Gov. Bush proposes tax giveback in final year

TALLAHASSEE, Fla. (AP) -- Feb. 1, 2006 -- Every homeowner would get a $100 check in the mail and see their property tax rates go down under a proposal Tuesday by Gov. Jeb Bush, part of $1.5 billion in tax breaks he said would help homeowners and businesses reeling from hurricane costs.

Bush also is calling for holding the back-to-school sales tax holiday every year, along with an annual break from taxes on hurricane supplies.
If lawmakers agree, Bush would end his tenure as governor as it started, giving money back to taxpayers.

''The purpose of it is to tell homeowners, 'Thank you for your hard work, thank you for your resiliency,''' Bush said.

The idea to send every homeowner and mobile-home owner $100 was actually proposed earlier in the year by legislative Democrats, who have generally opposed most of the Republican governor's $14 billion in tax cuts during the past seven years. Democrats have argued over the years that Bush-backed tax breaks have benefited wealthier people more than the average taxpayer.

But Democrats, outnumbered greatly by Republicans in the Legislature, have more recently said that if there are going to be tax cuts, they ought to at least go to the broadest cross-section of Floridians, and Bush said he was pleased to have a tax cut proposal that's at least partly bipartisan.

Some Democrats don't think there should be tax cuts at all this year, and some argued at least part of the money could be better spent on education or health care.
Rep. Ron Greenstein, D-Coconut Creek, supports Bush's $100 rebate idea.
''If you're going to play tax relief it should be broad-based,'' Greenstein said. ''Are there needs that might not be funded because we're giving (a tax cut) to the everyday Joe? Probably.''

Greenstein said health care -- particularly help for people who can't get health insurance -- is an area where the state needs to spend more money.

The one-time $100 rebate will amount to $500 million from the state's coffers.
Bush also will ask lawmakers to cut another $570 million with a 9 percent reduction in the property tax that the state requires local school districts to impose, a cut Bush said would save the average homeowner another $55 a year.

Florida learned late last year that it has plenty of money it can give back. State economists in November estimated tax collections will grow by $3.2 billion more than previously expected during the rest of this budget year and the new one beginning July 1.

Much of that is because of more robust sales tax collections than expected -- thanks in part to the rebuilding that occurred after four hurricanes in 2004 and more repairs in the wake of hurricanes Dennis, Katrina and Wilma last year.

''Florida's families and businesses fund our government, something people in Tallahassee lose sight of,'' Bush said.

Florida has offered a break from the state's 6 percent sales tax at back-to-school times in several recent years, but lawmakers have to pass a new law each year to do it. Bush proposed making the tax break an automatic every-year affair, along with a recurring annual sales tax break on hurricane supplies, which lawmakers also gave Floridians last year.

That would have the added purpose of pushing Floridians to better prepare themselves and their homes for future storms, and maybe save lives.

''We have got to create a culture of preparedness in our state,'' Bush said.
Lori Broadhurst of Gulf Breeze, near Pensacola, joined the governor at his announcement, and said last year's hurricane sales tax pushed her to get ready for storms this year -- something she didn't do before 2004's Hurricane Ivan.

With supplies being 6 percent cheaper during the break last year, ''It really was an incentive for us to prepare,'' Broadhurst said.

Republicans in the Legislature had already proposed a plan to exempt all items up to $5,000 from the sales tax during a few days in the summer. House Speaker Allan Bense, R-Panama City, supports the governor's plan, but said the Legislature may end up considering a combination of the tax cut proposals.

Bush also proposed more than $350 million in cuts to taxes on businesses and investors, and the remaining portion of a tax on alcoholic drinks that opponents say is too difficult to collect.

Democrats have also supported other elements in the governor's tax relief plan, including the hurricane sales tax holiday, tax breaks for companies that invest in alternative fuels, such as biodiesel or ethanol, and some small business tax breaks.
Rep. Chris Smith, the leader of Democrats in the House, said he was glad the governor was embracing some more broad-based tax cuts, but couldn't support the plan until he knows what the rest of the governor's budget looks like -- including what won't be paid for.

''He's showing us the icing, but we want to know what's in the cake,'' said Smith, D-Fort Lauderdale.

The governor was scheduled to unveil all the details of his proposed budget on Wednesday. The Legislature will meet in March and April and can accept the governor's proposals, modify them or ignore them completely.

Democrats in the Senate may support some of the governor's tax break proposals. Senate Minority Leader Les Miller of Tampa said he and other Democrats might back the sales tax breaks but was critical of Bush's overall tax policy over the years.

''Just think what we could have done with the $14.2 billion,'' Miller said, citing the need to increase teacher pay and need-based college scholarships.

Sen. Rod Smith of Alachua, one of the Democrats seeking to replace Bush as governor, argued education should get the bulk of Florida's budget surplus this year. Specifically, Smith called for putting $2 billion into school construction, and $20 million to help teachers buy supplies. Smith also suggested spending more than $1 billion to offset property insurance costs that will hit Florida homeowners this year and to speed up the purchase of land for Everglades restoration.

Bush said that even with tax cuts, his budget will still include an increase in local school spending.

''We're not going to do it to the detriment of public education,'' Bush said, arguing that per-student spending has increased more than inflation every year he's been in office.