Florida lawmakers convened in Tallahassee last month to kick off the 2016 legislative session, with today marking the midpoint of the 60-day work period. Members have stayed very busy over the past four weeks, with the House and Senate coming together to pass three comprehensive bills the first week of session. The legislation passed addresses issues relating to water and environmental policy, as well as educational and job opportunities for people with developmental disabilities – with the latter being the highest legislative priority of Senate President Andy Gardiner.
In addition, members began working early to craft a 2016-2017 state budget. While the state spending plan is normally addressed in the final weeks of session, House and Senate appropriations subcommittees presented their individual budgets late last month. The budget process is now in full swing, with members likely planning to go into budget conference next week.
Last year, the House and Senate ended session at odds over funding for state health care programs. That issue resulted in contention between the Legislature and the Governor as well, with the Governor vetoing more than $460 million in projects from the Legislature’s passed budget. Up to this point, this session has been much less rancorous than last year. While there are still many key policy and appropriations issues to be addressed, with this being an election year, members committed to establishing a better working relationship this session. There will be a number of differences to settle with regard to the budget, but legislative leaders indicate the two chambers are closer than in recent years. Members will also continue to address a number of controversial policy proposals regarding gun rights in Florida, as well as gaming issues, among other matters.
In December, Governor Scott released his $79.3 billion recommended budget for the coming year, which included increased funding for education and tax incentives. Job creation and economic development remain the Governor’s highest priorities. These will be addressed by the Legislature, but likely will not match the Governor’s recommendations.
Once the budget is finalized and passed and the session wraps up, as many as 15 of the 40 members of the Senate will depart the upper chamber of the Legislature. This is the largest number of Senators to leave the Senate since eight-year term limits were enacted in 1992. This large scale turnover, coupled with changes to Senate districts due to redistricting, has created a measure of uncertainty in the Florida Senate.
In addition, Florida’s presidential primary will take place on March 15th, with two prominent Floridians, Governor Bush and Senator Rubio, on the ballot. It will be interesting to see what, if any impact, this has on the session.
Last week the House and Senate approved and filed their respective full budget plans – which are currently around $1 billion apart. Both plans include record funding for education and focus on economic development – two items that meet the recommendations outlined in Governor Scott’s proposed budget. However, the funding methods for economic development programs and incentives differ greatly between the two chambers. While the Senate plan includes the Governor’s call for $250 million for incentives, the House’s $1 billion tax plan leaves the $250 million allocation out and focuses solely on cutting taxes.
One key budget issue this session will be House Speaker-designate Richard Corcoran’s proposal to significantly alter education funding in Florida by providing more state dollars for charter schools than the state’s PECO fund, which is used for building maintenance at the state’s public schools. Speaker-designate Corcoran has also indicated that he aims to reform the process for distributing capital outlay funding for schools. In addition, House Education Appropriations Chair Erik Fresen (R-Miami) has proposed spending caps for construction costs at schools, after it was discovered that funds were misspent in recent years. The House’s education budget includes $90 million in capital outlay funds for charter schools and $50 million for traditional public schools. The Senate proposal would fund $50 million for public schools but currently includes no funding for charter schools.
The House and Senate budgets for environmental programs are currently around $200 million apart. Both chambers have proposed funding for land acquisition, local parks, and Everglades cleanup, though the amounts differ between the two plans. In addition, both chambers provide around $50 million for water projects. With regard to transportation, the economic development and transportation proposals are currently around $800 million apart, although both chambers are spending roughly the same amounts on Florida’s transportation agencies and programs, including the FDOT Work Plan. For criminal justice and court funding, the two proposals differ on state court system spending, but are more similar on public safety funding.
The state health care budget, which caused so much controversy last session, appears to be much less contentious this session. The House plan is more in line with the Governor’s proposal with regard to state hospital funding, with the House reimbursing hospitals on a tiered system based on the amount of low-income and charity patients treated.
Taxes, Economic Development and Incentives
Economic development and incentive programs are key priorities for Governor Scott, Senate President Gardiner and Speaker Crisafulli. In his budget recommendations released late last year, Governor Scott proposed $1 billion in tax cuts and $250 million for economic incentive programs to draw companies to Florida. The Governor’s proposal includes a permanent elimination of the manufacturing equipment tax, as well as the creation and extension of several sales tax holidays. In addition, the Governor called for a permanent repeal of Florida’s corporate income tax as well as a cut of the state’s current six percent commercial real estate tax by one percent.
