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    Senate president relishes victory after bill passes

    By STEVE BOUSQUET, Times Staff Writer
    © St. Petersburg Times
    published March 24, 2002

    TALLAHASSEE -- Savoring the moment, John McKay leaned back, a glass of champagne in his hand.

    Against overwhelming opposition, the Senate president's tenacious pursuit of a review of tax exemptions paid off. Under a bill the Legislature approved Friday night, voters will be asked in November to create a legislative committee with power to repeal tax breaks.

    "Who thought we'd get this far?" McKay asked, satisfied he had frustrated his critics once again.

    The larger question is: What did McKay win?

    The result bears little similarity to his original plan for a wholesale wipeout of tax exemptions tied to a 25 percent cut in the sales tax rate. That idea was resoundingly defeated by the House, 99-0, after a firestorm of opposition from Gov. Jeb Bush and business groups.

    Supporters of McKay's original tax proposal, such as the League of Cities, Association of Counties, AARP and Florida Education Association, never coalesced effectively.

    The compromise is a ballot measure to create a panel of 12 lawmakers, six in each house, to review categories of exemptions over three years starting in 2003 and repeal those it decides are unjustified.

    The full Legislature then would have two years to override the panel's decisions, so there are no assurances that any exemptions would be eliminated.

    "This sounds bigger than it is, and that's good, because we needed to come up with something that had meat. It's got meat, but it's nothing that's going to make anybody gag," said Senate Majority Leader Jim King, R-Jacksonville, who is set to succeed McKay as Senate president. "This really is tax reform light."

    A few lawmakers see a sham in the making because incoming legislative leaders, including King, could stack the deck by loading the panel with pro-business conservatives who have no interest in shaking up the status quo.

    "I think we're going to get snookered in the end," said Sen. Kendrick Meek, D-Miami.

    McKay fulfilled his ambitions of tax reform by helping House Speaker Tom Feeney fulfill his ambition of a winnable seat in Congress.

    McKay's final tax plan is a modest one, but it has enough teeth in it to infuriate many lobbyists for two reasons: Their exemptions will be scrutinized once again, and they wanted desperately to defeat McKay and didn't.

    "To not win so late in the session is very disappointing," said Steve Birtman of the National Federation of Independent Business. "We didn't totally lose, but we sure as hell didn't feel like we did when it was 99 to nothing in the House."

    Surprisingly, much of business' fury is aimed not at McKay but at the House, which for weeks rejected talk of a tax overhaul as unwise and unnecessary. As time ran out, however, even Gov. Jeb Bush urged House members to support the compromise as a way to bring the session to a smooth landing, and they did.

    A vocal opponent was Rep. Mike Fasano, R-New Port Richey, who objected to a review that gives as few as seven people power to set tax policy for the state.

    The same business lobbyists who accused McKay of a secret plan to raise taxes are plotting their next move. They may ask the Florida Supreme Court to throw the question from the ballot. If that fails, they may raise millions more to urge voters to defeat it.

    There are hints that opponents might play on public fears and paint the tax panel as a runaway train that could tax groceries, medicine or rent, the most sacred tax-exempt items.

    "There's already a distrust of government, and now we can legitimately say groceries and medicine are on the line. My understanding is, it's a review of everything," said Lloyd "Buddy" Turman of the Florida Institute of Certified Public Accountants.

    Such a campaign would tacitly be pro-Republican business groups portraying Republican legislators as pro-tax in an election year.

    Republicans passed McKay's tax proposal while many Democrats voted against it, some fearing a yes vote could be used to tar them as supporting higher taxes during the upcoming campaign.

    All but three of 77 House Republicans voted for the watered-down McKay proposal and 20 of 25 Senate Republicans voted for it.

    What appears certain for now is that for the next three years, tax-exempt businesses and services will have to enlist lobbyists and twist arms to keep the exemptions they currently enjoy.

    In the end, tax reform was decided not by the will of the majority so much as the will of one man who wanted nothing else and who has no higher political ambitions.

    "A person can be very dangerous when he has nothing to lose," Turman said.

    -- Times staff writer Alisa Ulferts contributed to this report.

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