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Raiding Fund Easy Out For Visionless Pols

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The Tampa Tribune

Published: December 10, 2008

The only thing more distressing than the increasingly darkening state budget picture in Tallahassee is the utter lack of leadership and problem-solving skills being shown by Gov. Charlie Crist and the Florida Legislature.

That's why it's understandable that the family of former Gov. Lawton Chiles minced no words when they sent an angry letter to Crist and legislative leaders threatening to sue if the governor and Legislature raid the Lawton Chiles Endowment Fund to plug a $2.1 billon hole in the current state budget.

The Chiles family knows it would be shortsighted to liquidate the fund's assets in today's bad market just to give the illusion of championing lower taxes. Emptying the endowment now will mean less state revenue in the future.

As Florida nears the 10th anniversary of the death of the iconic, folksy Chiles, the big question in Tallahassee is how quickly to gobble up the endowment's nest egg.

A better question is: "What would Lawton do?"

For starters, lawmakers should consider raising Florida's cigarette tax by from 50 cents to $1 a pack, which would generate from $500 million to $1 billion a year - the latter amount being as much as might be available in the endowment fund.

Florida's cigarette tax hasn't been increased in a decade and at a paltry 34 cents a pack ranks 46th among the 50 states.

An added bonus: Raising cigarette taxes curbs youth smoking by up to 20 percent, reports the American Heart Association. If that lessens future state spending on health care for smoking-related illnesses, the increase is worth it. And it is a tax that no one is forced to pay.

Perhaps smokers would complain louder than would the many children and seniors whose programs depend on a small but steady revenue stream from the Chiles endowment. But lawmakers should take the heat.

The fund was established using about 10 percent of the $11.3 billion lawsuit settlement the former governor won from the nation's tobacco companies. It was one thing for Crist to make an emergency loan from the endowment, which must be repaid in two years, as he did earlier this year. That at least ensures that the principal is protected and will resume generating income when its stock holdings rebound.

But if Crist and legislators spend the principal, it's gone for good. It is doubtful any future Legislature would have the political fortitude to put the money back in the endowment when Florida revenues recover.

Another source of revenue that should be pursued before the Chiles endowment is touched is an estimated $1 billion that could be gained in sales tax revenues if Florida found a way to collect sales taxes owed on Internet and mail-order purchases.

Technically, the tax is already owed, so it's not even a tax increase. Even the most ardent no-new-taxes type has to admit that.

But Florida has decided not to even try to collect from online sales-tax scofflaws, not only shortchanging state coffers but putting traditional retailers who collect sales tax at a disadvantage.

Florida needs to join in the campaign for federal legislation to apply sales taxes to Internet purchases and join the Streamlined State Sales Tax Governing Board, a nonprofit group pushing for the reform.

The Tallahassee leaders seeking to raid the Chiles fund are looking for an easy out on the state's revenue problems. They would make Florida's most powerless citizens pay the price.

What they need isn't Chiles' endowment; they need his political courage.

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