A House bill to eliminate a permanent health care fund puts the lower chamber at odds with the Senate. The upper chamber planned a transfer of $300 million to the same fund.
The Lawton Chiles Endowment Fund (LCEF), named after former Gov. Lawton Chiles, was established by the Legislature in 1999 to fund health programs in the state.
A House bill to shift money in the LCEF to general revenue passed the House floor Thursday in a 75-42 vote.
The bill (HB 5011) eliminates the LCEF and redirects the funds to the Budget Stabilization Fund. Under the bill, the LCEF would be liquidated by the end of June 2022.
The Senate does not have a bill to eliminate the fund. Section 117 of the Senate budget bill (SB 2500) stipulates a $300 million transfer into the LCEF to repay money borrowed from the fund in Fiscal Year 2012-2013.
After the bill passed the House Thursday morning, the Senate took up the bill in an afternoon floor session. Senators added a strike-all amendment to the bill, which made the bill blank and sets it up for budget conferencing.
Senate President Wilton Simpson had said Wednesday that he is open to eliminating the LCEF because there would be more flexibility if the reserve funds are in the budget stabilization fund.
An analysis of the bill shows shifting LCEF funds into the state’s general fund reserves will “maintain Florida’s high credit ratings and stable financial outlook.”
During debate on the House floor, Democrats bristled at the idea of eliminating the fund, which is named after a former Democratic Governor.
“Would you be voting for this today if this was the Ronald Regan trust fund?” Rep. Joseph Geller asked. “Don’t be disrespectful.”
Republican Rep. Jay Trumball is the bill sponsor.
“I don’t believe that we are being disrespectful,” Trumball said, characterizing the elimination of the fund as a “tip of the hat” to the LCEF.
House Minority Leader Even Jenne said funding for health care is needed during the pandemic.
“All these enhancements that have been made to public health via the Lawton Chiles Endowment Fund, we’re going to sweep it all away in the middle of a pandemic? Members, I just feel this is short sighted policy,” Jenne said.
The fund is valued at $958 million. It was started with $1.7 billion from the state’s landmark settlement agreement with tobacco companies.
This would not be the first time funding has been transferred from the LCEF to the state’s general revenue fund.
After a budget shortfall during the 2008 financial crisis, $700 million was transferred from the LCEF to the general revenue fund to offset a projected shortfall. The transfer was approved during a Special Session to reduce the state budget. Legislators said the funds would be repaid. No repayments have been made.
Another $350 million was transferred from the LCEF to the general revenue fund during fiscal year 2012-2013. The transfer was also supposed to be repaid and included a repayment schedule that required the full amount to be repaid by July of this year. So far, only one repayment of $45.3 million was made in fiscal year 2013-2014, and this is where the Senate has current plans to repay $300 million of the borrowed money.
The House bill does not say the funds would be repaid.
Wednesday during questions on the bill Trumball said continuing payments from the tobacco settlement will be used for health care. The payments are also used for tobacco education.