Thursday, February 3, 2011

Florida Governor Hits Road to Sell His Budget Overhaul

Does this sound familiar to what I have been Blogging about for the last 3 years!

Aivars Lode

POLITICSFEBRUARY 3, 2011.Florida Governor Hits Road to Sell His Budget Overhaul Text By ARIAN CAMPO-FLORES
LEESBURG, Fla.—Gov. Rick Scott is crisscrossing Florida this week, offering glimpses of what he says will be one of the nation's most fiscally conservative budget proposals this year.

In his push to close a $3.6 billion budget deficit and make good on his promise to create 700,000 private-sector jobs in the next seven years, the Republican governor aims to slash spending, cut property and corporate income taxes and overhaul state government, making Florida an example of limited government.

In an interview with WSJ's Arian Campo-Flores and Betsy McKay, Florida Governor Rick Scott outlines his plans for mending the state's budget crisis by cutting the size of government and reducing business regulations.
.Among the proposals he has unveiled this week is a goal of cutting $1.4 billion annually from the budget by requiring state employees to contribute to the state's public pension system for the first time, and by channeling new hires into 401(k)-style plans that wouldn't guarantee set benefits upon retirement.

"We're going to be the model," Mr. Scott said in an interview at this central Florida town's airport, where his personal private jet was parked. (He plans to sell the state's planes.)

The 58-year-old former health-care executive undoubtedly faces significant obstacles, with opposition coming from unions and environmentalists, and skepticism from some in his own party.

Mr. Scott's pension proposal amounts to a pay cut for public workers, said Mark Pudlow, spokesman for the Florida Education Association, the teachers union. "While [Gov. Scott] wants to cut corporate and property taxes, it seems he wants to do it on the backs of state workers," he said.

Environmentalists are howling about Mr. Scott's intention to unleash more development.

In the legislature, Republican dominance of the state House and Senate would seem to boost Mr. Scott's chances of pushing through his agenda. Yet some members of his own party have cast doubt on his plan to cut taxes now, along with spending.

"We need to cut spending first," said Senate President Mike Haridopolos. "If he can show us the budget to make those cuts, we're all ears." But, Mr. Haridopolos added, "it's one step at a time."

Mr. Scott isn't cowed. He is promising to slash Florida's budget by $5 billion, a feat he says he will accomplish by cutting spending and streamlining government. Some of the savings are expected to come from the pension overhaul, and he says a proposal to reorganize various state agencies would save $500 million, on average, a year. Among its provisions: a recommendation to fold the state's Department of Community Affairs, which oversees land planning and development, into the Department of Environmental Protection.

Mr. Scott also wants to purge the budget of what he considers frivolous spending items. He harbors particular disdain for "alligator marketing," a $150,000 pet project that lawmakers inserted in last year's budget to help sellers of alligator hides and other products promote their goods. "The state shouldn't be in that business," he said.

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Ben Fredman for The Wall Street Journal

Florida Gov. Rick Scott with first lady Ann Scott and building contractor Richard Murray during a tour of a home in The Villages, Fla., Monday.
.Some economists doubt there are billions of dollars in waste lurking in the budget, as Mr. Scott says. Lawmakers have been hacking at state outlays for years, as Florida's finances have steadily deteriorated. "I'm not sure there's that much left to cut," said Sean Snaith, a University of Central Florida economist.

Mr. Scott's job-creating plans center on making Florida the most business-friendly state in the U.S. "We're competing with 49 states and a variety of other countries now where people are willing to invest their dollars," he said. "My job…is to make this the place where people want to do business."

For starters, that means making it cheaper to operate in Florida, he said. He proposes cutting the corporate income tax to 3% from 5.5%, and eventually phasing it out. He also intends to eliminate what he deems burdensome regulations. By combining the community affairs and environmental protection agencies, for instance, he hopes to create "one-stop shopping," Mr. Scott said. "If the state's going to be involved, then let's have one place where you can get the answer" to a permitting issue and "an honest time frame for how long it's going to take."

Mr. Scott highlighted the frustrations of many real-estate developers during a visit Monday to a construction site in The Villages, a sprawling retirement community north of Orlando. As he tramped through sandy lots and ducked through the skeletal frames of new houses, he quizzed a construction manager about the number of agencies and permits he had to deal with to get the project under way. Too many to count, the manager replied.

"How much should the state be involved in regulating the growth in communities when you already have a county doing it, or a city doing it?" said Mr. Scott afterward.

Mr. Scott has embraced his role as Florida's pitchman-in-chief. He says he cold-calls five to 15 chief executives a day, urging them to consider setting up shop in the Sunshine State. One state he hopes to poach from is Illinois, which, he noted, recently raised taxes—and also happens to have freezing weather. "Let me turn my air-conditioning down, it's so hot here," he said he told one company official in a recent call.

To lure businesses, Mr. Scott also wants to centralize all economic development activities in one office run by one individual who's accountable to him. "That person will be two offices down from me," he said, "so then it'll be part of what I'm thinking about every day."

Signs that the U.S. economy is strengthening could help Mr. Scott. "His timing is impeccable," said Mr. Snaith, the UCF economist. "He's got the business cycle in his favor right now. I think he will hit 700,000 jobs before seven years, maybe five."

Write to Arian Campo-Flores at

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