News from Tallahassee for 9/22/14

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State economic report casts doubt on feasibility of Scott's tax cut plan posted on 9/11/14

by michael van sickler | Times/Herald Tallahassee News Bureau

Dollar puzzleTALLAHASSEE — Since late August, Gov. Rick Scott's promise to slash taxes and fees by $1 billion over the next two years has been the backdrop for his re-election campaign, fueling a two-week tour through Florida.

But while Scott's campaign to promote the plan took him to the Panhandle town of Milton on Wednesday, the focus on whether it could actually work shifted 178 miles east to the Capitol, where lawmakers discussed the state's financial outlook.

The housing crash still haunts Florida's economy, state economist Amy Baker told legislative budget leaders. Florida is still No. 1 in foreclosure filings. Construction isn't projected to return to peak levels until 2022. Homeownership is at 65.3 percent, the lowest level since 1990.

Although tourism is booming, the housing hangover continues, forcing economists to project slower revenue growth than they had in the spring, Baker said.

"The residential real estate market is still sluggish," she said. "There's still a long way to go before normalcy is reached in Florida."

Assuming that lawmakers will set aside $1 billion in reserves, economists now estimate that next year's budget will produce a surplus of $336 million. That's less than half the $845.7 million surplus this year.

So, could Florida afford Scott's cuts?

"Unfortunately, we find ourselves in the middle of political season where things are said that can't be backed up,'' said Rep. Mark Pafford, D-West Palm Beach, the incoming House minority leader. "(Scott) commits a billion, but where do you find that? It's a campaign gimmick to increase his votes."

Announced on Aug. 29, Scott's package of tax cuts was so vague, it didn't explain when the cuts would take effect, or precisely define everything he's proposing.

The plan includes $200 million in cuts from sales tax holidays, and a $120 million reduction in the communications services tax, imposed on cellphone bills and other sources. Scott proposes a $120 reduction on the $225 charge for first-time vehicle registrations, but it's not clear how much this will cost the state in total.

Other plan components whose full impact aren't defined include eliminating the state's manufacturing sales tax, and phasing out the business income tax and the 6 percent sales tax on commercial leases.

Another tax cut, a limit on property tax increases that would affect local governments more than the state, would require the approval of 60 percent of state voters. While it sounds bold, it might not add up to much savings for homeowners.

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Scott promises $1B in tax cuts during campaign stop in Winter Park posted on 9/9/14

by Susan Jackson | Orlando Sentinel

WINTER PARK — Gov. Rick Scott brought his "Let's Keep Working" tax-cut tour to the Winter Park Chamber of Commerce on Monday, where he promised to reduce taxes by $1 billion over the next two years if he's re-elected.

The cuts would help businesses and families by giving people more money to spend on expenses from food to a college education, he said.

"We will be the No. 1 place to raise a family," Scott said. "This is about every family in Florida."

Scott, a Republican, touted his business-friendly record, praised small-business owners and gave them credit for creating jobs in Florida.

During his nearly four years in office, Scott said, his administration has cut taxes 40 times, trimmed 3,000 regulations, created more than 620,000 jobs, taken the budget from a deficit to a surplus and streamlined the permitting process. He also said he has lowered the cost of prepaid college tuition, making an education more affordable for working families.

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Property insurance could be key in governor’s race posted on 9/8/14

by Zac Anderson | Daytona Beach News-Journal

With Florida leading the nation in average home insurance premiums, the financial burden facing many residents could become a major campaign issue in the governor’s race this year and Democrat Charlie Crist is trying to position himself as the candidate who will provide rate relief.

Crist laid out a five-point plan last week to reduce rates that includes expanding a government-run program that sells cheaper reinsurance, repealing “anti-consumer insurance laws” and getting tough with insurers about passing on cost savings they’ve experienced in recent years to consumers.

Crist also emphasized his record of taking on insurance companies and accused Republican Gov. Rick Scott of doing “absolutely nothing” to help homeowners struggling with high premiums.

“They’re raising rates because they can, because Rick Scott lets them and our families and seniors are the ones paying,” said Crist, the former Republican governor.

Scott’s campaign shot back that Crist’s past actions as governor and future proposals are straight from “the Obama playbook of bigger government and skyrocketing debt.”

Property insurance has been one of the most controversial issues in state politics over the last decade. Crist and Scott have taken very different approaches to the problem.

Crist used the power of the governor’s office and legislative cajoling to block insurance companies from raising rates during his term in office, while Scott has emphasized less government interference in the marketplace.

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State program will use tax dollars to pay for enhancements to pro sports facilities posted on 9/8/14

by Drew Dixon | Florida Times-Union

There’s uncommon unity now over taxpayer funding of professional sports teams following several local and state developments in the past few months.

Not only Florida and Jacksonville, which have at times been at odds over sports franchises, but a state governmental watchdog group and other analysts, who have sometimes been skeptical about using tax dollars for professional sports operations, are unified behind new efforts to bolster sports facilities.

In June, Gov. Rick Scott signed into law a measure that created the Florida Sports Development Program. The program establishes a process for distributing tax revenues for the construction or improvement of professional sports franchise facilities.

The move nearly coincided with the establishment earlier this year of the Jacksonville Sports Council, which seeks to enhance sports activities and events in North Florida and focuses on all sports, not just professional.

Alan Verlander, executive director of the local council, said the state’s commitment to enhancing sports facilities couldn’t have come at a more opportune time.

“What the state is hopefully finally realizing through this is that it’s important to invest in what is bringing people to your city or cities across the state,” Verlander said.

Under the state measure, sporting projects and complexes seeking Florida tax revenue will initially have proposals evaluated by the Florida Department of Economic Opportunity. Then the disbursement of funds must pass approval by the Florida Legislative Budget Commission.

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'Hurricane Tax' on Insurance To End posted on 7/23/14


hurricane andrewTALLAHASSEE— An extra charge on property-insurance and auto-insurance policies to cover claims paid for the 2004 and 2005 hurricane seasons will end Jan. 1.

The Office of Insurance Regulation formally issued orders Tuesday for insurance companies to move up by 18 months the end of a 1.3 percent "emergency assessment" for the state-run Florida Hurricane Catastrophe Fund, which provides backup coverage to insurers.

The assessment has hit policyholders for $2.9 billion, which has gone to reimburse insurance companies for claims from the eight hurricanes that hit Florida in 2004 and 2005, the last time a hurricane made landfall in Florida.

"It's been nine years since (Hurricane) Wilma," said Sam Miller, executive vice president of the Florida Insurance Council. "If anything, the assessment helps us remember how devastating these storms may be."

Miller said the industry had been waiting for the orders so it could begin preparing for the new end date for the assessment, which previously had been set for July 1, 2016.

The orders make official a decision Gov. Rick Scott and the Cabinet made last month to end the assessment, Amy Bogner, a spokeswoman for the Office of Insurance Regulation, said in an email.

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