ORANGE COUNTY, Fla. — Tensions appear to be escalating between the state of Florida and the California-based Sanford Burnham Prebys Medical Discovery Institute.
In October, it was revealed the state of Florida, through the Department of Economic Opportunity, was requesting Sanford Burnham refund $77.5 million in incentives it received to create jobs at Orlando's Lake Nona Medical City.
Sanford Burnham had been eyeing handing off its operation to the University of Florida; however, that deal fell through and the state, fearing Sanford Burnham will leave Florida, is attempting to recoup some of the money it spent.
Channel 9's Christopher Heath obtained a letter from an attorney representing Sanford Burnham that said the group will not be refunding the state any of the money because it is "not in material default of any obligation in the agreement."
Under a 10-year funding agreement, Sanford Burnham received $155 million from the state of Florida based on job creation milestones through 2016.
It is half of the state’s payment that the DEO requested from Sanford Burnham in an Oct. 28 letter. The DEO’s main contention is that Sanford Burnham, which created 262 new jobs (303 were required) at the Lake Nona facility, failed to meet its benchmark and is ceasing operations at the center.
Earlier this year, 9 Investigates reported that Sanford Burnham was eyeing an exit from its Orlando Medical City facility.
In October, 2015, credit rating agency Fitch Ratings wrote in a press release regarding Sanford Burnham’s California bonds, “management reports that it is evaluating the long term plan for the Florida operations since the state funding is ending and the operations are unprofitable.”
In a letter to the DEO from attorney Knox Bell on behalf of Sanford Burnham, the group is ambiguous about its long-term plans for the Lake Nona facility saying only, “SBP does commit to remain in Florida for the next year, assuming current circumstances remain substantially unchanged.”
The letter continues, “SBP will continue to explore other potential viable long-term sustainability plans.”
In a response Florida DEO wrote in a statement, “DEO remains committed to holding Sanford Burnham accountable for all taxpayer monies received and will continue to investigate our options for any repayment necessary of incentive funds that were provided to Sanford Burnham.”
The Florida Legislature, which will meet in March, has said it intends to take a look at the deal between Sanford Burnham and the state.
“They made a commitment to the state,” Rep. Jason Brodeur, R-Sanford, said. “I’m not sure what our options would be but the state upheld its end of the agreement and we expect them (Sanford Burnham) to uphold their end of the agreement as well.”
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