Historic City News watched yesterday as Agriculture Commissioner, Adam Putnam, said that in 2014, he will push for a $250 million reduction on sales taxes that businesses pay for energy; proposing to cut in half the commercial energy sales tax — noting that residential utility customers do not pay the tax at all.
This was welcome news for those in Orlando attending the Florida Energy Summit, sponsored by Putnam’s department, as well as public education administrators. Commissioner Putnam says he would like to see the remaining 3.5 percent sales tax on business energy go toward the Public Education Capital Outlay Fund; established in 1963 to pay for school construction and maintenance programs.
“The funding mechanism for the Public Education Capital Outlay Fund is essentially broke,” Putnam said in his opening remarks. “The state has been subsidizing that out of the general fund for the last several years; but, by cutting the tax on the commercial purchase of electricity in half, we can help businesses while we help the next generation of Floridians.”
Putnam noted that Gov. Rick Scott has proposed cutting taxes by $500 million in 2014 amid a budget surplus. The governor has asked the public for ideas on where to make cuts and Putnam’s proposal could be part of that proposed tax cut.
The Legislature in 2011 transferred the Florida Energy Office from the governor to Putnam’s department. After several years of failed legislation to require or encourage more renewable energy, the Legislature in 2012 passed what Putnam described as a “modest” energy bill (HB 7117) providing $100 million in tax breaks over five years for the development of renewable energy.
In 2013, the Legislature passed HB 579 providing a $25,000 per vehicle rebate for converting commercial fleet vehicles to natural gas. The bill calls for spending $6 million per year for five years.
The Legislature in 2013 also passed HB 277 to partially implement a 2008 constitutional amendment that exempts renewable energy improvements from residential property tax assessments. In addition to the tax cut for commercial energy use, Putnam said he would propose extending the tax exemption for renewable energy improvements to commercial property.
Putnam also proposed creating a “sales tax holiday weekend” for the purchase of energy- and water-saving appliances costing up to $1,500. He said a 2010 rebate program for Energy Star appliances saved 7.6 million kilowatt hours of electricity and 124 million gallons of water in a year.
He said he would ask the Legislature to create a fund to support innovators and entrepreneurs that need to match other grant funds, using $4 million in unspent or returned money from a 2006 renewable energy grant program.
And, his legislative package would include a proposal for a forecast of natural gas supplies and future prices, infrastructure and opportunities for storage and use in transportation.
Putnam concluded his remarks by saying Florida was “on a roll” with energy legislation.
“Let’s keep it up,” he said in closing. “Let’s make it three for three.”
The Florida Energy Summit continues through today and is being broadcast on The Florida Channel.