Sunshine State News – January 22, 2011
Gov. Rick Scott is fond of saying he wants to “make Florida the best place in the country to do business.” Associated Industries of Florida is hoping he’ll do just that — in fact, AIF may have more confidence in the new governor than other organizations.
“Yes, because the governor used to be on our board,” said Barney Bishop III, president and CEO of AIF, when asked if the group had high expectations for 2011.
Scott won a narrow electoral victory in November after campaigning to lower taxes and reduce government regulations. The self-proclaimed “jobs governor” has pleased businesses with his early steps to make good on his campaign promises, like signing an executive order freezing the enactment of new agency rules.
“It sent a clear message that this is going to be a governor who does business a different way,” Bishop said.
Bishop also thinks Scott sent a message in his inaugural address to trial lawyers in the state.
“He called out the trial bar and indicated to them that more tort reform is coming,” he said.
Some of Scott’s campaign promises, however, like cutting corporate taxes and property taxes by 19 percent, will be harder to keep. Florida is facing a $3.62 billion deficit — which could jump to $4.62 billion if $1 billion is put into reserves as some have suggested — and Senate President Mike Haridopolos, R-Merritt Island, has stated that while he is open to Scott’s budget suggestions, his first priority is cutting enough spending to balance the budget.
Haridopolos and House Speaker Dean Cannon, R-Winter Park, appeared to flaunt their new-found supermajorities after the elections in November, calling a special legislative session to override many of former Gov. Charlie Crist’s vetoes. But both leaders insisted at the time that the move was not a signal to Scott, and any perceived conflict between Florida’s executive and legislative branches could be overblown.
“I wouldn’t read into those tea leaves that there’s going to be a whole lot of problems. It doesn’t necessarily mean they’re going to agree on everything, but philosophically, the governor, the Senate president and the House speaker are like three peas in a pod,” Bishop said.
Haridopolos had a similar take Wednesday at the AP editors’ meeting:
“We’re three friends. We’re not Siamese twins. We all have ideas,” Haridopolos said.
But if business leaders are expecting everything to go their way during the legislative session this year, they could be disappointed. Given the state’s deficit, an unemployment rate mired in double digits and the stumbling economic recovery, some problems could prove to be intractable.
The state unemployment compensation tax, for instance, nearly tripled this year, with the minimum rate per worker going up to $73 from $25 last year. The rate is expected to go up again next year, with unemployment remaining high and the state continuing to borrow $115 million per month from the federal government to pay unemployment compensation claims. Employers say the rate hike, coupled with a special assessment that businesses face later this year to help pay the interest on the loans, will have a negative impact on their hiring plans this year.
Despite the generally business-friendly government in Florida, there’s little that could be done to prevent the tax increases, as legislative leaders — at the request of businesses — put off unemployment compensation rate hikes for the past two years, thinking the jobless rate would improve. It didn’t.
“We’ve pushed this off for two years. It’s unfortunate because the economy’s not better. When you get right down to it, we’re going to have to pay it because the fund is broke,” Bishop said.