1. Florida Politics

Florida House passes $690 million tax cut package

Published Apr. 9, 2015

TALLAHASSEE — Cellphone users, widows and widowers, college students and small businesses are among the latest pawns in a showdown over Medicaid expansion in Florida.

On Thursday, the Florida House overwhelmingly passed a $690 million tax cut package that could save those groups money, but only if the Senate signs off on the plan.

Senate leaders say that won't happen as long as negotiations remain stalled between the state and federal government over a $2.2 billion program that helps hospitals treat low income patients. In a compromise with the federal government, the Senate is proposing to restore those funds by expanding Medicaid, an idea that House Republicans oppose.

Instead, the House in a 112-3 vote is proposing tax cuts that closely resemble those proposed by Gov. Rick Scott, further solidifying their sudden alliance in opposing Medicaid expansion while further isolating the Senate.

"We are focused on tax cuts and not expanding Medicaid so that's where we are and that's the posture we're in," said House Speaker Steve Crisafulli, R-Merritt Island on Wednesday. "It would be hard for me to say no to ($690 million in tax cuts) as a Republican. I'm sure it was hard for them to say yes to Medicaid expansion."

Senate President Andy Gardiner said Wednesday that Senators are ready to cut taxes by more than $800 million, but only if Florida gets back $2.2 billion in Low Income Pool (LIP) funding, the federal program to help hospitals treat poor patients.

"You've got a LIP issue, you have questions regarding (the U.S. Centers for Medicare and Medicaid Services)," Gardiner said. "We hoped we could move forward, but that's a big hole, so we'll just have to wait and see. But the Senate has put itself in a position where we have the tax cuts ready and ultimately we'll have a discussion and go from there."

Relations between the two chambers seem to be disintegrating. Last week, House Appropriations Chair Richard Corcoran, R-Land O'Lakes, said he would go to war against unnamed special interests before expanding Medicaid.

"Come to war with us," Corcoran told House members during a fiery speech in support of the House's $76.2 billion budget. "I'll fight. And if it costs me my political career or yours, so be it."

Gardiner scoffed at those comments.

"We're all adults here," he said Wednesday. "We're not going to war. This is a policy debate between individuals. War is, go talk to Sen. Garrett Richter who went to Vietnam at 18 or 19 years old and was a tunnel rat. That's war. This is a policy debate. This is a policy discussion. "

Gardiner reiterated that he didn't want to "point fingers," but wanted to have a dialogue. "At the end of the day, it's not about who wins and loses. It's about, when you go home, if hospitals are going to absolutely see significant rate cuts because LIP's not there, then everybody needs to understand that before this budget passes."

The Senate's proposed budget is $4 billion more than the House budget with only three weeks to go in the session, and the tax cut debate makes it even harder for the two chambers to reach consensus.

Two years after endorsing Medicaid expansion, Scott reversed himself this week indicating he had concerns with it, specifically with trusting that federal funds would keep flowing. In further alliance with the House, he reiterated support for the tax cuts without explaining how to pay for them without the LIP funding.

"When we finish the session, I predict we'll have the highest funding for K-12 education, we'll have $673 million in tax cuts and our colleges will be more affordable," Scott said on Wednesday, offering no predictions about the $2.2 billion in missing LIP funding.

Asked if he'd veto the budget if his tax cuts weren't included, Scott replied: "It's not my tax cuts. It's tax cuts for the citizens of the state. I'm confident they will be in there."

The Florida House's proposed tax cut package is about $17 million more than Scott's proposed plan. A cut in the state's communications services tax of 3.6 percent make up the bulk of both plans.

Assembled by the chairman of the Finance & Taxation Committee, Rep. Matt Gaetz, R-Fort Walton Beach, the House package is a medley of tax cuts for various groups where a no vote could provide fodder for a political attack ad in a future campaign.

Gaetz described the package as helping working-class Floridians. Those eligible for cuts include small businesses, college students, military veterans, farmers, gun clubs, school volunteers, high-tech research, widowed and disabled homeowners.

"Do we want college students, who often are taking out loans, or calling home for book money, to pay more or less for their instructional materials," Gaetz said. "It wouldn't make much sense not to cut taxes on the disabled in order to help them. We increase the tax exemption for disabled people from $500 to $5,000, so if you push the (no) button, you are pushing for disabled people to pay more in taxes."

But Democratic Minority Leader Mark Pafford of West Palm Beach said the tax cuts weren't an equitable trade for all the lost revenue.

Pafford said the wait list for seniors seeking homecare is about 50,000. There are another 20,000 disabled people waiting for assistance. Another 60,000 children await early-learning programs. More wait for long term care and other critical needs.

"It's really nice to celebrate tax breaks," Pafford said. "But this doesn't amount to a lot when you weigh the need and desperation in Florida that we're just not addressing year after year after year.

But Pafford was joined in dissent by only two other Democrats, Joseph Geller of Aventura and Kristin Jacobs of Coconut Creek.

Rep. Ed Narain of Tampa, one of 32 Democrats to support the cuts, said they would encourage economic growth and savings for families.

"This is about the future," Narain said.

The package now heads to the Senate.

Contact Michael Van Sickler at Follow @mikevansickler.


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