Last-minute insurance premium tax break surfaces
As lawmakers ended budget talks Thursday, a new idea suddenly surfaced: Giving tax credits to insurers for paying insurance premium taxes faster. The revenue, estimated at up to $1.5 billion, would shore up an estimated $3 billion shortfall in the state's hurricane catastrophe fund, the source of money to pay homeowners if a major hurricane strikes Florida.
Senate Budget Chairman JD Alexander, R-Lake Wales, said "one of the big banks" suggested the idea. It was tacked on a budget conforming bill (HB 5505) that awaits up-or-down votes in both houses Friday. Alexander said the tax break must be proposed by Gov. Rick Scott to the state Board of Administration, which oversees the CAT fund. "It's just a tool. I don't even know whether the tool would work or not," Alexander said. "It's just a financing mechanism."
The idea, explained in a one-sentence explanation labeled "new item," was so novel that House budget negotiators met privately so a staff member could brief them about it. Their brief session was closed to reporters, despite repeated assurances of transparency by legislative leaders during the budget process. Security personnel refused to allow reporters access to the lawmakers.
Asked if senators could cast educated votes on a proposal that first surfaced on the next-to-last day of the session, Alexander said: "I would guess so. If not, they'll fail it. That's fine too." In 2008, the state struck a deal to pay $224 million to billionaire investor Warren Buffett in return for his pledge that he would purchase $4 billion in CAT fund bonds following a hurricane.