FEA Legislative Update – Week of January 18

While thunderstorms rumbled through Tallahassee, rain-soaked and disgruntled legislators began the arduous task of balancing the state’s fragile budget … giving us hints of what is yet to come during the 60-day 2010 legislative session beginning March 2.

Here’s what happened in the Legislature last week:

Budget work begins: So does partisan sniping

House Democrats disagreed with the process the Republican leadership is taking as they embark on the initial work to craft the 2010-11 state budget.  House Education Appropriations Chair Anitere Flores (R-Miami) asked committee members to participate in an exercise that began with “what if we had to cut 15 percent from the education budget.”  Members were asked to submit a list of spending priorities that would be debated during February committee meetings. After that exercise, committee members would be asked to list what could be cut.

House Democratic Leader Franklin Sands (D-Weston) and Rep. Ron Saunders (D-Key West) sent a letter calling the process “fundamentally flawed” and that the budget committees should hold joint meetings with the finance and taxation committee. The Republicans fired back saying the House Democrats were abdicating their responsibilities. Ah yes, partisan snipes are back … as sure a sign as blooming Taiwan cherry and Japanese magnolia trees that springtime in Tallahassee is right around the corner.

As you recall, legislators are facing a budget deficit in 2010-11 of an estimated $3 billion. Lawmakers began hacking away at the state budget in 2007 with cuts over the past three years totaling $6 billion. A struggling economy, growing unemployment and Medicaid caseloads and falling property tax revenues continue to add to Florida’s budget woes. State economists have warned that Florida’s economy will be lagging for years to come if revenue sources and spending remains the same.

Crist’s budget plans: A goal of raising per-student spending

Gov. Charlie Crist proposed increasing education spending next year by $535.5 million over the current fiscal year. Currently per-student spending is $6,844. Under Crist’s plan per student spending would rise to $7,045.

A little budget history: after the 2007 legislative session, per pupil spending was $7,306; but it has been whittled down since then to the current $6,844 figure.

Crist’s budget plan is based upon passage of the Seminole gaming compact – using $443 million of gambling income to fill in the education budget gaps. His plan would also use an unspecified amount of money from the Lawton Chiles Endowment Fund, to help balance the state budget.

But Crist’s plan may be dead on arrival. During the Florida House Committee on Seminole Gaming several weeks ago, committee members voted to reject the governor’s gambling deal with the Seminole Indians. Legislators have been rejecting the deal for several years now and no one but the governor seems optimistic that a new deal can be reached during the upcoming session.

The stewards of the Chiles Fund are also balking at his proposal to raid that trust fund once again to balance the state budget. In 2008 more than $350 million was used to shore up the state budget and during last January’s special session another $700 million was siphoned from the trust fund.

In 2008 the Chiles fund balance was $2 billion. Under the Legislature’s growing addiction to dipping into trust funds to shore up the state budget, the account balance is now $660 million – hence the concern. To refresh your memory: the Lawton Chiles Endowment Fund was established in 1999 with money from Florida’s settlement with the tobacco industry. The proceeds from investing the fund go to support education.

One more thing relating to Crist’s plan: the governor will propose to cut the corporate income-tax rate from 5.5 percent to 4.5 percent for a business’ first $1 million in taxable income. The governor says this is in an attempt to help struggling small businesses. It would cost the state $65 million in revenue.

Further details of the entire Crist budget plan will be rolled out by Friday.

Retirement and Health Insurance: Senators thinking about changes

Senators on the Government Accountability and Oversight Committee have been listening to legislative staff reports about our state retirement and state health insurance plans.  No votes were taken, but onlookers have concerns with the tone of the discussions.

For years the Florida Retirement System (FRS) has been running surplus balances, but now those surpluses are gone.

The Legislature sets FRS contribution rates in statute each year. In July 2009, market and economic declines resulted in an unfunded liability for the first time since 1997. Since July, markets have rebounded, reducing the unfunded liability and restabilizing the fund.

To be fair, committee members are rightfully concerned. They discussed the possibilities of increasing contribution rates and other options, which will be considered at a later date. Any changes could spell more trouble for financially strapped school districts.

The state health insurance plan is costing more, which is not surprising. So senators are considering rate hikes or other cost savings measures, which is also no surprise.  But to our members, who have had little or no salary adjustments over the years, a rate hike could be devastating.

Sen. Mike Fasano (R-New Port Richey) asked several questions that seemed to indicate a desire to consider changes that would require future state employees to contribute to their retirement and eliminating the state contribution to the federal Medicare supplement or other federal insurance benefits. He specifically asked why the state pays the supplement for retirees when that option is available and paid for by the Feds. Fasano also asked how many states do NOT require employee pay-in on retirement.