The Senate budget plan meets the Governor’s request for a $250 million pot of economic incentives funding, but would fund $100 million with dollars tied to the latest Gulf oil spill settlement money. The current House budget includes no money for incentives. However, House members are considering a $1 billion tax cut package. The House plan relies on $700 million in single-year tax breaks. The proposal makes no reductions to the state’s corporate income tax, but does cut taxes on commercial leases, as recommended by Governor Scott.
On the Senate side, members are considering legislation to make permanent the state’s sales tax exemption on certain manufacturing equipment and machinery, which is currently set to expire in 2017. The Senate has indicated that it currently does not plan to support a comprehensive tax cut package, but has expressed a possible willingness to address issues relating to property taxes resulting from increasing property revenues in the state.
The topic of potentially expanding gaming in Florida has been debated by lawmakers for the past several years, but measures have ultimately failed to pass through the legislative process. Depending on how proposed changes are received going forward, gaming could again become one of the more contentious issues this session.
Gaming proposals have been filed in both the House and Senate, with the House bill heard in committee yesterday. The proposals include language regarding a deal recently reached between Governor Scott and the Seminole Tribe of Florida. The agreement would allow the Seminoles to add craps and roulette at each of the tribe’s seven Florida casinos. The Seminoles will in turn pay the state $3 billion over seven years.
The House gaming legislation would overhaul the state industry and allow for additional slot machines in Miami-Dade and Palm Beach Counties, among other provisions. The House proposal would also “decouple” dog racing and some horse racing, no longer requiring card rooms and certain other gaming facilities to hold live races. The Senate proposals were also scheduled to be heard in committee yesterday, but Senate Regulated Industries Chair Rob Bradley (R-Orange Park) decided to postpone the bills until next week so that members can properly consider amendments.
While House members may be more amendable to gaming legislation, the issue is more uncertain in the Senate, where there is little appetite for expansion of gaming in any form.
Education policy and appropriations issues remain key priorities for state lawmakers. In recent years, legislators and the Governor have provided record funding amounts for Florida’s K-12 programs and facilities, but there has been significant debate surrounding standardized testing in the state’s K-12 schools. Lawmakers continue to address the issue this session, with Senate Education Appropriations Chair Don Gaetz (R-Destin) proposing a measure to give school districts the option of choosing national tests – the ACT or SAT – instead of the state’s standardized test.
There are also a number of other legislative proposals on the table this session, including a bill aiming to potentially overhaul how public schools are locally governed in Florida. House lawmakers are considering a proposed constitutional amendment that would allow for citywide school districts, instead of the current countywide governance system. In addition, the Senate is considering a proposal to return the state Education Commissioner to an elected rather than appointed position.
One key issue this session relating to education would address the state’s K-12 charter schools. Lawmakers are considering measures to limit the amount of control local school districts have over charter schools. In addition, the House Appropriations Committee approved a measure that would require school districts to use property tax revenues to boost charter school funding.
On the Senate side, Education Budget Chair Gaetz has discussed funding for the state’s “Best and Brightest” teacher bonus pay program. At this time, there is no funding for the program in the Senate budget. Chair Gaetz has expressed that the chamber wants to vet the program more properly before committing funding.
With regard to higher education, most discussions at this time focus on funding. The Senate budget proposal provides more than $7 billion for higher education, including $4.6 billion for public universities and $1.2 billion for state colleges. The House higher education budget provides $4.7 billion for state universities and $1.2 billion for state colleges.
On the funding side for K-12 schools, the Senate proposal for funding methods currently differs significantly from Governor Scott’s plan. The Governor’s education budget relies primarily on higher property taxes, while Chair Gaetz wants to fund education programs with state tax revenues instead.
Last year’s regular session was one of the most contentious in recent memory, all surrounding the federal government’s decision to discontinue LIP funding and the Legislature’s response to that decision. The issue caused a complete breakdown in negotiations between the House and Senate, as well as tension between the Legislature and the Governor’s office.
This session, members will again address the LIP program, which provides funding for hospitals to care for low-income and uninsured patients. Federal officials announced $608 million in funding for the program in the 2016-17 budget – down from $1 billion in the current budget. Currently, the Senate health budget would fully reimburse hospitals that see the most charity care patients, with tiered reimbursements for others. The House proposal also uses a three-tier system for hospital reimbursement. Going forward, members have decided to steer clear of any proposals to expand health care coverage for uninsured patients in Florida.
