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Health subsidy for state retirees saved in budget talks

TALLAHASSEE — A second day of budget talks Tuesday produced at least one group of winners: retired public employees.

The House dropped its plan to save $224 million by eliminating a monthly health insurance subsidy for about 300,000 retired public employees — many of them politically influential former teachers, police officers and firefighters.

The plan to ax the health subsidy for retirees had enraged public employee unions and Democrats, who accused Republicans of breaking a pact with public workers. The idea also was seen as a veto target by Gov. Charlie Crist, who is relying on support from teachers in his uphill fight to win a U.S. Senate seat following his veto of an unpopular teacher pay bill.

"Certain retirement benefits promised to our committed public servants, including the right to have a health insurance subsidy, must be protected," said Rep. Kevin Ambler, R-Tampa. "Benefits promised and already earned by our retirees must be honored."

In bleak financial times, the Legislature has had to patch a $3.2 billion shortfall through an array of imaginative accounting steps, such as relying on money from Seminole Tribe slot machines and table games, another big infusion of federal economic stimulus money and the perennial raid on a road-building fund — $160 million in gas taxes paid by motorists to balance next year's budget.

That has led to such incongruous images as Senate President Jeff Atwater donning a reflective traffic vest at a road builders' rally at the Capitol on Tuesday, even though he agreed to raid the fund, a raid road builders say will stall highway construction and eliminate 11,000 jobs. (Lawmakers hope to restore $40 million of the raid with future federal money.)

"We have financial challenges we are working our way through," Atwater said. "So, yes, I'm responsible. In the end, I think … jobs could be at risk. So we didn't like it one bit."

In the health care budget, the biggest losers so far are hospitals and nursing homes, which face 7 percent cuts in reimbursement rates, for a savings of $615 million. In private, however, lawmakers are discussing whether to give deficit-ridden Jackson Memorial Hospital in Miami an extra $50 million.

Before they dangle that carrot before Jackson, lawmakers want assurances that the hospital will improve its governance structure and financial controls.

A couple of perennial issues in the health budget — caring for catastrophically sick and old people in the Medically Needy and Meds AD programs — have been spared the budget ax. But Rep. Denise Grimsley, R-Lake Placid, the House's health care budget chief, said she anticipates more cuts.

"We're going to get a little stingier," Grimsley said.

Among the unresolved budget issues: money for libraries next year. The Senate proposes $21 million, a level that qualifies for federal matching money. The House won't budge from its insistence that the money is better spent on job-creating tools to attract companies to relocate or expand in Florida.

Also in flux: funding for Florida Forever, the popular environmental land-buying program. The Senate budget has $15 million but the House has nothing, and the gap will likely be one of several decided by legislative leaders in the days ahead.

Some budget-related proposals simply never got off the ground this spring.

A state agency that has long been the target of a powerful lawmaker, the Department of Management Services, will stay intact for at least another year. It manages everything from state property to airplanes to employees' personnel records, but the House refused to go along with Sen. J.D. Alexander's proposal to break the agency apart and distribute its functions across other agencies.

Unresolved budget issues will be passed up the chain of command today to the two budget chairmen, Alexander and Rep. David Rivera, R-Miami. Whatever they can't resolve will be handed off to Atwater and House Speaker Larry Cretul on Saturday.

Times/Herald staff writers John Frank, Lee Logan, Robert Samuels and Cristina Silva contributed to this report. Steve Bousquet can be reached at bousquet@sptimes.com or (850) 224-7263.

Health subsidy for state retirees saved in budget talks 04/20/10 [Last modified: Tuesday, April 20, 2010 9:48pm]
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