April 20, 2009
During its April 20th meeting, the Senate General Government Appropriations Committee further advanced a version of workers’ compensation legislation that is unfriendly to Florida businesses. Last week we reported to you that the Senate Judiciary Committee amended SB 2072 by Senator Garrett Richter to allow higher attorney’s fees in workers’ compensation cases. Today another unfriendly amendment by Senator Al Lawson (D-Tallahassee) was added to that version of the bill which will further allow attorneys to collect higher fees in instances where they represent first responders for occupational diseases. The committee did not consider any amendments that would restore the bill to its original intent as filed that would correct the statutory ambiguity identified by the Florida Supreme Court in the Murray decision.
The bill as passed by the Senate General Government Appropriations Committee today will NOT decrease or work to roll back the 6.4% rate hike that became effective April 1, 2009. The bill as passed today will NOT prevent future rate increases, estimated at 18.6% over the next 2 years, from being hoisted onto the backs of Florida’s employers.
Today’s hearing was the last committee stop for this bill, however, and the legislation is now ready to be heard by the full Senate. Fortunately, the House has already passed a strong workers’ compensation bill that will lower rates for Florida employers with HB 903 which is currently in Senate messages.
The General Government Appropriations Committee passed SB 2270 Relating to Corporate Income Tax/Water’s Edge by Sen. Dan Gelber (R-Miami Beach) by a vote of 3-2. The bill mandates combined reporting by requiring all members of a unitary business (water’s edge group) to file a combined return and to apportion income to Florida using a single apportionment computation. Under current Florida law, corporations operating both in Florida and in other parts of the U.S. pay taxes depending on the portion of their total sales, payroll, and property located in Florida, as opposed to those portions located in all states. Corporations, which are members of federally defined affiliated groups, have the choice of filing as a separate entity or as a consolidated group. Florida exempts “foreign source income” from its corporate-income tax. Income, such as dividends, paid to a corporation operating in Florida by subsidiaries located in foreign countries is not included in the calculation of Florida income.
When presenting the bill, Sen. Gelber explained that the bill closed loopholes that multi-state companies were using to lower their state income subject to Florida’s 5.5% corporate income tax. He gave the example of Wal-Mart using a provision of law allowing them to deduct lease expense to an affiliated company located in a state that does not have an income tax.
AIF briefly spoke in opposition to the bill, but it seems that the Senate is committed to making the bill a part of what revenue enhancements are available for budget conference negotiations with the House.
AIF strongly opposes this bill because it is overly broad and discourages investment and therefore economic development in the state. Moreover, the bill includes provisions that no other competing state currently has making Florida at a real disadvantage when competing for jobs with other SE states. In addition there is doubt that it will increase revenues for the state based on an Ernst and Young LLP study.
The Senate General Government Appropriations Committee unanimously approved SB 852 Relating to Economic Development Projects/Expedited Permitting by Senator Mike Fasano (R-New Port Ritchey).
For two years in a row AIF has worked with Sen. Fasano on this legislation that is written to help businesses receive approval or denial from the state Department of Environmental Protection (DEP) or regional Water Management Districts on water resource permit applications. This legislation would cut the existing application time in half (45 days) for economic development projects defined as a “Targeted Business” for the region and implement a process by which a mandatory pre-application meeting to review the paperwork is completed prior to the 45-day clock beginning. Additionally, the bill also requires that local governments must grant approval for this expedited process by passing a resolution stating the local government supported the expedited permitting process for the project.
AIF has worked hard on the issue and has included it in the Economic Stimulus Package 2.0 (ESP 2.0) as well as testifying in committees on behalf of the legislation.
SB 852 will now be considered on the Senate floor.
The House companion, HB 73 by Representative Rob Schenck (R-Springhill) is scheduled to be on the floor of the House tomorrow. It is anticipated that the House will pass it out with no problem and send it to the Senate for final passage later this week.
AIF SUPPORTS legislation aimed at improving the permitting process for existing businesses in Florida and for those companies looking to invest in our state. AIF has been out in front on this issue and has included it in our Economic Stimulus Package 2.0 (ESP 2.0) as a top priority in finding ways that the state can help stimulate the economy through reduced regulation.
Today, the Senate Finance and Tax Committee unanimously approved SB 1502 Relating to Fast Track Economic Stimulus for Small Businesses by Senator Mike Fasano (R-New Port Richey). Growth and economic activity are job drivers for the state’s economy, and this bill will create jobs and stimulate economic activity in the state while fostering growth in some of the most depressed areas of Florida. By drawing private capital investment into the state by a program that would match it with state incentives, this legislation is a perfect way to help jump start Florida’s economy and can get it back on track by investing in Florida’s businesses.
The bill, arguably one of the session's most innovative stimulus bills, would encourage venture capital into the state and draw down millions in available federal funds. AIF has supported this legislation in every committee and was on hand today and testified in favor of the legislation.
While this is another step forward for the bill this year, it is also significant because this legislation has died the previous two years in this committee.
SB 1502 will now be considered by the Senate Policy & Steering Committee on Ways and Means.
AIF is an ardent supporter of this legislation. Not only will this create jobs and stimulate economic activity in the state, but it will also foster growth in some of the most depressed areas of Florida. Growth and economic activity are job drivers for the state’s economy and programs like the New Markets Development Program are just one way that Florida’s economy can get back on track.
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