Tallahassee will be abuzz in early 2019 with a new Florida first family. Some priorities, echoing outgoing Gov. Rick Scott, could be a boost for businesses.
Behind the first new governor since 2010 in Gov.-elect Ron DeSantis, the list of priorities coming out of Tallahassee for 2019 is both long and wide.
The list include: tort reform, manufacturing zoning and siting, reducing the 4.92% communications services tax, modernizing a pension system that costs taxpayers $1 billion a year, and recruiting high-wage employers while attracting capital investment.
Nine other business issues on the list for Tallahassee when lawmakers convene in March include:
• Red tide: The economic impact of the prolonged red tide bloom that befouled a 150-mile span of coastal Southwest Florida is difficult to measure, though it tops billions of dollars. In his 11-point environmental plan, DeSantis says he’ll create a task force to research what exacerbates red tide blooms and triggers Lake Okeechobee’s blue-green algae. DeSantis vows red tide and blue algae will be a 2019 priority. Legislators say they’re ready to act.
• Corporate tax cut: Florida's 5.5% corporate income tax rate is the nation’s fifth lowest, generating $2.5 billion annually. During the gubernatorial campaign, DeSantis called for a reduction to 5%, which would return more than $220 million a year to Florida businesses.
• Business rental tax: Florida is the only state that levies a sales tax on commercial leases, the business rent tax. The state’s Revenue Department estimates 150,000 businesses will pay $2 billion in BRT this year. In 2017, legislators lowered the BRT from 6 to 5.8%. In 2018, it was trimmed to 5.7%. Legislators will seek to accelerate its phase-out or eliminate it.
• Vacation rentals: This preemption turf war will again pit state lawmakers against local governments as the $31 billion short-term rental industry created by industry disruptors such as Airbnb, VRBO and HomeAway continues to grow. Several failed 2018 bills proposed removing short-term vacation rentals from a patchwork of local hotel and motel regulations and establishing statewide regulations administered by the Department of Business and Professional Regulation.
• AOB reform: Florida allows homeowners to assign insurance benefits to contractors after a loss to pursue payment from insurers for “upfront” work. But state officials say a “one-way” attorney fee provision in the assignment of benefit statute spurs lawsuits, driving up property insurance rates. Bills amending or eliminating the provision have failed six straight years. At least one 2019 AOB reform bill has been pre-filed.
• Occupational licensing reform: Nearly 30% of occupations in Florida require licensing, the fourth-highest percentage in the country. The appointment of “deregulation champion” Rep. Halsey Beshears as secretary of the Department of Business and Professional Regulation assures reducing administrative burdens on small business and entrepreneurs will be an emphasis.
• Workers’ compensation: Florida’s workers’ compensation rates will decline again in 2019, but many fear repercussions from two recent lawsuits presage rate hikes in 2020 and beyond. Senate President Bill Galvano, R-Bradenton, says the state’s workers’ compensation program will be “looked at” during the legislative session. Florida TaxWatch suggests legislators consider adopting an independent medical review system similar to the one implemented by California.
• Beach access: A 2018 law that created a process for local governments to adopt ordinances ensuring customary use of beach areas above mean high-water lines, including requiring judicial approval, has been a source of confusion, lawsuits and confrontations. Sen. Darryl Rouson, D-St. Petersburg, has pre-filed a bill calling for its repeal and to redefine ‘recreational customary use.’
• High-tech economic development: Florida lawmakers will again focus on the ‘economy of tomorrow’ with statewide 5G cellphone service, smart cities, smart infrastructure, autonomous vehicles, artificial intelligence already discussed in pre-session primers. Florida Polytechnic University’s $42 million SunTrax autonomous vehicle testing center will open in 2019 as part of the state’s effort to be a leader in the $100 billion AV industry.