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Crist disavows letters opposing tax swap

TALLAHASSEE — Gov. Charlie Crist said his aide got it wrong six months ago when he wrote constituents to say the governor would oppose any plans to swap property tax cuts for other tax increases.

Such a position would conflict with Crist's newfound pledge to back Amendment 5, a measure on November's ballot that proposes just such a tax swap.

"He didn't talk to me first," Crist said Wednesday of his chief economist, Christian Weiss. On the governor's behalf, Weiss sent more than a dozen letters saying Crist opposes repeal of tax exemptions or an increase in the sales tax, even if the revenue is used to offset a property tax cut.

Amendment 5 would repeal most property taxes for schools but would require the Legislature to raise $9-billion to $11-billion annually in replacement revenue.

Crist's spokeswoman, Erin Isaac, said Weiss drafted the letter and it was approved by Weiss' boss, budget director Jerry McDaniel, one of Crist's most trusted aides. McDaniel also worked for Crist when he was attorney general.

Weiss' letter is dated Feb. 28, a point just before the last legislative session began, when Crist and McDaniel would have been in close communication.

Crist's comments criticizing a subordinate Wednesday were rare. Crist frequently showers state employees with praise. At a minimum, the episode revealed a breakdown in communication between Crist and his senior staff.

Crist has yet to say, however, where he would propose the Legislature find the billions to pay for a major shift in Florida tax policy that is counter to his rigid and long-standing opposition to tax increases.

"Time will tell," Crist said. "I am an optimist, as you know. Some have suggested there might be some assistance from a sales tax, but that's up to the people to decide."

Crist said the Legislature should thoroughly review sales tax exemptions, which mainly favor businesses. Florida exempts hundreds of goods and services from taxation, from bottled water to charter fishing trips to livestock feed.

But a state analysis shows eliminating all exemptions except for groceries, electricity, medicine and rent would provide less than half of the $10-million that would be needed annually for school funding. Another $4-billion likely would come from a 1-cent increase to the state's 6-cent sales tax, but both ideas face strong resistance in a Republican-controlled Legislature.

The Florida Chamber of Commerce, which opposes Amendment 5, agrees a case-by-case review of tax exemptions is long overdue. What the chamber and its allies oppose is a wholesale elimination of exemptions, which it considers disruptive to tax-code stability.

"I'm sure there are some exemptions whose time has moved on," chamber lobbyist David Daniel said.

Crist's decision to get behind the tax swap shapes up as a major test of his popularity in an election year when he is also the top campaigner in Florida for John McCain's presidential bid. A poll released this week that was underwritten by the chamber showed voters were split 40 percent to 40 percent on the amendment, with 20 percent undecided. Proposed amendments to the state Constitution need 60 percent approval to be adopted.

It is already forcing opponents to intensify their fundraising and their rhetoric. On Wednesday, the Florida Life Care Residents Association, representing 14,000 residents in continuing-care retirement homes in the Tallahassee area, voiced "alarm" at what it called Crist's "support for sales tax increases" that will hurt senior citizens on fixed incomes.

But to Crist, the simple beauty of Amendment 5 is that the people make the call.

"No. 1, we have to see what the people want, and that doesn't happen till November," Crist said as he completed a disaster preparedness exercise Wednesday. "Let's not prejudge the people and their wisdom."

Crist disavows letters opposing tax swap 08/06/08 [Last modified: Friday, August 8, 2008 8:09pm]
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