House Committee Tax Plan Stirs Controversy Over Schools, Airports
Over objections that more money would flow away from public schools and that airport projects could be grounded, the House Ways and Means Committee approved a nearly $350 million tax package that would help farmers impacted by Hurricane Irma and lower a lease tax on businesses.
February 16, 2018 at 02:16 PM
5 minute read
Over objections that more money would flow away from public schools and that airport projects could be grounded, the House Ways and Means Committee approved a nearly $350 million tax package that would help farmers impacted by Hurricane Irma and lower a lease tax on businesses.
In a 14-6 vote along party lines, the Republican-dominated committee approved the package (PCB WMC 18-03), which also includes a series of sales tax “holidays” on back-to-school items and hurricane supplies and offers an 18 percent reduction in penalties for noncriminal traffic infractions, such as speeding within 30 mph over the posted limit, if motorists attend driver-improvement school.
The Senate is working on a package that is expected to include portions of the House measure.
The House vote came after the committee added a provision, opposed by airport officials throughout the state, that would reduce the aviation fuel tax next year to 2.85 cents a gallon. The rate is currently scheduled to go down from 6.9 cents to 4.27 cents a gallon next year.
The committee, meanwhile, rejected an attempt by Democrats to separate part of the package that calls for $154 million in sales-tax credits that businesses could take to fund voucher-like scholarships in the Gardiner Scholarship Program and the Florida Tax Credit Scholarship Program.
“This is going to explode, sending our traditional public-school students into private institutions,” said Rep. Joseph Abruzzo, a Boynton Beach Democrat who also objected to part of the package that would require the Department of Revenue to disclose to scholarship-funding organizations a list of the 200 taxpayers with the greatest corporate income-tax liability during the previous calendar year.
“Why attach such a divisive measure to such good policy?” Abruzzo asked.
Rep. Loranne Ausley, D-Tallahassee, warned the expansion of the tax credits would “cripple” public schools, while Rep. Joe Geller, D-Aventura, called the proposal a “giveaway.”
“To me this is the Titanic approach to funding education,” Geller said. “It has a few people that may get to be put into a lifeboat, but at the expense of all of our students who rely upon public education dollars. And there will never be enough lifeboats.”
Committee Chairman Paul Renner, R-Palm Coast, defended the tax-credit program and the list as ways to open the funding to more companies and to help the scholarship-funding organizations, or SFOs, which play a key role in administering scholarships.
“We have thousands and thousands of companies that are subject to the tax that do not pay the tax, and many others who have no liability under the tax,” Renner said. “So, while the SFOs can reach that tax to pay for these scholarships, it is not a case that they are able to find those companies that are able to participate.”
Renner said the list would be alphabetical, would not disclose the amount of taxes owed by the companies and could only be used to notify taxpayers of the opportunity to make contributions to the Florida Tax Credit Scholarship Program.
The House package also includes a $6.7 million cut that would provide a sales-tax exemption for generator purchases by nursing homes and assisted living facilities. It also includes tax refunds on building materials, fencing and gas for farmers hit by Irma.
Another $34.1 million next year in the House package would come from reducing the commercial lease tax from 5.8 percent to 5.5 percent starting Jan. 1. That reduction would affect half of the state's 2018-19 fiscal year, and the savings to businesses would grow to $81.1 million when implemented for a full fiscal year.
Meanwhile, airport officials from throughout the state objected to a measure added to the package Wednesday by Rep. Lawrence McClure, R-Dover, to further cut the aviation fuel tax.
McClure said the change is intended to make Florida more competitive against such states as North Carolina and Texas, which don't charge the tax.
The change is expected to reduce about $8 million in revenue that goes into a transportation trust fund, which receives about $11 billion a year.
Airport officials said the change won't result in more flights to Florida, and their facilities rely on the fuel tax to obtain matching federal dollars to pay for upgrades, while the trust fund dollars are spread among roads, seaports, spaceports, airports and rail services.
“The demand to grow Florida's airports are here today,” said Gary Duncan, chairman of the Florida Aviation Council and deputy executive director at the Lee County Port Authority. “Airlines fly to where the demand is. They take a lot into account to figure where they're going to put their asset, their aircraft, and they go to where the demand is, where they can make a high yield. If they could make more money flying from Chicago to L.A., versus Chicago to New York, they're going to go Chicago to L.A. And the cost of fuel is not factored in.”
Duncan said Florida airports, from the large commercial facilities to general aviation fields, need about $7 billion in upgrades and an increase in landing fees, which could cost commercial airlines more than the fuel tax, could be a way to make up the lost money.
Fred Baggett, a lobbyist for Airlines for America, which includes major airlines, argued that a lower fuel tax would bring more air traffic and called the remarks from airport officials “a fear rather than facts.”
Jim Turner reports for the News Service of Florida.
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