The Florida Restaurant and Lodging Association (FRLA) is proud of its accomplishments in the 2012 Legislative Session. Measures including Destination Resort Casinos, Online Travel Companies (OTC), School Start Date, Unemployment Compensation, and Minimum Wage were all targeted by the association and heavily lobbied during the 60-day session.
“Our 10,000 members were active and engaged in the legislative process and issues, which impacted their bottom line and our voices were heard loud and clear this Session,” said Carol Dover, President/CEO of the Florida Restaurant and Lodging Association. “We applaud Governor Rick Scott and the Florida Legislature for supporting a pro-business, pro-job growth agenda for the hospitality industry, the state’s largest employer.”
Here is the breakdown:
- Destination Resort Casinos—died in committee: The destination resort casino bill turned out to be one of the most controversial and lobbied bill this session. SB 710 by Sen. Ellyn Bogdanoff (R-West Palm Beach) and HB 487 by Rep. Eric Fresen (R-Miami)were filed early in the session with strong support from major casino industry interests. Both pieces of legislation would have brought three Vegas style casinos to South Florida, requiring a minimum investment of $2 billion in the development and construction of the resorts.
The Florida Restaurant and Lodging Association was joined by the Florida Chamber of Commerce, Florida Retail Federation, Attorney General Pam Bondi, CFO Jeff Atwater, and Agriculture Commissioner Adam Putnamin opposition to the expansion of gambling and the Destination Resort Casinobill.
The biggest danger of this legislation was the cannibalization of existing hotels and restaurants, the competition for limited discretionary dollars spent by tourists, and the decades spent to create Florida’s family friendly image. In the end, Florida’s family friendly image was saved.
Online Travel Companies—died in committee: For several years now, competing hospitality interests have been at odds both in Florida and across the country over how taxes should be calculated on hotel rooms obtained over the internet. This issue has appeared before Florida legislators for the past several years and will likely appear again in 2013.
This bill granted online travel companies (OTC), like Expedia, Travelocity, Priceline, and Orbitz, a special tax advantage, allowing them to pay taxes on the wholesale rate of a hotel room rather than the retail rate. HB 1393 by Rep. Jason Brodeur (R-Sanford) and SB 1888 by Sen. Andy Gardiner (R-Orlando) would not only have provided an unfair tax advantage to online travel companies, but would also deny local governments much needed tax revenue.
FRLA hoteliers traveled to Tallahassee on several occasions to voice their opposition to HB 1393. Neither the House nor Senatebill was heard in committee.
School Start Date—died in committee: Each year prior to 2006, many school districts around the state began to push their school year start dates further into the month of August. The inevitable finally happened, one school district decided to start its school year in July. It was at this point that parents around the state started to complain and the hospitality industry started to notice a reduction in sales and booking. Studies were performed and a significant and disturbing pattern was uncovered.
In 2006, legislation was passed so the school year start date could not begin any sooner than fourteen days prior to Labor Day. This was a compromise between parents, businesses, and educators. As the 2012 session began, HB 1243 by Rep. Larry Metz (R-Eustis) and SB 1468 by Sen. Bill Montford (D-Tallahassee) were introduced. Both bills would have given school districts the ability to set the school start date at practically anytime they please.
On “Florida Tourism Day”, FRLA members had a chance to discuss their concerns with Sen. Montford, and as a result amended his bill so that the school start date could not begin prior to August15th. The defeat of this bill was the direct result of FRLA members who participated in Tourism Day. The school start date will remain fourteen days prior to Labor Day.
Hospitality Education Program (HEP)—funded: The HEP program helps the hospitality industry grow its workforce by producing a pool of certified and immediately employable workers with the proper skill set to be an asset to the industry. The dollars in the Trust Fund are derived from a $10 license surcharge paid exclusively by Florida’s restaurant and lodging establishments for the sole purpose of funding this important program.
Approximately 21,000 students and 200 high schools participate in the HEP program. The FRLA worked diligently with the governor and legislative leadership to continue to provide the funding necessary to recruit and train the hospitality leaders of tomorrow.
Unemployment Compensation Tax Rate Reduction—passed: For two years state lawmakers have pushed back significant hikes in the state’s unemployment compensation taxes, however, businesses across the state are scheduled to get a sizable tax rate hike in 2012.
Florida’s trust fund began to deplete in 2009 by skyrocketing unemployment, causing Florida to borrow from the federal government. The taxable wage base was scheduled to increase from $7,000 to$8,500 in 2009, but business groups persuaded the legislature to delay an increase in the wage base for two years in hopes the economy would turn around and spark new hiring.
This taxation policy change will reduce the unemployment compensation tax increase by almost $50 per employee, saving employees $549 million over two years.
Guaranteed Higher Minimum Wage—died in committee: Due to the numerous restaurant closures and the cry for help from our members, FRLA took a bold move this legislative session by introducing SB 2106 which was sponsored by the Senate Commerce and Tourism Committee. The measure was heard in one committee and later died without further debate.
In 2004, a constitutional amendment was adopted in Florida that immediately raised the minimum wage by $1 per hour and also provided for annual increases in the Florida minimum wage, indexed to inflation.
Under the amendment, however, the Florida minimum wage differs from the federal model as applied to tipped employees. For tipped employees, the amendment permanently set the tip credit at $3.02 per hour. So, regardless of how much an employee actually earns in tips, e.g., $10 per hour, $20 per hour, etc., the direct cash wage paid by the employer always goes up in lock step with the inflation increases in the Florida minimum wage.
At present, with a $7.67 per hour Florida minimum wage, this means employers must pay a tipped employee at least $4.65 per hour, regardless of how much the employee receives in tips. Again, this compares to only $2.13 per hour under the federal law, which prevails in most other states.
SB 2106 would have allowed the option for an employer to choose an alternative method of paying tipped employees whereby the employer guarantees a wage, including tips, to equal at least 130% of the Florida minimum wage, which would currently equate to $9.98 per hour.
For employees who receive a relatively small amount of tips, the employer would end up paying a higher direct cash wage than would be required under the present law. For employees who receive a larger amount of tips, and who are therefore making considerably more than minimum wage, the employer would pay a smaller direct cash wage.
This change would allow restaurants to stabilize their economic positions, remain open, and continue to keep Florida’s number one industry and largest private employer afloat during these tough economic times.