Florida Government and Politics Weekly Update

11 May 2009 Publication

Public Affairs News Alert

State Budget: Legislative Session Ends With Budget Agreement
On May 8, 2009, the Florida Legislature ended its regular legislative session with the adoption of a $66.5 billion budget for the fiscal year beginning July 1, 2009.

The 2009 – 2010 budget represents an increase over the previous year’s budget. The 2008 – 2009 budget was $66.2 billion when it passed the Legislature, but it was cut by approximately $1.2 billion in a January 2009 special legislative session that was called in response to declining state revenues. Florida’s spending peaked in fiscal year 2007 – 2008, with a $72.0 billion state budget.

The budget for 2009 – 2010 increases funding for education and health care and decreases funding for transportation and governmental operations. More specifically:

  • The budget increases funding for all sectors of education, funding Pre-K – 12 education at $13.4 billion (a 14.5 percent increase over the prior year), state universities at $4.1 billion (a 1.6 percent increase), and community and state colleges at $2.6 billion (a 5.2 percent increase).
  • Spending in the area of health and human services is increased by $2.7 billion, but some areas, including Medicaid reimbursements, were reduced.
  • The budget includes $9.7 billion of transportation spending, which represents a 4.5 percent decrease from the 2008 – 2009 budget.
  • The budget includes $1.7 billion in spending for governmental operations, a reduction of 4.3 percent from the prior year. The reduction includes a two-percent pay cut for approximately 28,000 state employees who make more than $45,000 a year.

The budget also includes reserves of $1.7 billion, which are expected to address concerns about the state’s bond ratings and provide a cushion in the event of further weakening in the economy.

In order to balance the budget, the Legislature enacted several revenue increases, including:

  • Tobacco surcharges, including a $1 per pack increase in cigarette taxes and tax increases on some other forms of tobacco, but not on cigars. These increases are expected to generate $900 million in new revenue.
  • Fee increases on drivers and vehicles, which are expected to produce $800 million in new revenues, and increases in court fees, which are expected to produce $227 million.
  • An eight-percent increase in tuition for state universities, colleges, and community colleges. State universities also were given the discretion to add another seven percent to their tuition increases.

Gaming: Legislature Approves Plan for Seminole Gaming and Expansion of Pari-Mutuels
Resolving the most contentious issue of the session, the Legislature also approved a plan for a new gaming compact with the Seminole Tribe of Florida and expansion of gaming at pari-mutuel facilities.

Senate Bill 788 provides for the governor and the Seminole Tribe to negotiate a new 15-year compact by August 31, 2009, which would be subject to ratification by the Legislature. The new compact would give the tribe exclusive rights to operate Las Vegas-style slot machines (known as Class III slot machines) outside of Broward and Miami-Dade counties and would give the tribe exclusive rights to operate blackjack and other banked card games, but these games would be limited to tribe facilities in Broward and Hillsborough counties. The tribe also would be able to operate no-limit poker games at all of its facilities.

In exchange, the tribe would be required to provide the state with a share of its gaming revenue. The bill provides a sliding scale ranging from 12 percent to 25 percent of the tribe’s “net win,” with a minimum payment to the state of $150 million a year.

The bill also provides benefits that are intended to help pari-mutuel facilities cope with the increased competition from Seminole gaming, including tax reductions, authorization for no-limit poker at card rooms, increased hours for card rooms, Class III slot machines at pari-mutuel facilities in Broward and Miami-Dade counties, conversion of jai-alai permits to dog racing permits, and authorization to convert quarter horse permits into limited thoroughbred permits.

Politics: Governor Crist Expected to Announce Candidacy for the U.S. Senate
On Tuesday, May 12, 2009, Gov. Charlie Crist is expected to announce that he intends to run for the U.S. Senate in 2010. Sen. Mel Martinez, whose term expires in 2010, has previously announced that he does not intend to seek reelection.

One of Gov. Crist’s closest political allies, Republican Party of Florida Chair Jim Greer, told reporters on May 10, 2009 that Gov. Crist will make his announcement on May 12, 2009 and added, “I think Charlie Crist will be the next U.S. Senator.” Mr. Greer said, “I believe that Charlie Crist has concluded that the problems and issues that Floridians are facing — high unemployment and the economy — can’t be solved in Tallahassee, they need to be solved in Washington and I believe that’s what he’s going to do.”

On May 5, 2009, former state House Speaker Marco Rubio (R-West Miami) announced that he was running for the Senate seat, setting up a primary fight with Gov. Crist.

The announced Democratic candidates for the Senate are U.S. Rep. Kendrick Meek (D-17th Congressional District) and state Sen. Dan Gelber (D-Miami Beach).

Gov. Crist’s long-anticipated decision not to seek reelection is expected to touch off a series of highly competitive races for statewide office. The expected Republican contenders for governor include State Attorney General Bill McCollum and Florida Department of Agriculture and Consumer Services Commissioner Charles H. Bronson. State Chief Financial Officer Alex Sink is expected to be the dominant Democratic candidate for governor.

The presence of Messrs. Bronson, McCollum, and Ms. Sink in the gubernatorial contest would create open races for the three statewide elective offices that they currently hold. Announced candidates for agriculture commissioner include U.S. Rep. Adam Putnam (R-12th Congressional District) and state Sen. Carey Baker (R-Eustis). Possible candidates for attorney general include former state Sen. Rod Smith (D-Alachua), state Sen. Dave Aronberg (D-Greenacres), and state Rep. Tom Grady (R-Naples). State Senate President Jeff Atwater (R-North Palm Beach) has been widely mentioned as a potential candidate for chief financial officer.

 


Public Affairs News Alert is part of our ongoing commitment to providing up-to-the-minute information about pressing concerns or industry issues affecting our clients and our colleagues. If you have any questions about this alert or would like to discuss these topics further, please contact your Foley attorney or any of the following individuals:

 

Marnie George
Tallahassee, Florida
850.513.3398
marnie@thegeorgegroup.com

Michael P. Harrell
Tallahassee, Florida
850.513.3373
mharrell@foley.com

Robert H. Hosay
Tallahassee, Florida
850.513.3382
rhosay@foley.com

Jonathan P. Kilman
Orlando, Florida
407.244.3256
jkilman@foley.com

Thomas J. Maida
Tallahassee, Florida
850.513.3377
tmaida@foley.com

Leonard E. Schulte
Tallahassee, Florida
850.513.3380
lschulte@foley.com

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