 - 9:30 AM

Presenter:Donald J. Dymer, Inspector Scotland Yard (Retired)

President and CEO, SingleSource Services

Where:UNF University Center, 12000 Alumni Drive (Bldg. #43)Jacksonville, FL 32246

Cost:$65 - Members; $120 Non-membersIncludes continental breakfast

RSVP:FCMA Reservation Line (904-343-9372); Email - click hereNote: "No shows" will be billed; no refunds for cancellations less than 48

hours prior to event.

Exporting 101 WorkshopThe Chamber is offering a workshop on September 11 on exporting. Click here for details.

2008 Wage & Benefit Survey - HOT OFF THE PRESS!Thanks to the sponsorship of the following companies, FCMA is happy to offer members a copy of the 2008Wage and Benefit Survey for the price of only $75. Order your copy today!

Tim Gillis: (904) 598-8614

Ed Trent: (904) 598-8633

50 N. Laura St., Suite 2500

Jacksonville, Florida 32202

Main (904) 798-3700 Fax: (904) 798-3730

50 North Laura Street, Suite 3300

Jacksonville, FL 32202-3661

Phone: 904.798.3200Fax: 904.798.3207

Scott Cairns, Partner: 904-798-3223

Thomas Brice, Partner: 904.798-2629

Donald Anderson, Partner: 904.798.3230


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Douglas A. Ward, Managing Partner

Rene´ M. Fix - Labor & Employment Law

Lori S. Patterson - Immigration Law

Richard L. Maguire - Environmental Law 1301 Riverplace Boulevard, Suite 1500Jacksonville, FL 32207Phone: 904.398.3911Fax: 904.396.0663

Smith, Gambrell & Russell, LLPAttorneys At Law

Bank of America Tower, Suite 260050 North Laura Street

Jacksonville, FL 32202 (904) 598-6100

Patricia J. Hill - Labor & Employment(904) 598-6140

Dana G. Bradford, II - Litigation (904) 598-6103

Steven E. Brust - Litigation(904) 598-6107

Colin A. Thakkar - Labor & Employment(904) 598-6147

Steven L. Zakrocki - Labor & Employment(904) 598-6124

New Faces, Promotions, Awards, etc...Breidert/Soler & Palau hired Marty Schmitz as product manager/commercial products. Also Eugene Scotcher, CEO for theNorth American division, was featured in “People on the Move” in the JBJ August 8-14 issue.

Fleet Readiness Center Southeast (formerly NAVAIR) is now ISO 14001:2004 registered. Congratulations to your crew, Capt. Matthews!

Fowler White Boggs Banker added Thomas E. Gibbs and Karl B. Hanson Jr. as shareholders and hired David W. Barrett as an associate; also joining are Eric Holshouser, Tim Strong and Heather Gwinn.

Golder Associates Inc. welcomes Andreas Wagner as a certified industrial hygienist. Also… congratulations to Martha Mead

Ira for earning her Certified Hazardous Materials Manager credential, and to Molly Scheiner for passing the Florida Board of Professional Engineers exam!

The Grimes Companies promoted Ike Sherlock to vice president and hired Robert Sawyer as transportation analyst.

Harden & Associates… congratulations to Mary Flynn for receiving the Florida Literacy Coalition’s Outstanding LiteracyVolunteer Award! Harden also welcomes Idayah Anderson and Chrystal Boehringer as marketing account assistants, and Meaghan Bottin as account assistant, Commercial Insurance Division.

Holland & Knight hired Dan Coffman as attorney of counsel in its labor, employment and benefits practice.

Jaxport appointed Kenyatta Lee as senior director of administration.

JM Family Enterprises promoted Ed Sheehy to president of Southeast Toyota Distributors, executive VP of JM Family Enterprises and president of JM Lexus.

Lewis Longman & Walker: Wayne Flowers was selected as a 2008 Florida Super Lawyer.

Reynolds Smith & Hills welcomes Charles Tamblyn as Jacksonville leader and Michael Barry as field representive for Transportation & Public Infrastructure, Elizabeth Barnes as civil engineer, Fang Mei as senior Transportation Planner.

Rogers Towers hosted 34 students from Matthew Gilbert Middle school for its “Lawyer for a Day” program. Also… RTwelcomes Scott Padgett as an associate and Jessica Sloan as marketing coordinator.

The Ronco Group... Ron Avery assumes the newly created role as Chairman; Joe Krall has been promoted to president and


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CEO; Jim Snodgrass was promoted to VP of Corporate Performance; and, Rick Ingram joins as CFO.

Smith Hulsey & Busey hired Chris Henderson as an associate in its business department and Meg Ryan and Nick Morcom as associates in litigation. Also Stephen Busey, William Kuntz, Richard Lewis and Lanny Russell were recognized as Florida’s LegalElite.

The Stellar Group was recognized as one of the Top 100 Green Design firms in the US by Engineering News Record.

Synovus Bank promoted Jacky Warriner to assistant branch manager, Crystal Lyle to personal banker; Jackie Revels to VP/branch manager, John Springer to assistant branch manager, and Christina Dolson to personal banker (Northside branch). New hires: Sunny Hill, head teller (Southbank); Mandy Quinn, personal banker/float teller; Christa Wood, senior commercialassistant; David Edwards, management associate; Latrisha Bethune-Purter, head teller; and, Jamie Ballard, teller (Northside branch).

July 28 at Swisher

Thanks to Swisher for hosting last month's General Membership meeting. Youmade us feel right at home! For those who have not been in a while, it was great tosee additional expansions aswell as the progress made along its Lean journey.

Thank You, 2008 Contributors!We would like to recognize this year's sponsors:

Platinum Plus

Gerdau AmeristeelGoodrich

Maxwell House (Kraft)The Ronco Group

PlatinumAtlantic Marine, Inc. WhiteWave Foods

GoldPilot Pen

Smith Gambrell & Russell Silver

FMC Corporation

Each year we solicit funds for specific projects during the year. This year we will focus on public relations and publicity. The advantage of sponsorship is a yearlong recognition of the contribution through our website, General Meetings, and other public gatherings. Benefits include:

* Promotion of your company at FCMA events and in VOICE monthly

* Prepaid fees to select workshops/seminars based on contribution


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If you are interested in joining this list of contributors, contact Sherri Mitchell .

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View Newsletter ... · Safety Conference & Forklift Rodeo LAST CALL FOR EXHIBITORS AND SPONSORS! Final deadline for Exhibitors and Sponsors is closing in! Our October 27 conference

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