You may recall that legislators were using the retirement system surplus as a slush fund when the market was good. Now that the market has turned, they want to leave public employees with the check.

Class size: The cost of the “19th child”

It seems to be a perfect storm. With budget problems staring them in the face, legislators are once again setting their sights on revamping the class size provisions voters placed in the Florida Constitution eight years ago. The budget shortfall is giving them ammo to load up for another shot at class size. Last week Republican members of the Senate Education Committee indicated they plan to once again introduce an amendment to change the current constitutional requirements. In 2010, districts will be required to have no more than 18 students in pre-kindergarten through third grades, 22 students in fourth through eighth grades, and 25 students in ninth through 12th grades.

Since implementation of the amendment in 2003, the state says the bill for class size has totaled $16 billion. The statewide average class size has shrunk by six students for prekindergarten to grade three and by five students for grades four to eight. An estimated $3.2 billion more will be needed to fully implement in 2010.

Various proposals are being bounced around Tallahassee to ease the so called “cost burden.” The governor has suggested schools meet a school wide class-size average instead of a per-classroom cap. The proposal would also be written so that no individual class would exceed the limit by three or more students in kindergarten through third grade and no more than five students in grades four through 12. Some Republican legislators support a similar approach.

The voter-approved amendment  has had elected officials and school districts officials carping from the start that full implementation was too burdensome and expensive.

Attorney Ron Meyer, testifying on behalf of FEA, told senators that polling shows that teachers remain overwhelmingly in favor of the class-size provisions. Meyer suggested that the 2010 limits in the existing amendment are not “ironclad” and that legislators could pass a statutory fix that would settle the infamous “19th child debate” – the argument constantly used by opponents who believe that districts would be forced to hire an extra teacher and break up classes mid-year just because one extra student shows up in class.

During the 2009 legislative session, legislators approved a temporary hold on implementation, freezing full implementation at the school wide level until fall 2010.  A recent state report said that nearly 235,000 classrooms in 2,769 schools across Florida would still fall short if the amendment is fully implemented in the fall.

FAIR Amendments: On the November ballot

In Florida, it has been said that voters don’t chose their legislators; legislators chose their voters. Two measures designed to take the politics out of legislative and congressional redistricting got the go-ahead last week and were placed on the 2010 General Election ballot. The proposed constitutional amendments are now known as Amendment 5 and Amendment 6.

Amendment 5 Ballot Summary: Legislative districts or districting plans may not be drawn to favor or disfavor an incumbent or political party. Districts shall not be drawn to deny racial or language minorities the equal opportunity to participate in the political process and elect representatives of their choice. Districts must be contiguous. Unless otherwise required, districts must be compact, as equal in population as feasible, and where feasible must make use of existing city, county and geographical boundaries.

Amendment 6 Ballot Summary: Congressional districts or districting plans may not be drawn to favor or disfavor an incumbent or political party. Districts shall not be drawn to deny racial or language minorities the equal opportunity to participate in the political process and elect representatives of their choice. Districts must be contiguous. Unless otherwise required, districts must be compact, as equal in population as feasible, and where feasible must make use of existing city, county and geographical boundaries.

Every decade, after the census, the boundaries of our congressional and legislative districts are redrawn. This was originally intended to be sure that districts are roughly equal in population — to make sure that every vote counts equally. But the process has been hijacked by self-interested politicians.

When the Legislature passes a congressional or legislative redistricting plan, it’s just like other legislation. All representatives and senators vote on the plan. The party that controls the Legislature controls redistricting. The plan that gets the majority vote becomes the Legislature’s plan. No matter which party has control of the Legislature, that party’s main goal is to protect its majority in as many districts as possible while concentrating the strength of the other party into as few districts as possible.

Former Florida Comptroller Bob Milligan said “these critical reforms will finally end the legalized conflict of interest that allows legislators to design their districts and those of Congress for their own political purposes.”

Fair Districts Florida organizers had to gather nearly 700,000 signatures for each amendment in order to make the 2010 ballot. Voters have to pass the amendments by 60 percent in order for them to take effect during the next round of redistricting, which will happen after this year’s U.S. Census is completed.

But the opposition to the FAIR amendment is mounting legal attacks, saying that fewer minorities will be elected if voters approve of the amendments.

At the polls: Tampa House primary today

The primary to fill the House District 58 seat being vacated by Rep. Mike Scionti (D-Tampa) is being held today. The winners will go on to face each other February 23. Scionti was appointed by President Obama to deputy assistant secretary of defense. There are two Republicans, Jackie Rojas-Quinones and Hunter Chamberlin, in the race. On the Democratic ballot, the candidates are Janet Cruz, Pat Kemp and Gil Sanchez.

As always – if you have questions or would like more information, please email or call the FEA Public Policy Advocacy staff at 850-224-2078.