Florida’s 2013 legislative session opened this week, beginning a 60-day trek to adjournment on May 3, unless extended. The state’s new 2013-2014 presiding legislative officers have endeavored to publicly present a coordinated front on several significant issues expected to be taken up and passed. There is less agreement on major budget issues.

The House is led by 33-year-old Will Weatherford (R-Wesley Chapel) and the Senate is led by Don Gaetz (R-Destin). Speaker Weatherford, a businessman, is quickly becoming the darling of the Republican Party, both in Florida and nationally. He is likely at the start of a long political career. Weatherford is the son-in-law of former Republican House Speaker Allan Bense of Panama City.

Senate President Gaetz is widely recognized as the father of the hospice industry. He co-founded what is now VITAS Healthcare Corporation. Subsequent to his retirement from VITAS, he was Supervisor of Schools for Okaloosa County, a position he left when he joined the Florida Senate.

The New 2013-2014 Florida Legislature: How They Got Here

The new Florida Legislature was elected in November amid legislative redistricting, which required every representative and senator to run for office. There were160 races in total.  Republicans retained a majority in both chambers following the election, although some seats were lost to Democrats.

The new Florida House of Representatives is made up of 76 Republicans and 44 Democrats, representing an election loss of five seats to the Democrats. Forty-four of those elected in the House are freshman, 20 Republicans and 24 Democrats. In total, House candidates raised $31.6 million for the recent election.

The new Senate is made up of 26 Republicans and 14 Democrats, representing an election gain of two Democrat seats over the prior Legislature. There are 15 freshmen senators: five Democrats and 10 Republicans.  Senate candidates raised $21.8 million in contributions for the recent election.

Another $230.5 million was raised during the campaign season by political parties and committees, bringing the total raised for Florida’s 2012 legislative elections to $283.8 million, by far the largest amount in a legislative campaign season.

2013 Legislative Session Outlook

This article provides a high level summary of some larger profile issues we expect to see raised in the 2013 Legislature. The summary is not all-inclusive.

Budget and Taxation

For the first time since 2008, the Florida Legislature will write a budget using a slight surplus of tax collections. The latest revenue forecast in December 2012 estimated an additional $825 million will be available to craft the next budget. Governor Rick Scott used this forecast to develop and submit his recommended budget of $74 billion. The Legislature, however, will use an updated revenue estimate, due later this month, to craft the actual spending plan. Florida is a balanced budget state, meaning revenues must match expenditures.

The 2013-2014 state budget is expected to essentially be break-even, barring these possible spoilers:

• The costs associated with a Medicaid population expansion anticipated under the Affordable Care Act (ACA). Medicaid is currently the state’s largest expense, outstripping education.
• The costs associated with the state’s compliance, as an employer, with the ACA.
• A worsened economic situation in the Euro Zone.

Governor Scott is advocating another billion dollar infusion into education, which includes a $2,500 pay increase for all teachers. The House and Senate have not committed to this request.

Do not expect this Legislature to raise taxes of any kind. However, there are some proposed tax cuts on the table. The Governor wants to raise the current corporate tax exemption taking another 2,000 small businesses off the state’s tax rolls.

There appears to be more interest in enforcing collection of the state’s sales tax on Internet purchases, but the Republican leadership insists there must also be a correlating offset to make the issue revenue neutral.

Ethics and Elections

The voter calamities around the November 2012 General Election will prompt the Legislature to restore a 14-day early voting period, giving the counties the authority to designate more polling locations.

The state’s campaign finance laws will likely be amended to increase the current $500 limit to an unresolved higher amount. The $500 cap has been in place for 20 years. There will be some policy changes around political action committees, which legislators have been accused of abusing because they currently allow raising unlimited cash.

There may also be some greater restrictions that forbid former legislators from lobbying state agencies in the year after they leave office. There is currently a two-year ban that prevents those legislators from lobbying in the legislative branch.

Health Care and Health Care Insurance

The 2013 Legislature must grapple with implementing the ACA on several levels. Both chambers have created select committees for that purpose. The primary issues for debate are:

• The extent of Medicaid expansion, presumed under the Act. The House is currently at odds with the Governor and likely the Senate over the expansion. This will be a hotly contested issue.
• Whether Florida will permanently default to a federal insurance exchange, create a state-based insurance exchange, or create a hybrid insurance exchange.
• Necessary regulations to comply with the Act.

Economic Development

Expect this Legislature to pass accountability measures aimed at those recruited companies that received state dollars as an incentive to locate in Florida. 

Governor Scott is asking the Legislature to completely eliminate the sales tax currently imposed on the purchase of manufacturing equipment, a $141 million hit to revenues that will have to be reconciled in the budget writing process.

Legislation will be advanced to encourage the development of the manufacturing sector in Florida by creating the opportunity for manufacturers to obtain master plan approval for manufacturing sites at the county level. Once approved, the manufacturer would not need further local government approval for future expansions or modifications, except for building code or safety issues. Manufacturers in participating counties would also enjoy a coordinated permitting process at the state level for the most sought after permits. Florida is among the bottom five states for manufacturing output, and the sector is a huge job creator.

Gaming

The incoming legislative leaders will punt on this issue by creating select committees on gaming to study all facets of gambling for at least one year. Under this arrangement, the earliest the Legislature could deal with an expansion of gambling will be 2014.

Growth Management and Foreclosures

The Legislature may deal with a request from developers to clarify legislation stemming from a 2012 growth management “glitch” bill. A recent Palm Beach County court ruled the 2012 legislation allows residents to seek a referendum challenging a particular proposed development. Developers say that was not the intent of the law.

There may be an attempt to amend laws around transportation concurrency. Legislation has been filed to extend the requirement for proportionate share payments for mobility plans. Other legislation seeks to bar transportation or school concurrency from being applied to developments of 30 homes or less for four years.

The 2013 Legislature will again attempt to resolve the backlog of foreclosure cases that are clogging Florida’s court system. It currently takes about 2.4 years for the average foreclosure case to be resolved in the courts.

Property Insurance

There will be a movement to require the state-run Citizens Property Insurance Corporation to charge actuarially sound premiums and find ways to move policy holders from Citizens into the private insurance market. This will reduce the state’s exposure to catastrophic loss which, if incurred, will be transferred to the backs of most insurance consumers across all lines.