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Firm pays back county on failed incentives


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  • | 3:01 p.m. August 24, 2016
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  • Manatee-Sarasota
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Five years after Sarasota County paid out economic incentives to Tube Dude, the company behind smiling colorful sculptures on front lawns and mailboxes in and around downtown Sarasota has repaid the amount in full.

Owner Scott Gerber completed the last of six $9,333 payments July 31. He signed an agreement with the county to do so in 2014, after failing to create jobs and returning equipment that was purchased with the original incentive grant.

“Nine thousand dollars in the summer time is a tough nut for a small business to come up with,” Gerber, who recently moved his business from a storefront on St. Armands Circle to downtown Sarasota, told the Sarasota Observer, sister paper of the Business Observer. “It was always on the back of my mind every single day.”

In 2011, the county signed an agreement to pay $56,000 for Tube Dude to expand its operations, and promised another $1,000 each for 44 new jobs created for a total of $100,000. But new employees never materialized, nor did his business expand, which Gerber blamed on not receiving the $250,000 he originally requested.

“My plan was to buy two companies that already had the 40 employees up in Bradenton, and put everything under the Tube Dude name down here,” Gerber says. “My whole plan at that point was completely kiboshed.”

Sarasota County Economic Development Coordinator Lisa Damschroder said the county determined $100,000 was a realistic incentive amount after reviewing the firm's financials, and said there was never a formal request for more than that amount.

The county has since implemented pay-for-performance grants, where a business must first prove it has expanded or added employees to receive any benefits. But, three companies still owe $450,000 in non-performing incentives.

In addition to Tube Dude, six companies have either repaid, or are in the process of repaying, $387,000 in subsidies. All of the refunds return to the economic incentive fund, Damschroder says. “We have a few additional companies whose job creation periods will be coming to an end within the next few months and may be responsible for payback due to non-performance.” Damschroder says. “We are monitoring those now.”

 

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