Office of Program Policy Analysis and Government Accountability
Office of Program Policy Analysis and Government Accountability

Agency Review - Enterprise Florida, Inc., and Department of Economic Opportunity

Report 16-09, December 2016

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Report Summary

  • EFI has reduced staff and begun to shift several programs to DEO; there are opportunities for additional streamlining. A recent organizational assessment made a number of recommendations designed to focus EFI on its primary functions, shift non-core programs to DEO, and reduce agency costs. EFI has implemented several of the recommendations. However, while these efforts have helped restructure EFI's operations and narrow its focus to core mission, there are additional opportunities to diminish overlap with DEO activities and further streamline the agency, including consolidation of EFI into DEO.
  • Private sector cash investments represent a very small portion of EFI's overall budget; EFI's escrow account funds could generate significantly more interest income if held in a state trust fund. According to EFI financial data, state funding has always far exceeded private sector funding. For example, private sector cash contributions during OPPAGA's review period rarely exceeded $2 million, while state appropriations averaged about $20 million per year. In addition, $122.6 million in funds obligated to businesses via contract are in a commercial escrow account. However, using a state trust fund to hold these funds would generate approximately $1.93 million more annual interest than the commercial account.
  • Many businesses believe that DEO's incentive claims and payment processes need improvement. Nearly 40% of OPPAGA survey respondents thought the incentive claims submittal process needed improvement and 47% thought the incentive payment process needed improvement. To measure the timeliness of these processes, OPPAGA examined claims data and found that the average time claims submissions spent with the third-party auditor was nearly 12 months and the average time between claims submissions and incentive payments to businesses was more than 16 months.
  • DEO's Economic Development Incentives Portal received high ratings from businesses but could be improved to provide better functionality. Most OPPAGA survey respondents rated the portal as useful or very useful. However, recipients suggested that the portal could be improved, including providing more data fields in the search reports, improving search functions, and providing users the ability to export search results as an Excel or PDF file.
  • The selection process for DEO's community planning grants lacks a uniform review and scoring process. While program staff recently created and implemented a scoring evaluation tool for the Competitive Florida Grants, the department has not developed selection criteria for the Community Planning Technical Assistance grants. To address this concern, DEO should establish a uniform review and scoring process for the two grant programs.
  • Very few businesses participate in several of DEO's small and minority business and rural economic development programs; lack of marketing may affect participation. According to program administrators and DEO staff, Microfinance Loan Program participation is limited by short loan repayment terms and lack of geographic reach. In addition, Black Business Loan Program participation has decreased significantly; the program had only 12 active loans in Fiscal Year 2014-15. Finally, participation in the Rural Community Development Revolving Loan Fund Program has always been very low; since 1996, the program has made only 17 loans. Program staff indicated that a potential reason for low participation is that there are no formal marketing activities that promote the programs to rural local governments or economic development organizations within rural counties.
  • Businesses are generally satisfied with the state's workforce services, but finding qualified job applicants remains a significant challenge. OPPAGA surveyed businesses that received workforce services in 2016. Most businesses (70%) reported that they are satisfied overall with the services received. The most frequently cited challenge to Florida's workforce system issue was difficulty finding qualified job applicants with the appropriate skills (47%), and the most frequently reported suggestion for overcoming challenges was more training and education for job seekers (35%). Several businesses also reported difficulties using Employ Florida Marketplace, saying that the system is slow and difficult to navigate.
  • One-stops and local workforce boards provide many services; respondents cited a number of challenges to effective service delivery. OPPAGA surveyed One-Stop Career Center operators and Local Workforce Development Board executive directors and presidents/CEOs. The survey revealed several themes. For example, one-stops offer standard and specialized workforce services and collaborate with several other entities. One-stop and workforce board interaction with state agencies is primarily limited to DEO and CareerSource Florida, with very little interaction with EFI. Local workforce entities perceive several challenges in Florida's workforce system, including gaps between job seeker skills and employer needs and lack of training for trade jobs. These entities also voiced concerns about online tools like Employ Florida Marketplace and the state's online reemployment assistance system (CONNECT).
  • There are several options for improving Florida's economic development system. There are additional opportunities to narrow EFI's focus on its core activities and steps that EFI and the Legislature could take to improve agency programs and activities and reduce costs. In addition, to enhance efforts to support the state's business, community, and workforce development efforts, DEO and the Legislature could consider several options to increase program efficiency and business participation across the department's three main divisions. There are also opportunities to improve communication between the state's economic development and workforce development entities and improve the functionality of DEO data systems.

Related Reports
  1. Florida Economic Development Program Evaluations - Year 7
    Report 19-16 December 2019
  2. Florida Economic Development Program Evaluations - Year 6
    Report 18-07 December 2018
  3. Florida Economic Development Program Evaluations - Year 5
    Report 17-13 December 2017
  4. Florida Economic Development Program Evaluations - Year 3
    Report 15-11 November 2015
Copies of this report in print or alternate accessible format may be obtained by email OPPAGA@oppaga.fl.gov, telephone (850) 488-0021, or mail 111 W. Madison St., Room 312 Tallahassee, FL 32399-1475.
Copies of this report in print or alternate accessible format may be obtained by email OPPAGA@oppaga.fl.gov, telephone (850) 488-0021, or mail 111 W. Madison St., Room 312 Tallahassee, FL 32399-1475.
Economic development, workforce development, community development, Enterprise Florida, Department of Economic Opportunity, economic incentives, local economic development organizations, CareerSource, competitor states, business climate, state ranking, public-private sector, business community, competitive advantage, employment and wages, target industry, jobs, capital investment, growth, expansion, new business