House Policy & Budget Council

January 8, 2008

Thank you Mr. Chairman and members of the council.  My name is Barney Bishop and I’m the president and chief executive officer for Associated Industries of Florida.  Today, I am here to comment about a proposed Economic Stimulus Package, which I believe you will find in your meeting book.

This Package is supported by 17 business groups, some of which are here today to testify in support.  The groups are:

Associated Builders & Contractors Association of Florida
Associated Industries of Florida
Association of Florida Community Developers
Florida Association of Realtors
Florida Bankers Association
Florida Credit Union League
Florida Farm Bureau Federation
Florida Home Builders Association
Florida Natural Gas Association
Florida Pest Management Association
Florida Petroleum Council
Florida Retail Federation
Florida Roofing, Sheet Metal & Air Conditioning Contractors Association
Florida Transportation Builders Association
Florida Trucking Association
Florida United Business Association
Floridians for Better Transportation

The purpose of this Stimulus Package is to encourage you – the legislature – to address the short term need for permanent infrastructure improvements with non-recurring revenue so that as Florida and the nation emerge from this economic trough Florida will be properly positioned to take advantage.

As all of you know, Floridians are very concerned about the state of our economy.  Our economy has been hurt by the tremendous downturn in the housing and construction industries and as a consequence the state’s treasury has taken a significant hit as well.  I know that you have heard many times before that Florida’s economy is based on three (3) legs:  tourism, agriculture and services.  I personally believe that is not entirely correct.  I believe there is a fourth leg and that is GROWTH.  With a current infrastructure backlog in excess of $30 billion, there is no hope that current residents are going to be able to pay this tab.  It will be incumbent upon us that future residents of the state must help us to bear the cost of this backlog, not entirely, but to some degree.  Obviously we cannot foist all of this backlog cost upon new residents because they will not be able to bear the burden by themselves either.  Therefore, we must consider a package such as this one presented today if we are to have any hope of weathering this economic storm successfully.

The seven components are as follows:

  • Roads – transportation infrastructure is the KEY to everything else.  With citizens in seemingly constant traffic gridlock, we must do everything we can to alleviate this critical piece of the problem.  There are “Ready-to-Go” road projects that need to be funded.  In doing so, we can put people back to work, help meet concurrency requirements and help fuel smart growth coordination.
  • Affordable Housing – The Sadowski Fund has hundreds of millions of dollars sitting in it, and at a time when citizens, employees, and seniors are desperately seeking affordable housing and apartments, this is a perfect time to empty the coffers of this trust fund and help Floridians with homes that they can afford.  In urban core area’s, this almost certainly means “vertical” development, but in suburban and rural area’s we can still rely on traditional “horizontal” development.
  • Schools - Though we are in perhaps a temporary downturn in pre-K-12 school enrollment, we still must build schools for the future.  To do so without emptying our treasury, we should re-look at the Class Size Amendment and consider freezing it or modifying it so that we can meet the district-wide standard rather than the current classroom standard.  This will still mean that schools will be built, but will help to insure that they are not over-built.
  • Alternative Water Supplies – this is a corollary issue to road construction because as we build new roads, we will need to take into account our growing need for both potable and non-potable water, reservoirs and cutting-edge desalinization plants.  And the problem has only worsened because of the current drought.  Both agriculture and citizens need a reliable supply, yet we still have far to go.
  • Ports – Florida’s 14 deep water ports and one shallow water port are economic engines that need help.  Not on the government side, but on the tenant side.  One of the key missing ingredients is appropriate warehousing and distribution space so that goods can be stored and then put on ships as they leave the Sunshine State.  This concept has worked incredibly well for Savannah, GA, which has now become a tremendous competitor to the Port of Jacksonville.  But to make matters worse, we have a dual security system one that meets Florida law and one that meets Federal law that other competing ports in Georgia, Alabama and Louisiana do not have to meet.  This makes the cost of doing business at our ports uncompetitive and is hurting our ability to grow business at our ports.
  • Space – with respect to our future and in recognition of our illustrious past, Florida needs to understand that Virginia, California, Colorado, New Mexico and Texas are positioning themselves for the business of private space flight – both manned and satellites.  Florida has two things going for it:  (a) we already have much of the infrastructure, but we need to acquire some of it for ourselves and then rehab it for the future, and (b) our geographic position on the planet gives us an inherent advantage over everyone else – we are closer to the equator and since the planet spins faster the closer one gets to the equator, the cost of fuel for a launch is inherently lower for us.  Also because of our position on the east coast, if we have a problem with a launch we have the Atlantic Ocean as a buffer, which only Virginia shares with us.  We have a five year window between the end of the Space Shuttle 2010 and the beginning of the Constellation program in 2015 that is going to be critical for the 5-6,000 highly paid engineers that we need to keep in Florida.
  • Research Institutes – along with space, the research institutes from California and now recently Germany, also represent the future for Florida.  The research and development into bioscience, biomedicine, etc. is perfectly aligned with the space program which is charged with putting Americans back on the moon to live, and eventually to live on Mars as well.  Many of the engineers from the space program are very well suited for retraining in these growing institutes.
  • Tourism – with a strategic investment in some niche markets both in America and abroad, we could help bring much-needed dollars to our state treasury in the form of goods and services for tourists.

Mr. Chairman, in closing thank you for this opportunity to present some of these ideas.  This is not meant to be a complete list; these are just some key areas that we believe need to be considered.  I’m happy to try and answer any questions.