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Business Observer Sunday, Mar. 4, 2012 6 years ago

Capitol Chatter: March 2

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The Legislature moved closer to addressing tax cuts and the foreclosure process, while also showing lobbyists hold favor.
by: Rod Thomson Staff Writer

Tangible tax cut and back-slapping fun
It's not often that a tax cut that is good for small businesses but costs local governments revenue becomes a love fest in committee from all sides, but such was the happy case for Sen. Nancy Detert, R-Venice.

It was an earned moment.

Detert sponsored a bill to place a constitutional amendment before voters that would double the exemption for tangible property from $25,000 to $50,000. The tangible tax is one of those groaners for any business, because it keeps taxing the same chairs, desks, computers and other things every year despite all the taxes already paid when purchased. Businesses hate it on the face, but also because it requires a load of time-consuming paperwork.

But there was considerable opposition to the initial proposal. So Detert worked with all the local government lobbying groups in Tallahassee — the Florida League of Cities, the Florida Association of Counties and so on — plus all the business lobbying groups to get everyone onboard.

The amendment, if voters approve it, would also allow local municipalities to increase the exemption further in their area as part of an economic development strategy. The amendment would save small businesses about $20 million statewide, but maybe more importantly, it would affect about half of all businesses in the state -- about 150,000 — making it also a red-tape-reduction act.

“It's not the amount of the tax, but the annoyance of filling out all the paperwork,” said Detert, who owned a small mortgage company in Venice for more than 25 years.

The bill passed out of the Senate Budget Subcommittee on Finance and Tax unanimously, and speaker after speaker from business and government interests lauded Detert and Gov. Rick Scott for finding a path that worked for everyone.

Mr. Swier goes to Tallahassee, and gets dissed for his efforts
Rich Swier Sr. is a conservative blogger for redcounty.com in Sarasota and active in veterans affairs and local politics, albeit not as a politician.

He showed up in Tallahassee recently as a concerned citizen to testify before the House Subcommittee on PreK-12 Appropriations, looking for equal funding for charter schools and asking the lawmakers not to further indebt his two grandchildren.

But he was repeatedly interrupted by the chairwoman of the subcommittee, Rep. Marti Coley, R-Marianna, who asked him to stay specifically on the bill and not to talk about other committees or lawmakers.

“Do not reference individuals,” she admonished him at least twice.

What? She did not explain herself except that one of the lawmakers on her panel complained to her. Golly, really?

So Swier drove 10 hours to Tallahassee and back and got three minutes of interrupted and marginalized testimony. He didn't complain to Coley, and even apologized for offending anyone. It's just that nothing he said appeared offensive on the surface. He just perhaps did not know the unwritten rules of how insiders play at committee meetings.

Several well-known lobbyists for education groups spoke and none was interrupted, except to be asked questions and have their time extended. They are carefully respected and get plenty of open doors beyond public committee meetings.

Meanwhile, as other parents testified, lawmakers on the panel left temporarily to attend other business or held side conversations among themselves. It got so bad that Coley chastised them to give the speakers their full attention.

It is this sort of behavior that makes people feel like the game is rigged for special interests and the insiders. Regular folks need not make the trip — unless they are under the umbrella of an established lobbying group.

Palace intrigue for Senate president
The line of succession to lead the Senate is going right through the rift already apparent in the Republican Party on a national level.

The Senate has been run in the most recent years by the more conservative portion of the party. That is expected to remain the same next year when Sen. Don Gaetz, R-Destin, takes the gavel.

But after that, when there is normally an accepted structure in place for the next several years, there is now a brouhaha. And it is philosophic, at least to a degree.

Sen. Andy Gardiner, R-Orlando, a solid conservative, was set to be crowned for 2014. But a challenge has arisen from Sen. Jack Latvala, R-St. Petersburg, being pushed by the more moderate wing of the party.

This is more important than an ego trip. It sets up a battle between Republican conservatives and Republican moderates -- or more old-line establishment Republicans — and that will set the tone for coming years in the Senate.

And that has real meaning for what gets passed. A more moderate leadership would likely put brakes on some of the changes that Gov. Scott believes are necessary to make Florida the most attractive state for businesses, and hence, jobs.

Foreclosure speed up causes testimony flare up
Legislators want to unclog the legal system and the housing market by quickening the cumbersome foreclosure process. In the process, they are speeding up the lengthy legislative process and ticking off some homeowners.

The bill, which might have stronger support but for its late introduction and abbreviated hearings, is backed by banks, builders and other business interests.

The idea is to target about 30% of foreclosed houses that are abandoned. Empty houses in legal no-man's-land deteriorate, are vandalism-prone and drag down real estate values in neighborhoods. By clearing out those foreclosure properties, the real estate sector can set itself right and spur the broader economy.

The bill makes it easier and faster to foreclose on abandoned properties and puts limits on damages in foreclosure cases. Conversely, the bill also reduces the length of time a bank can go after a borrower after a foreclosure sale from five years to one year — which is a break for consumers.

The bill passed the Senate Judiciary Committee 5-0, but only squeaked past the Senate Banking and Insurance Committee 6-4 after committee Chairman Garrett Richter, R-Naples, ended public testimony part way through. The caused angry shouts from homeowners who didn't get to testify after driving several hours to appear and grumbles from some Republicans who think the bill is too complicated to move so fast.

The reason for the quickness is to reflect a combination of bills moving through the House. The original Senate version was gutted and a substitute was inserted with different language to mirror the House bills.

'Hired guns' need not apply
Being an expert witness to present testimony in court just became harder — good for most businesses, bad for most trial lawyers — after the House voted 77-34 to upgrade the standard.

Expert witnesses are brought in by lawyers to explain why their client should prevail based on detailed information. But they must meet a minimum standard that a judge can apply to determine if their testimony is trustworthy.

Business organizations want the standard that is more broadly accepted nationally -- known as “Daubert” -- because it will get rid of what many call “junk science” that is allowed under the current law, known as the “Frye” standard.

The Frye standard has resulted in businesses being forced to make huge payouts and given the state a reputation as an easy place to sue companies, proponents of the bill say. A Harris Interactive Poll ranked Florida 42nd in the nation in legal climate for businesses — not something that thrills state leaders.

The changes are being fought by the Florida Justice Association, the state's trial lawyers group, and Democrats.

The Senate version has cleared one committee and is now in the Budget Committee before heading to the floor.

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