Make us your home page

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

  1. Tampa is 15th-most popular city to move to with U-Haul


    TAMPA —Tampa is undoubtedly a destination point, at least according to U-Haul.

    Tampa is the No. 15 destination for people moving with U-Haul trucks. | Times file photo
  2. Florida's economy growing faster than other big states and far better than U.S. overall


    When it comes to economic growth, Florida's running alongside the leading states and well ahead of the United States as a whole.

  3. Westshore Marina District project takes shape with another acquisition

    Real Estate

    TAMPA — One of Tampa Bay's prime waterfront areas took another major step toward redevelopment Friday as WCI Communities bought 2.35 acres in Westshore Marina District.

    WCI Communities, Lennar's high-end subsidiary,has paid $2.5 million for 2.35 acres in the Westshore Marina District for 35 townhomes. WCI is under contract  to buy an additional 9.5 acres.
[BTI Partners]
  4. Posh Guy Harvey RV park to open in Tampa Bay with $250,000 cottages


    HOLIDAY — Love those Guy Harvey T-shirts with the soaring marlins? In the not too distant future, you might be able to kick back in your own Guy Harvey cottage in the first-ever Guy Harvey RV park.

    Renderings of the clubhouse and an RV cottage site of the planned Guy Harvey Outpost Club & Resort Tarpon Springs.
[Guy Harvey Outpost Collection]
  5. Port Tampa Bay secures $9 million grant to deepen Big Bend Channel


    Port Tampa Bay has secured a $9 million grant from the U.S. Army Corps of Engineers for the widening and deepening of the Big Bend Channel in southern Hillsborough County.