House offers deal on tobacco tax that exempts cigars

In the latest closed-door offer to the Florida Senate offered by the House chief budget negotiator, Rep. Dean Cannon, the House abandons its no-taxes position and instead agrees to the Senate's $1-per-pack increase in a cigarette tax. But, in a slight to the Miami delegation and a nod to Tampa's lawmakers, it also imposes a new tax on tobacco companies that don't pay the state a settlement fee and eliminates the new $1-per-ounce tax on cigars.

The measure is aggressively opposed by Dosal Tobacco, the home-grown Miami company that makes low-cost cigarettes. It was sued but dismissed from the state's 1994 lawsuit against Big Tobacco. Persuading the state to impose a fee on Dosal and other non-settling manufacturers has been a top priority of the nation's cigarette giants this session, next to killing the cigarette tax.

To protest the move, Dosal announced today that it will close its plant on Friday and bus all its employees and their family members to Tallahassee to send the message they don't want their jobs threatened by the legislature's budget fix.

"These people need their jobs,'' said Yolanda Nader, CEO of Dosal. She said that if the state believes the company ought to be paying into the settlement, it should not have dismissed Dosal from the original lawsuit 15 years ago.

Their concerns may be short-lived, however. Senate budget chief, J.D. Alexander, R-Lake Wales and Senate President Jeff Atwater have said they don't support the tax on nonsettling manufacturers like Dosal. As to the Cannon offer that trades cigars for cigarettes, Alexander said Thursday: "We're not too keen on that.''

The company has produced this television ad and will begin airing it in Tallahassee this weekend.

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Anti-card check bill advances in Senate

Business and labor squared off Wednesday on a bill that would prohibit open or "card check" union-organizing drives in Florida. As expected, business groups prevailed, as the Senate Ethics and Elections Committee approved the bill on a 6-3 party-line vote.

The Republican-sponsored Florida bill is inspired by an effort by the Democratic-controlled Congress to force employers to recognize unions if a majority of workers organize through an open signup process. All future union elections in Florida would have to be by secret ballot only.

CFO Sink to State Farm: Release your agents

Just as State Farm officials were about to be grilled before a House panel on insurance, the state's chief financial officer has formally asked the state's largest private insurer to allow its agents to write other homeowner policies.

The way it works now is that State Farm agents can write only State Farm policies, but they can also write Citizens Property Insurance Corp. policies. There's a fear that State Farm's withdrawal from the market will end up pushing a lot of its policies into Citizens. Read it here.

 

OIR subpoenas State Farm

And so it's war. Florida Insurance Commissioner Kevin McCarty has subpoenaed State Farm Florida as a part of an investigation, the office reported. Read the subpoena here.

The request is in response to OIR's review of State Farm's withdrawal plan. They're looking for names, addresses, policy types, policy limits and premium information for each of State Farm’s Florida policyholders.

Crist to State Farm: Bu-bye!

Gov. Charlie Crist effectively said good riddance when asked to react to State Farm's announcement.

"They probably charge the highest rates in the state anyway. Floridians will be much better off without them."

UPDATE: Read the story here. UPDATE2: Chief Financial Officer Alex Sink weighs in: “It is unfortunate and disappointing that State Farm Florida has decided to move out of the neighborhood," Sink said. “My concern goes out to the more than one million Floridians who will need to transition to a new insurance company during the next two years. We will assemble a team of trained consumer specialists within my department to assist Floridians who might have questions about finding a new insurance policy."

State Farm is pulling out of property insurance

UPDATE!: State Farm is pulling out of Florida's property insurance market. More details to come.

The Buzz spotted a group of State Farm executives leaving the Larson building at 10:30 a.m., on a tip the meeting was about a upcoming "big announcement" about property insurance. Spokesman Justin Glover confirmed the meeting was with Commissioner Kevin McCarty and said it was about property insurance but wouldn't answer any questions.

When asked if the state's largest private property insurer threatened to pull out of the market, State Farm spokesman Chris Neal said that the meeting's topic was about the company's "challenges we have faced in the homeowners markets." But he said he hadn't heard the full details of the meeting and said the company might have an announcement at 12:30 p.m.

State Farm was denied a rate increase in homeowners of 47 percent, and company officials have been grumbling for months that they'd pull out, or seriously cut back, if they didn't get the higher homeowners' rates.
See what lines are impacted in the release below.

Fla Chamber lobbies DC for stimulus bill

Mark Wilson, president and CEO of the Florida Chamber of Commerce, was making the rounds on Capitol Hill today to encourage the state's congressional delegation to back President-elect Barack Obama's economic stimulus package.

Wilson said he's also trying to impart the need for the package to address education, growth management and infrastruture, from roads and bridges to water plants.

Is Crist's U.S. Sugar buyout a 'bailout'?

The other major heavyweight in the sugar industry, Florida Crystals, jumped into the middle of the debate over Gov. Charlie Crist's proposed buyout of U.S. Sugar, accusing the state of using Everglades restoration as cover for what's really a bailout of its competitor.

Florida Crystals, which is headed by Alfy and Pepe Fanjul, filed a legal challenge to the South Florida Water Management District's bond validation suit, thus blocking at least temporarily the state's plan to borrow $1.34-billion to buy 181,000 acres of U.S. Sugar's land. However, the challenge is unlikely to stop the water district board's scheduled vote on the buyout Tuesday.

Robert Coker of U.S. Sugar said the buyout is not a bailout, and that it was "a relief to finally have Florida Crystals and the Fanjuls come out in the open rather than lurking around in the background" opposing the purchase. Gaston Castens of Florida Crystals said the company doesn't object to Crist's buyout plan per se, just the terms in the proposed contract. Here's the legal challenge.

Craig Pittman, Times staff writer

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Sen. Alexander vs. Citizens, part 9?

Sen. J.D. Alexander, a frequent critic of Citizens Property Insurance Corp., wrote a scathing letter questioning Citizen's quest for new office space.

But Citizens says: Hold on a second, we haven't chosen anything yet. 

On and off the Amendment 5 bandwagon

In a roundtable discussion with business owners at the mansion Tuesday, Gov. Charlie Crist listened a lot, and for the second straight day promoted Amendment 5 on the November ballot to give business people much-needed relief. Amendment 5 is the so-called tax swap that will eliminate property taxes for education (about 25 percent of a tax bill) while holding schools harmless and requiring the Legislature to come up with billions of dollars a year in replacement money.

One of Crist's mansion guests was Chuck Bonfiglio, president of the Florida Association of Realtors, the largest interest group backing the proposal. "It's kind of an across the board tax relief for everyone," the real estate agent told Crist. "We see it as one of the most far-reaching tax reform initiatives this state has ever seen."