Corporate Con Artist Jeff Vinik Gets Tax Break Intended for Poor

 

By Jim Bleyer

When Congress approved the creation of “opportunity zones” as part of Donald Trump’s 2017 tax code overhaul, it didn’t have half-billionaire Jeff Vinik in mind as the legislation’s sole beneficiary in downtown Tampa.

But a cabal of enablers—Senator Rick Scott, former Tampa Mayor Bob Buckhorn, and current Mayor Jane Castor—has dumped millions of diverted dollars in Vinik’s lap and itches to give him even more.

The opportunity zone tax break was purported to be the prime anti-poverty measure of Trump’s Tax Cuts and Jobs Act of 2017.  The plan drew bipartisan Congressional support and is supposed to incentivize investors to direct their capital to needy areas. In exchange, they get a lucrative break on capital gains taxes.

At latest count, there are more than 8,764 zones in the United States and its territories.

The tax break, thanks to Scott, went to Vinik for his upscale Water Street Tampa project downtown and bypassed low income families that were the designated beneficiaries.  In fact, the years-behind-schedule development will further gentrify Tampa’s core and displace the poor.

Vinik was a high-profile contributor to Scott’s successful 2018 senatorial campaign and supported Castor in last spring’s eight-way Tampa mayoral race.

A recent article in Pro Publica recounts the Opportunity Zone abuses in Florida but concentrates on South Florida where billionaires Wayne Huizenga Jr. and Jorge Perez are the focus.  Vinik, far less wealthy and well known, receives only a passing mention.  Perez, Miami’s ”condo king” acquired property in downtown Tampa a couple of years ago for development.

Pro Publica reported that “wealthy donors Wayne Huizenga Jr. and Jeff Vinik lobbied then-Gov. Rick Scott for the lucrative tax break —and won it.  Poorer communities lost out.”

A spokesman for Scott did not comment directly on the specific projects.  Castor refuses to answer questions posed by Tampa Bay Beat about opportunity zones, her favoritism towards Vinik, or any matter regarding her tenure as Tampa police chief and future plans for Tampa as the city’s chief executive.

We will have more on Castor in upcoming stories.  She is anxious to divert more public money—this time for a baseball stadium in Ybor City—to help Vinik’s flailing development and enrich Tampa Bay Rays owner Stuart Sternberg.

The Federal Bureau of Investigation has launched a probe into real estate deals surrounding the stadium as well as Vinik’s heavily promoted transit tax.  Both a stadium and light rail system would displace minority communities near downtown and East Tampa.

County Commissioner Ken Hagan is a publicly known fed target but so are others who are helping grease Tampa land deals.

Vinik’s lifetime of chiseling makes Auguste Rodin look like an amateur.

Water Street Tampa was originally conceived as a health-oriented development because Vinik’s fellow grifters, former University of South Florida president Judy Genshaft and one percenter Frank Morsani, agreed to have USF’s Morsani College of Medicine anchor the fledgling project.

But Vinik failed to legitimately attract any tenant remotely connected to “health.”  The project, on life support, got its Opportunity Zone windfall from Tallahassee after Vinik threw 200K into Scott’s Let’s Get to Work PAC.

The former Boston-based hedge fund manager reinvented himself when he relocated to Tampa in 2010.  Many residents remain unaware Vinik managed two underperforming hedge funds, endured ethical controversies involving his management of the funds, and that he was a target of several shareholder lawsuits and an SEC investigation.

Tampa Bay residents will never get such information from the Tampa Bay Times.  Vinik is the paper’s de facto owner.

He initially ran Fidelity Magellan, the world’s largest stock mutual fund at the time, only to step down in 1996 after a costly bet on Treasuries.

Just prior to his departure,  the New York Times reported: “In the last six months, shifts in the fund’s portfolio have been relentlessly scrutinized and roundly criticized as its performance lagged further and further behind the overall stock market. More than a dozen lawsuits have accused the then 37-year-old Mr. Vinik of stock manipulation, contending that he extolled a stock in public to keep its price up as he quietly sold large holdings -a claim that he denies.”

A year later, Fidelity Investments paid about $10 million to settle a lawsuit against the company and Vinik, its former manager.  Plaintiffs claimed he misled individuals into buying Micron Technology stock at the same time the Magellan Fund he managed was selling the stock.

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