State: Legislators have shaky budget deal

TALLAHASSEE -- The Florida House and Senate tentatively agreed Thursday on $800-million in cuts in health care, education and juvenile justice programs, but chaos and bitterness over a tax break for investors left the budget in doubt.

With legislative leaders calling each other "immature," "irresponsible" and "inflexible," few in the Capitol expect the agreement to hold or the bickering to end soon, even though both chambers are controlled by Republicans.

The two sides seem certain to clash again before the final cuts are approved, with the biggest sticking point being whether to delay or keep intact a planned cut in the intangibles tax on stocks and bonds.

Here's what happened Thursday:

First, the Senate passed its budget cutting plan, which calls for a repeal or delay of the latest installment of an intangibles tax cut. Keeping the intangibles tax in place would raise $128-million in revenue so the budget cuts wouldn't be so deep.

Then, the House gave its preliminary approval to the Senate's version of the budget cuts. But the House didn't agree to eliminating the intangibles tax cut. Instead, the House would make up the difference from a rainy-day fund.

"We're not going to raise taxes," said Rep. Johnnie Byrd, R-Plant City. "The budget may have a hole in it, but we're going to do what's right."

House Speaker Tom Feeney, R-Oviedo, said he has no intention of reinstating the tax, which he calls unfair to "seniors and savers."

The House's maneuver sparked a firestorm from Senate President John McKay, R-Bradenton, who said the House's plan was "cockamamie" and Feeney "irresponsible," because it will force future legislatures to plug a $128-million hole year after year.

The political fight overshadowed the apparent agreement by the House and Senate to cut millions of dollars affecting Floridians, including money for health coverage for the poor and elderly to money for schools.

For example, the Senate's budget leaves school districts with significant cuts. Pinellas County is looking at a $5.3-million cut; Hillsborough a $8.3-million cut; Pasco, $2.5-million; Hernando, $892,900; and Citrus, $807,000.

Gov. Jeb Bush called the special session to cut as much as $1.3-billion from the $48-billion state budget, to make up for lost tax revenue because of the sagging economy. The lawmakers have been at it since Monday, and hope to finish next week.

Throughout Thursday, Bush's legislative lobbyist, Lt. Gov. Frank Brogan, shuttled back and forth between both sides. McKay and Feeney worked out details by phone.

About 2:45 p.m., Bush made a major concession: He agreed to widen the scope of the legislative session to allow for delay of the intangibles tax break. Bush has pushed for the tax break for the past three years, even as Democrats complained it was a handout to the wealthy.

The governor offered the intangibles tax issue to help both sides find an agreement. Feeney has been a staunch supporter of the tax cut, so the governor wasn't surprised at Feeney's opposition, Bush spokeswoman Lisa Gates said.

"I think there's been some agreement on the budget today," Gates said.

But how much? The House GOP leadership stunned House Democrats and the Senate by agreeing to take up the Senate's budget cut package, which was smaller than the House's. For days, House leaders had insisted the Senate budget didn't go far enough.

And there was the appearance of dissension among Republicans. Rather than break the news in public, Feeney called his GOP members into a secret session Thursday afternoon to tell them they would have to accept the Senate's version of budget cuts.

Republican lawmakers crammed into a small room just off the House chamber, the one place where their rules allow them to meet out of the public eye. Reporters' requests for access to the meeting, which lasted nine minutes, were denied.

Rep. Carlos Lacasa, chief budget architect in the House, said Republican leaders there had developed their strategy of accepting the Senate package while rejecting the repeal of the intangibles tax in the past few days.

"A lot of great minds were at work," he joked.

That was little comfort to House Democratic Leader Lois Frankel, who said even the Senate package cut too deeply in education and health care.

"The Senate bill is still a bad bill," Frankel said.

The Senate voted 29-10 for a budget plan that cuts spending by nearly $800-million for the balance of this fiscal year, and imperils another $1.1-billion in programs for the following fiscal year. Public education and human services, by far the biggest categories, would take the biggest hits.

"I have taken all the cuts I'm willing to take," said Sen. Ron Silver, D-North Miami Beach.

The Senate plan would cut $118-million in public school money; $27-million that was headed to homeowners who lost trees in the citrus canker fight; $14.7-million from the Department of Environmental Protection; and $14.5-million from the state's antismoking program for teens. It also would save $22.5-million by capping enrollment in a prescription assistance program for the elderly.

All 25 Republicans voted for the budget cuts, along with Democrats Silver, Skip Campbell, Steve Geller and Rod Smith. All 10 who voted no were Democrats, including Les Miller of Tampa.

By a 19-17 vote, senators narrowly defeated an amendment that would have let school districts raise $382.5-million by slightly raising property taxes, which is about as close as most Republicans want to get to the tax issue.

Sen. Jack Latvala, R-Palm Harbor, voted for the amendment.

"I think there's a lot of feeling that we really are inflicting a lot of pain on the system, and we're doing things that it's going to be difficult to recover from," said Sen. Don Sullivan, R-Seminole, chairman of Senate education spending.

When the House agreed to the Senate plan, it appeared to start a 72-hour waiting period before the cuts could be approved by the Legislature.

McKay said that he didn't know what would happen next, but that the House plan created a $130-million hole in the budget.

-- Times staff writer Stephen Hegarty contributed to this report, which included information from the Associated Press.

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