Scott loses on tax cuts and incentives as budget talks begin
The Florida Legislature opened budget negotiations with a bang Friday by immediately handing two huge defeats to Gov. Rick Scott on both of his priorities of tax cuts and money for incentives to attract jobs.
Scott wanted $1 billion in tax relief, and legislative leaders say they have agreed to $400 million. Scott wanted $250 million over three years for a new enterprise fund to attract jobs to the state and leaders wiped it out.
"The enterprise fund is at zero," Rep. Richard Corcoran, R-Land O'Lakes, chairman of a House-Senate budget conference committee, told reporters after budget conferees held a three-minute organizational meeting.
Corcoran and other House leaders had opposed the $250 million incentive fund, calling it "corporate welfare" and openly ridiculing Scott's contention that it is needed to attract jobs.
Sen. Tom Lee, R-Brandon, vice-chairman of the budget conference panel, said the legislative leadership has agreed to $400 million in tax cuts, less than half of what Scott had demanded. Details of the tax cut package were not immediately available.
By setting on $400 million in tax cuts, lawmakers are forcing Scott to violate a major promise he made to Florida voters in his 2014 re-election campaign that he would cut taxes by $1 billion over two years. (Last year's tax relief package was slightly below $450 million).
Lee said only $200 million of the tax cuts would be recurring or permanent. That's yet another damaging blow to Scott, who wanted more than three times that much in recurring tax cuts, much of it in the form of a reduction in taxes on commercial leases paid by businesses.
"We came up to a number that we thought made sense based upon the long-range financial outlook we have for our state, and that's where we settled," Lee said.
Senators originally proposed $250 million in tax cuts, far short of what Scott and the House supported. Lee and other senators said they would be putting the state in future financial jeopardy if they cut deeper than that.
With two weeks left in the legislative session, the decision by Republican lawmakers to quickly dismiss the priorities of their party's governor could have dire political implications.
"With the Legislature’s action today, there will no longer be incentive funding for major projects to come to Florida, like Northrop Grumman or Navy Federal Credit Union, and we are beginning the process of notifying cities across the state that there would be no funding available to help them recruit businesses if the legislature does not take immediate action to reverse course," Scott's office said in a statement.
Budget negotiations are expected to continue all weekend, but so many lawmakers went home Friday thatit wasn't clear whether some budget conference committees would have enough members to meet.
Lawmakers have until Tuesday, March 8, to reach a budget deal for the 2016 session to end on schedule on March 11.