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Bush: Fund needy, cut tax

The governor reverses his plan to ax the Medically Needy program and aims to undo the intangibles tax.

By ALISA ULFERTS
Published March 8, 2005

TALLAHASSEE - On the eve of the 2005 Legislature, Gov. Jeb Bush proposed speeding up the elimination of an investments tax and fully funding a health care program for the gravely ill and uninsured.

The proposals were part of nearly $700-million in spending recommendations Bush made Monday.

The tax cut would save 320,000 Floridians almost $300-million a year. The Legislature has been chipping away for years at the intangibles tax - a tax on stocks and bonds - and eliminating it has been a priority of the governor's.

Now, with the state's economy buoyed by rebuilding from last year's hurricanes, Bush says the time is right to eliminate the tax.

"Given the robust nature of our economy, this would be a good time to do it," Bush said.

House Speaker Allan Bense supports the proposal, but Senate President Tom Lee has been more cautious about tax cuts.

If lawmakers agree to eliminate the intangibles tax, it would raise to $11-billion the amount of taxes cut by the Bush administration through the 2005 fiscal year.

Bush had proposed gutting most of the Medically Needy program but sought to avoid a political battle that could threaten his ambitious plan to convert Medicaid into a government-funded private insurance plan. "I didn't want the Medically Needy issue to get in the way of discussion about Medicaid reform," Bush said Monday. "I thought it was appropriate to take that off the table for the Legislature."

Bush is expected to lay out his plans for Medicaid, tax cuts, eduction and other priorities during his state of the state speech today.

The governor said he wants to focus on big issues in his remaining two years in office.

"My experience with the hurricanes particularly has kind of changed me as a person," Bush said Friday. "The fact I've got two years left, I want to focus on the bigger things, the longer-term things, and I'm going to urge the Legislature to follow suit."

Social service advocates applauded Bush's plan.

"I know this will be a great relief to my clients," said Florida Legal Services attorney Anne Swerlick, who represents Medically Needy patients.

Bush earned mixed reviews from Democratic lawmakers.

"Democrats are glad to see the governor finally embrace our position of caring for our state's most needy Floridians by restoring funding to the Medically Needy program. At the same time, it's a shame his change of heart had to accompany a proposal to give Florida's multimillionaires a larger tax break," said House Democratic leader Chris Smith of Fort Lauderdale.

With Medically Needy cuts off the table, Bush is expected to confront a fight over his plan for Medicaid, which serves 2.3-million Floridians who can't get traditional health insurance. Its eats about a quarter of the state budget.

The Legislature's top priority is writing a budget.

Not including the revenues lost to the tax cut, Bush wants to increase his $61.6-billion proposed budget by a total of $695.7-million - over half of it in federal money.

If lawmakers approve, the roughly $300-million in additional state money would come from the $3.8-billion Bush has already proposed setting aside in reserves.

--Times staff writer Lucy Morgan contributed to this report, which includes information from the Associated Press.

[Last modified March 8, 2005, 18:42:28]