Make us your home page
Instagram

Citizens loan proposal needs more review

TALLAHASSEE — Citizens Property Insurance Corp. on Tuesday opted to temporarily delay approval of a controversial $350 million loan to private companies, but also indicated it might not comply with a request from a top lawmaker calling for legislative review of the program.

After incoming House Speaker Rep. Will Weatherford, R-Wesley Chapel, wrote a letter questioning the board's authority to implement the $350 million loan program without approval from lawmakers, Citizens president Barry Gilway said the company would slow down and bring in a third-party financial firm to review the program.

But Gilway and several board members stopped short of complying with Weatherford's request that Citizens hold off on approving the program until the Legislature held hearings.

"Time is a factor, we have a clock in this game," said board member John Rollins, expressing concern about delaying the program. "Running out the clock is not a good (depopulation) strategy."

Weatherford's office said Citizens had not addressed his main concern — that the state-run insurer might not have the authority to implement the massive loan without approval from the Legislature.

"The letter raised specific concerns, which Citizens has not addressed about the Legislature's authority," Ryan Duffy, a spokesman for Weatherford, said. Incoming Senate President Don Gaetz, R-Niceville, said he "support(s) Speaker Weatherford's position on this issue."

Citizens' decision to move ahead with the controversial loan sets up a potential showdown between the increasingly independent board of governors and the Florida Legislature, which created the state-run insurer in 2002.

Gov. Rick Scott, who sparked Citizens' ambitious plans to shed policies, weighed in Tuesday as well, stating that he believed the board had the authority to implement the $350 million loan. The money would go to private companies that agree to take over policies from Citizens.

"I think the structure is that there is a board, and this is the purview of the board," said Scott, when asked if he agreed with Weatherford's call for legislative review. "The board has the right to make the decision."

Board members indicated Tuesday that Citizens planned to approve the program as early as December, months before lawmakers converge in Tallahassee for the 2013 lawmaking session.

But Weatherford's office said the Legislature's committees would not start meeting until December at the earliest, making it unlikely that Citizens' schedule would comply with the request for legislative hearings.

Citizens said it would work with Weatherford's office on a compromise, but insisted that launching the program this winter was key to getting it in place before the next hurricane season.

The $350 million program would provide low-interest loans to private insurers who take over policies from Citizens and agree to keep them for 10 years. It could help shrink the insurer of 1.4 million by up to 300,000 policies, potentially saving taxpayers money in the event of a massive hurricane.

Chief Financial Officer Jeff Atwater, Insurance Consumer Advocate Robin Westcott and some Republican lawmakers have raised questions about the financial soundness of the program. All have called for a more thorough vetting of the loan, which was unveiled in September and quickly approved, in concept, within 48 hours.

"The insurance industry thought they could just slip a multimillion dollar corporate welfare initiative by policyholders and lawmakers, without even going through the legislative process," said Sean Shaw, founder of Policyholders of Florida, a consumer advocacy group. "It's refreshing to see more and more lawmakers beginning to stand against insurance industry lobbyists and say enough is enough."

Citizens loan proposal needs more review 10/09/12 [Last modified: Tuesday, October 9, 2012 8:03pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. 'Road to Nowhere' is back: Next phase of Suncoast Parkway coming

    Roads

    Despite intense public opposition and dubious traffic projections, the Florida Department of Transportation has announced that construction of the toll road known as "Suncoast 2" is expected to start in early 2018.

    The Suncoast Parkway ends at U.S. 98 just south of Citrus County. For years residents have opposed extending the toll road, a project dubbed the "Suncoast 2" into Citrus County. But state officials recently announced that the Suncoast 2 should start construction in early 2018. [Stephen J. Coddington  |  TIMES]
  2. A sports rout on Wall Street

    Retail

    NEW YORK — Sporting goods retailers can't shake their losing streak.

  3. Grocery chain Aldi hosting hiring event in Brandon Aug. 24

    Retail

    BRANDON — German grocery chain Aldi is holding a hiring event for its Brandon store Aug. 24. It is looking to fill store associate, shift manager and manager trainee positions.

  4. Lightning owner Jeff Vinik backs film company pursuing global blockbusters

    Corporate

    TAMPA — Jeff Vinik's latest investment might be coming to a theater near you.

    Jeff Vinik, Tampa Bay Lightning owner, invested in a new movie company looking to appeal to a global audience. | [Times file photo]
  5. Trigaux: Look to new Inc. 5000 rankings for Tampa Bay's future heavyweights

    Business

    There's a whole lotta fast-growing private companies here in Tampa Bay. Odds are good you have not heard of most of them.

    Yet.

    Kyle Taylor, CEO and founder of The Penny Hoarder, fills a glass for his employees this past Wednesday as the young St. Petersburg personal advice business celebrates its landing at No. 25 on the 2017 Inc. 5000 list of the fastest growing private companies in the country. Taylor, still in his 20s, wins kudos from executive editor Alexis Grant for keeping the firm's culture innovative. The business ranked No. 32 last year. [DIRK SHADD   |   Times]