United States: Florida Government And Politics Weekly Update (Week Of August 17, 2009)

Politics: Governor Crist Asks Three to Apply for U.S. Senate Vacancy

On August 14, 2009, Gov. Charlie Crist asked three prominent Republicans to submit an application for appointment to fill the U.S. Senate vacancy created by the resignation of Sen. Mel Martinez. The governor had earlier told reporters that he would be working from a short list of "about seven" potential appointees.

The first three asked to apply were former state Attorney General and Secretary of State Jim Smith of Tallahassee, former U.S. Attorney Roberto "Bobby" Martinez of Miami, and U.S. Rep. Lincoln Diaz-Balart (R-21^st Congressional District) of Miami.

Mr. Smith is currently a principal in the Smith & Ballard lobbying firm and chairs the Florida State University Board of Trustees. Mr. Martinez is a partner in the law firm of Colson Hicks Eidson and a member of the State Board of Education. He previously served as chair of Gov. Crist's transition team. Rep. Diaz-Balart has served in the U.S. House since 1993 and is the brother of U.S. Rep. Mario Diaz-Balart (R-25^th Congressional District).

Banking: Regulators Seize Colonial Bank and Arrange Sale to BB&T

In the sixth-largest bank failure in U.S. history, the FDIC on August 14, 2009, seized Colonial Bank of Montgomery, Alabama, and arranged for the sale of the bulk of the bank's deposits, branches, and assets to BB&T Corp. of Winston-Salem, North Carolina. At the time of its seizure, Colonial Bank had more than $25 billion in assets and 346 branches in five states. The Colonial Bank failure was the largest bank failure of 2009.

The transaction will make BB&T one of the largest banks in Florida. As of June 30, 2008, Colonial Bank was Florida's fifth-largest bank measured by deposits, with 199 branches and $10.5 billion in deposits in the state. BB&T has approximately $52 billion in assets and 1,504 branches in 12 states. Prior to the acquisition of Colonial Bank, BB&T was Florida's eleventh-largest bank, with 107 branches in the state. The four largest banking companies in Florida are Wachovia Corp. (owned by Wells Fargo), Bank of America, SunTrust Banks, and Regions Financial Corp.

State Budget: State Officials Reduce General Revenue Estimates by $147.1 Million

At its August 11, 2009 meeting, the Consensus Revenue Estimating Conference reduced the official estimate of state general revenues by $147.1 million, or slightly less than one percent, from the March 2009 estimates. The state budget for the 2009 – 2010 fiscal year was based on the earlier estimates, but the shortfall can be covered from the state's reserve funds.

The conference also reduced general revenue estimates for the 2010 – 2011 fiscal year by $44.2 million.

The revenue estimates represent an agreement between legislative and executive branch economists. The legislative analysts began the conference forecasting a shortfall of $219 million to $320 million, and the executive branch analysts started with a $45.6 million shortfall estimate.

According to the members of the conference, the continued decline in home prices, rising unemployment, and the drop in asset values are undermining consumer and business confidence and reducing discretionary spending, resulting in sales tax and insurance premium tax revenues below previous estimates. Although corporate income tax, intangibles tax, and documentary stamp tax revenues were higher than earlier estimates, these increases were not sufficient to offset the lower sales tax and insurance premium tax revenues.

Environment and Energy: Governor and Cabinet Approve First Nuclear Power Plant Since 1976

On August 14, 2009, the governor and Cabinet approved Progress Energy Florida, Inc.'s proposal to construct a nuclear power plant in Levy County. The last time construction of a Florida nuclear power plant was approved was in 1976, when Florida Power & Light Company received approval for a plant in St. Lucie County.

The approval was limited to the location and environmental impact of the proposed plant. Final approval authority rests with the U.S. Nuclear Regulatory Commission. If the plant receives federal approval, it could begin operating as soon as 2016. The plant would provide approximately 3,000 construction jobs and 800 permanent jobs after it becomes operational.

Politics: Senate Special Election Campaign Heats Up

The special election campaign to elect a successor to the late state Sen. James E. "Jim" King, Jr. heated up with the entry of Duval County School Board member Stan Jordan (R-Jacksonville). Mr. Jordan, a former member of the state House, is reportedly backed by the plaintiff's bar. His leading opponent is former state House Speaker John Thrasher (R-St. Augustine), who is generally backed by business and medical interests. Other candidates in the Republican primary include Jacksonville City Council member Art Graham and anti-tax activist Dan Quiggle. On August 10, 2009, former state Rep. Aaron Bean, who had previously filed to run for the seat in the 2010 general election, announced that he would not run in the special election and would instead support Mr. Thrasher's candidacy.

Mr. Thrasher currently leads in fundraising, with contributions of $274,379. Mr. Graham reports contributions of $133,023, and Mr. Quiggle reports contributions of $117,869. Fundraising reports from Mr. Jordan are not yet available.

The special primary election will be held on September 15, 2009, and the special general election will be held on October 6, 2009.

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