TALLAHASSEE -- Property tax breaks, unemployment compensation, corporate incentives and a revenue cap proposal favored by the Senate president will be among a handful of high priority fiscal items to be addressed by the House, the chamber’s top finance and tax leader expects.
Speaking to members who met for the first time since being sworn in, House Finance and Tax Committee chairman Rep. Steve Precourt, R-Orlando, said last week that details of those issues will likely not be available until at least next month as Gov. Rick Scott and Senate President Mike Haridopolos fine tune their priorities in preparation of the 2011 Legislative session.
In addition, Precourt said the committee plans to delve deeply into the issue of special taxing districts, the apparent proliferation of which has attracted the attention of House lawmakers who say such entities that often fall outside the jurisdiction of other branches of government. But for now, Precourt said all the committee can do is wait.
The first major deadline comes Feb. 4, when Scott is expected to release his budget proposal to lawmakers. Expected to be included in the package are details on Scott’s campaign promise to lower property taxes and phase out the state’s corporate income tax, pledges that will cost the state billions in lost revenue while they already face a $3.5 billion budget hole.
Scott’s corporate income tax proposal will also have an impact on the state’s scholarship program that allows corporations to receive tax credits for providing educational scholarships. Last year, the program cost the state about $120 million in lost revenue.
Among items expected to come before the House include the issue of unemployment compensation: The prolonged recession has caused the state to exhaust its reserves to pay jobless benefits. Florida now owes the federal government $1.8 billion which must be repaid. Meanwhile, small business owners especially have been smacked by higher unemployment tax payments that in some cases tripled Jan. 1.
Among proposals being floated would be to raise the 5.6 percent cap on unemployment compensation premiums or raising the rate for targeted industries such as construction, which puts in far less into the system then it takes out. Lawmakers may also review existing state law that business groups say unfairly favors workers in unemployment disputes.
Revenue caps will also be a hot topic. A Haridopolos priority, the concept of capping state and local revenue growth is expected to be on the front burning over the next two years. The Senate president wants to tie local revenue increases more closely to inflation and growth. Haridopolos has long argued that local governments took advantage during the state‘s boom years to increase spending faster than population growth dictates. Despite being on the other end of the business cycle, local governments will again be a target for the Senate president.
Historically routine issues may attract greater attention during the upcoming session. For example, lawmakers usually approve a bill every year to comply with changes in federal tax law. Known as piggybacking, the measures usually cause little stir.
This year, however, tax changes brought on by the federal reform package will reduce the revenue stream to the state by bolstering tax breaks for certain filers. State lawmakers may decide to decouple the state from the federal law to limit the impact on state revenues, though decoupling would likely reduce the tax benefits to consumers of the federal stimulus package.