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Florida CVB, EDC on the Defensive in Response to Allegations of Funding Improprieties

22 Feb, 2017

By: Mary Helen Sprecher

Despitethe presence of Zika, a shooting in a nightclub and several hurricanes, it was a contract with a rapper named Pitbull that actually helped knock Visit Florida, the state’s CVB, to its knees. Now, Governor Rick Scott is fighting to save the organization, as well as its business development counterpart, Enterprise Florida. And in the actions of both groups is a warning to CVBs and EDCs everywhere.

According to an article in WSUF Public Media, Scott is facing down legislators who have called the spending of the organizations into question, and who, two weeks ago, voted to eliminate both public/private partnerships.

In an effort to save the groups, Scott has been touting Florida's positive job creation numbers in 2016 and the overall impact of tourism on the state, and noted his shock at Representative Shawn Harrison's vote against the continuation of Visit Florida and Enterprise Florida, the economic development council, or EDC, in light of those numbers.

“If we didn't get the tax revenue statewide from tourists that we get, all of our taxes per household would have to go up $1,500,” Scott said. “We wouldn't have record funding for USF. We wouldn't have record funding for K-12, state colleges and universities. So this is a significant issue.”

The crux of the matter is an alleged lack of transparency when it comes to funding. Scott doesn’t have issues with legislators over the spending; in fact, in December 2016, it was he who actually called for the resignation of Visit Florida CEO Will Seccombe after Pitbull disclosed he had been paid in excess of $1 million for his campaign, according to The Orlando Sentinel.

According to the Sentinel, Pitbull, whose real name is Armando Christian Perez, posted his 2015 contract with the state on Twitter, revealing he was paid that $1 million in taxpayer dollars to promote Florida in social media posts, at his concerts and in a music video called “Sexy Beaches.”

An article in a Fox News online report noted that Pitbull had tweeted "FULL DISCLOSURE - FLORIDA" with a link to the 11-page agreement to produce the "Sexy Beaches" video for Visit Florida and to promote the hashtag #LOVEFL on his social media sites and during concerts.

The Sentinel article added something that certainly smacked of back-room dealings: Visit Florida officials said Pitbull had declared details like how much he was paid, his duties under the contract and even his agent’s name trade secrets exempt from Florida’s public record laws, even though Visit Florida receives tens of millions of dollars in tax money every year.

The remarks over this have been inconsistent, at best. Seccombe told the Sentinel in 2015 that such details should be kept hidden so the state could get a good bargain, but later told a Senate panel he would never do similar deals that couldn’t be divulged. He also defended the $1 million contract as a good arrangement for the state.

Gov. Scott later said the deal was “ridiculous and must be fixed. Taxpayers have a right to know how their money is spent.” Those remarks came just weeks after he stood by Seccombe at a news conference in Jacksonville and revealed that 85 million people had visited Florida during the first three quarters, a record.

But, noted the Sentinel in a separate article, even before the Pitbull scandal, a fight was brewing for Visit Florida over its budget and structure. With bipartisan support, Visit Florida's state funding increased from $26.6 million in 2011 to $78 million this year. Next year, it's asking for $76 million.

The U.S. Travel Association has already weighed in, noting that defunding Visit Florida will hurt tourism, according to an article in Travel Weekly.

Still, there’s hope the organizations will live on. Senate leaders have criticized the wisdom of the Pitbull contract while still expressing support for Visit Florida:

Sen. Jeff Brandes, R-St. Petersburg, who chairs the budget committee overseeing Visit Florida, says he's still "developing his thinking" on what the department's structure and oversight should be long term, but said the group is vital to Florida's economy.

"It's important that we realize what would Florida tourism look like without Visit Florida," Brandes said. "And if we believe it would effect a 1 percent [decrease], is it worth it for 1 percent? And that number would be a million tourists."

The looming conflict leaves the future of Visit Florida in question ahead of the legislative session, which begins in March.

For his part, Scott continues to champion the efforts of Visit Florida and to characterize those who oppose it as "putting more than 1.4 million jobs at risk."

The latest development is a proposal by the Florida House to make a 67 percent budget cut to Visit Florida, and to require more oversight, according to an article in Meetings & Conventions. The proposal calls for a total budget of $25 million and making Visit Florida a part of the Florida Department of Economic Opportunity.

SDM will continue to cover this issue. In the meantime, it is a cautionary tale about transparency in budgeting and expenses.

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