On the policy end, members are considering key measures in both chambers that aim to make the costs of health care at Florida’s hospitals more transparent. The issue has been pushed by Governor Scott, who wants to address what he calls “price gouging” at hospitals in the state. The Governor also pushed for $5 million in funding for the development of an all claims payer database. The measures filed by Representative Chris Sprowls (R-Clearwater) in the House and Senator Rob Bradley (R-Orange Park) in the Senate, are currently moving through the legislative process. The current House plan would require contracting for the database which would allow patients to search for information about the prices and quality of care available. In addition, members are again considering legislation relating to telehealth this session, which would allow doctors to remotely provide care to patients.
Members are also considering legislation to eliminate the “certificate of need” process for new or expanded hospitals, as well as a measure to allow ambulatory surgery centers in Florida to hold patients for up to 24 hours.
In addition, the medical marijuana issue continues in Florida, as both chambers are considering measures to broaden the types of marijuana that are available to certain patients and add marijuana to the list of experimental drugs that terminal patients are allowed to use. Florida voters will again see this issue as a proposed constitutional amendment on the 2016 ballot.
In other health care issues, Senator Aaron Bean (R-Jacksonville) filed legislation for consideration this session that would allow public and private schools to buy epinephrine auto-injectors to treat emergency allergy reactions directly from manufacturers at free or reduced costs. This legislation is sponsored by Representative Dane Eagle (R-Cape Coral) in the House and is currently moving through the session process.
Energy and Environmental Policy
While last session was predicted to be Florida’s “Year of Water,” the fighting between the House and Senate and contentious end to the session resulted in the lack of passage of a number of comprehensive environment, land and water bills. However, this year lawmakers kicked off the first week of session by passing major water policy legislation mirroring the bill that failed last year. The bill has already been signed into law by Governor Scott. The new measure establishes a timetable for actions by the state to protect springs, revise permitting for Lake Okeechobee projects and establish regulatory standards for water use permitting and planning in Central Florida.
Lawmakers have also spent a considerable amount of time this session working on legislation relating to oil and gas resources in the state. The measure has already passed through the House and makes a number of changes to the state’s Oil and Gas Program. The stated goal of the legislation is to make the process of high pressure well-stimulation safer for the conservation of oil and gas resources. At this time, the Senate version of the bill still needs to be heard by the Senate Appropriations Committee.
In addition, members of the Senate Finance and Tax Committee are supporting legislation to make Florida’s renewable energy production tax credit permanent and increase the annual cap on total credits from $10 million to $15 million per year.
Criminal Justice and Public Safety
Lawmakers are addressing a number of issues relating to law enforcement, criminal justice and public safety this session. Key among these issues are controversial measures relating to gun rights and laws in the state. The two main proposals focus on “open carry” and “campus carry.” The House has spent a considerable amount of time working on these measures this session, with both passing the House floor after extensive discussion and debate. The “campus carry” bill would allow Floridians with concealed-weapons permits to carry their weapons onto Florida’s college and university campuses. The “open carry” measure will allow those with concealed-weapons licenses to openly carry their guns in holsters, cases or bags. At this time it appears unlikely that these measures will be supported by the Senate.
Lawmakers are also considering other legislation relating to law enforcement and public safety, including a measure regarding jury counts and decisions in death penalty cases. At this time, the House and Senate do not concur on how best to address this issue. In addition, legislation is moving in the Senate to change state law so that aggravated assault convictions will no longer carry a minimum 10-year sentence.
Transportation and Infrastructure
Each session the House and Senate transportation committees put forth their respective legislative packages, which include priorities outlined by the Florida Department of Transportation (“FDOT”) for the year. These bills are typically heavily debated and amended throughout session. Due to the weighty amendment process for these proposals, often late in session, if passed, the bills usually do not receive final approval until the last hours of session. At this time, both the House and Senate transportation bills would, among other provisions, increase the minimum amount of funding FDOT must provide the Florida Seaport Transportation and Economic Development Council (FSTED) annually to $25 million. One key component of both proposals is the creation of a new DOT Financing Corporation that could issue bonds for some projects on FDOT’s behalf. In addition, the legislation allows FDOT to assume some responsibilities currently handled by the federal government with regard to environmental policy.
Another key issue moving through the Legislature this session aims to address transportation network companies in Florida. Companies such as Uber and Lyft are pushing a measure to preempt local laws, which prevent transportation network companies from operating in many municipalities.
There is much to be decided and much at stake in the Legislature in the coming weeks, with the state budget and a number of key controversial issues up for discussion. Members will continue in the coming days and weeks to address filed legislation and craft amendments to bills addressing various issues.
With the budget process already underway, members should be set to adjourn session by the scheduled deadline – Friday, March 11th.