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Corporate Tax Cut Out, Privatizing Prisons and 3% Public Pension Contributions In

| May 1, 2011

A Florida legislator at work.

The House and Senate budget chiefs cleared the decks of a slate of budget issues during negotiations Saturday, paving the way for the debates over education and, particularly, health-care spending measures that will decide the final contours of an agreement between the two chambers.

At the same time, Gov. Rick Scott signaled he is likely to sign a legislative agreement on how to slice $1.2 billion from public employees’ pensions.

Senate Budget Chairman J.D. Alexander, R-Lakes Wales, and House Appropriations Chairwoman Denise Grimsley, R-Sebring, hammered out deals on remaining issues in the budgets for the state’s justice system, government operations and agriculture and natural resources.

On prisons, it appeared the chambers were likely to agree to a privatization plan close to the Senate’s, which would give corporations control over prisons in essentially the southern third of the state. While Grimsley said the details were still being worked out in proviso, Alexander said he understood the house to be essentially agreeing to the Senate plan for privatizing facilities in 18 counties.

Alexander said the plan could save the state $30 million when it’s finally implemented. A separate deal to privatize inmate health-care across the state would have to save at least 3 percent, though Alexander indicated he believed both estimates were too conservative.

Grimsley and Alexander also reached agreement on a contentious deregulation bill after the House agreed to remove talent and sports agents from the bill. Alexander had expressed concern about deregulating agents, saying University of Florida Athletics Director Jeremy Foley had called him with misgivings about the plan.

College football was rocked last year by allegations that players at several universities had received impermissible benefits from agents; players at schools in North Carolina, South Carolina, Georgia and Alabama were benched for at least parts of the season during the scandal.

But the regulation of commercial interior designers ends under the plan, despite the objections of the designers themselves, who said it would disqualify them from certain commercial jobs, and lessen the value of their training. Supporters of deregulating the profession said it would break up the monopoly licensed designers held in the field.

“Business-to-business doesn’t need the same level of protection and regulation as you need with some 20-year-old athlete or the woman who wants to be the next American Idol,” Alexander said.

Meanwhile, Scott issued a statement Saturday hailing the agreement lawmakers struck Friday night to require public employees to contribute 3 percent of their income toward the state pension plan. The proposal was less harsh than the governor’s blueprint, which called for a 5 percent contribution and forcing new employees into a 401(k)-style defined-contribution plan.

And Scott, who called the legislation “a great first step toward modernizing Florida’s outdated pension system,” suggested he would continue to push his broader plan.

“It is my goal to continue to modernize Florida’s retirement system until it is no longer reliant on our state’s taxpayers,” he said. “But I’m pleased that we’re moving in the right direction.”

Scott still appears unlikely to get his plan to reduce the corporate income tax as the first step toward phasing it out, though lawmakers have yet to tap $300 million set aside to help smooth over differences in conference. Alexander did not ruling out using the money for the tax, but said the money could still be needed to plug some holes in other budgets.

“That’s not currently the plan,” he said.

–Brandon Larrabee, News Service of Florida

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