Transportation: Legislature Meets in Special Session on Passenger Rail

The Florida Legislature convened in special session on December 3, 2009 to address passenger rail issues. The joint proclamation issued by Senate President Jeff Atwater (R-North Palm Beach) and House Speaker Larry Cretul (R-Ocala) does not include any other issues and gives lawmakers until December 10, 2009 to complete their work.

In general, the legislation currently under consideration would:

Create the Florida Rail Enterprise, modeled after the Florida Turnpike Enterprise, to coordinate the development and operation of passenger rail throughout Florida, including high-speed rail

Create the Statewide Passenger Rail Commission to monitor and review publicly funded passenger rail systems and to advise the Florida Department of Transportation (FDOT) and the Legislature on issues relating to the passenger rail system

Provide funding for publicly supported rail projects by revising distributions of documentary stamp tax revenues and by allocating funds from the State Transportation Trust Fund to the South Florida Regional Transportation Authority (Tri-Rail)

Authorize FDOT to complete acquisition of a 61-mile rail corridor for the central Florida commuter rail project known as SunRail

Authorize FDOT to protect against liability risks by maintaining a "self-retention" fund and insurance coverage, and to indemnify freight operators for loss, injury, or damage to commuter rail passengers or rail corridor invitees

Proponents of the legislation, including Governor Charlie Crist and leaders of both houses of the Legislature, have argued that quick legislative action is needed to enable Florida to compete for several billion dollars of federal stimulus funding.

The current version of the bill includes several differences from legislation that failed in the 2009 regular Legislative session. Many legislators objected to the earlier bill's use of a rental car surcharge to fund Tri-Rail and broad assumption of liability by the state. However, support for the new bill is far from unanimous. In the Senate, Minority Leader Alfred "Al" Lawson, Jr. (D-Tallahassee), a cosponsor of the bill, was quoted saying, "Right now, I don't know if we've got the votes, or even if I'll vote for it." Sen. Carey Baker (R-Eustis), a SunRail supporter, announced that he would oppose the bill because of its breadth. "I thought we were coming up here to vote on a nice SunRail bill, a Little Red Riding Hood bill, instead we're voting on this Big Bad Wolf bill that I don't support," Sen. Baker said.

Public Corruption: State Supreme Court Approves Governor's Request for a Statewide Grand Jury

On December 2, 2009, the Supreme Court of Florida approved Gov. Crist's petition to impanel a statewide grand jury on public corruption. Earlier in the week, the court had rejected the request, finding that it was vague and failed to allege that the crimes to be investigated involved multiple judicial circuits. In a revised petition, the governor noted that in many cases, the offenses span several circuits, and in other cases the underlying causes are not confined to a single circuit. Gov. Crist also noted that he had suspended 33 public officials from office in his three years as governor.

Judge Victor Tobin, Chief Judge of the 17th Judicial Circuit (Broward County) will preside over the statewide grand jury.

State Budget: Revenue Estimators Raise Projections, but Massive Shortfalls Remain

In a meeting on December 4, 2009, the Consensus Revenue Estimating Conference revised its revenue estimates for the current and upcoming state fiscal years. The revenue estimators now project that state revenues for the fiscal year ending June 30, 2010 will be $338.4 million higher than the previous estimate, an increase of 1.6 percent.

The conferees also forecast that revenues for the 2010 – 2011 fiscal year will be 1.4 percent, or $312.6 million, higher than the previous estimate. Even with this improvement, legislators face a shortfall of $2.6 billion for a budget that only continues current "critical needs" spending.

If revenues for the current fiscal year follow the current projections, 2009 – 2010 will mark the end of three years of declining state revenues. Under the current projection, 2009 – 2010 revenues will be $6 million higher than revenues from 2008 – 2009. Further growth is expected in the 2010 – 2011 fiscal year, with estimators projecting a 6.6 percent increase in revenues over the current year.

Politics: Major Political Contributor Scott Rothstein Jailed on Federal Charges

Federal authorities have charged disbarred Fort Lauderdale attorney Scott Rothstein with racketeering, conspiracy to launder money, conspiracy to commit fraud, and wire fraud on December 2, 2009. Mr. Rothstein is alleged to have been at the center of a $1.2 billion Ponzi scheme involving the sale of interests in structured settlements. He entered a not guilty plea and did not object to the government's request that he be held at the Miami Federal Detention Center pending trial.

Mr. Rothstein's law firm, Rothstein Rosenfeldt Adler, has been dissolved. Mr. Rothstein was disbarred on November 25, 2009, pursuant to negotiations with the Florida Bar. The government has seized $60 million of Mr. Rothstein 's assets.

Mr. Rothstein became a major political contributor in recent years. According to one newspaper's estimates, he and members of his firm were responsible for $2.1 million in state and federal political contributions since 2005, when the Ponzi scheme allegedly began. The largest contributions included at least $628,000 to the Republican Party of Florida, $200,000 to the Florida Democratic Party, $80,450 to the U.S. Senate campaign of Gov. Crist. At the request of federal prosecutors, Gov. Crist, Democratic state Chief Financial Officer Alex Sink, and the Republican Party of Florida have voluntarily returned more than $160,000 in contributions to the federal government.

Mr. Rothstein's pretrial hearing is scheduled for January 6, 2010, and his trial is scheduled to begin on January 11, 2010.

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