Robert McClure: Secret study on credit card interchange doesn’t belong in Florida’s budget

Credit cards
In place of any public debate whatsoever this Session, there is now a secret study buried within the 'Legislative Support Services' section of the budget.

Florida has a long history of transparency and openness in government dating back to Gov. Reubin Askew’s administration nearly 50 years ago.

We call it “Government in the Sunshine.” Few states have public meetings to negotiate every jot and tittle of the budgeting process, with “offers,” as we call them, passed back and forth between the House and the Senate during the legislative budget-making process.

This extreme transparency is precisely why it was strange to discover that the 2024-2025 Florida budget, which has not yet been sent to Gov. Ron DeSantis for action, contains a secret “study” aimed at the credit card interchange system.

Almost everyone reading this has a credit card, I am sure, and the debate over how the interchange fee works — allocating money to support customer “points programs” and even fraud protection efforts — became such a public debate in the 2023 Legislative Session that Senate President Kathleen Passidomo called the stakeholders from both sides into her office in early 2024 to try to avoid the public controversy that played out the Session beforehand.

Disturbingly, in place of any public debate whatsoever this Session, there is now a secret study buried within the “Legislative Support Services” section of the budget. The secret study language is tied to a $1 million increase, which would appear to fund the study for the Legislature’s Office of Economic and Demographic Research.

Because of this secret funding, we believe Gov. DeSantis will also be surprised to learn that a study on such a controversial subject as the credit card interchange system is being funded by an arm of the legislature through a “contract with a public or private institution of higher learning” without his input, public discussion, or any public procurement process typically required of a state agency.

The Governor would be justified in his veto of the Legislative Support Services section of the budget in order to eliminate the secret study on the credit card interchange system. His veto message could even include instructions to the legislature to restore their staff funding through a legislative budget amendment but to back out of the $1 million increase tied to the interchange system study.

Once this secret study is removed from the budget, an open and fair debate about the pros and cons of changing the interchange system can take place in the sunshine where it belongs. These kinds of budget items only serve to give the appearance of a rigged system picking winners and losers, absent any public debate. There is a reason Florida has rightly earned its reputation as a state with low taxes and light regulation, where citizens are free to pursue their version of the American Dream without the needless burdens of an overbearing government. It is because our state government acts in the sunshine. Let’s not ruin a good thing.

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Dr. Robert McClure is president and CEO of The James Madison Institute (JMI).

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