Florida: The following two articles provide more complete details on Governor Jeb Bush's recommendations for expending the over $13 billion Florida will receive under its settlement with the tobacco industry.

Bush pushes child, senior spending

Jan. 20, 1999 By JOHN KENNEDY Tallahassee Bureau

TALLAHASSEE - Gov. Jeb Bush on Wednesday called for dramatic increases in programs for Florida's children and seniors - including an end to long waiting lists and an increase in the number of caseworkers - by tapping the state's $13 billion settlement with the tobacco industry.

In a move hailed by social services advocates and anti-smoking groups, Bush also called for placing the tobacco money in a unique investment account named for former Gov. Lawton Chiles, who died in December near the end of his second term.

"The creation of this endowment will ensure that the legacy of Gov. Lawton Chiles won't be squandered," the new Republican governor said.

Bush said his budget recommendation to the Legislature would include an additional $101.3 million to overhaul Florida's troubled child welfare system, a 24.2 percent hike in state spending.

He also plans to make good on a campaign promise by spending $14.6 million to eliminate a 20,000-person waiting list of seniors seeking community services.

All the initiatives outlined would be financed by the 1995 settlement of the state's lawsuit against cigarette makers. The state receives about $450 million a year in payments from the tobacco industry. The lawsuit, which Bush opposed, was the brainchild of Chiles.

"Today, Gov. Bush has acted on his concern for our children and our elderly," said Rhea Chiles, Chiles' widow. "This endowment will ensure that the necessary services will be provided for their well-being, which means a brighter future for us all."

The sharp boost in child welfare spending comes after the system's failings were spotlighted by the death of 6-year-old Kayla McKean of Clermont, whose father is accused of killing her and dumping her body.

A Broward County grand jury also has condemned the poor treatment of children in state foster care.

"I don't plan to stand pat with a system that does not work," Bush said.

Bush's plan, backed by legislative leaders, would add 300 caseworkers to foster care, adoption, child protection and the state's Healthy Families program - a 10 percent boost.

Bush also wants to spend $204 million to add 95,114 children to the state's Kidcare program, which provides state-paid health insurance to low-income youngsters.

In addition, Bush plans to earmark $61.5 million to continue the state's anti-smoking programs aimed at teen-agers. The move quashed fears among anti-smoking groups that the new governor would soften the effort.

Bush's election campaign last fall was assisted by $238,000 in contributions from the tobacco industry to the Florida Republican Party. Included was $115,000 from Philip Morris USA, the nation's largest cigarette maker.

"We've still got to get this plan through the Republican Legislature," said Ralph DeVitto, a vice president with the American Cancer Society. "But having the governor behind this will make a big difference."

Bush's spending plan, to be given to legislators on Feb. 2, would recommend putting the remainder of the state's anticipated $1.1 billion tobacco reserve into an interest-earning account.

The money would be invested by the State Board of Administration, which oversees Florida's public pension funds.

Bush budget advisers predict that tucking the money into conservative index funds could yield an 8 percent annual return, pumping a continuing stream of money into social services and health care programs.

Jack Levine, president of the Center for Florida's Children, conceded that future legislators could opt to shift the money away from such programs. "But if this is approved, any subsequent (legislative) leader would be hard-pressed to change this," Levine said. "It says this money is not 'raid-able.' It's off-limits."

Copyright 1999, Sun-Sentinel Co. and South Florida Interactive, Inc.

Elderly, kids to get boost in Bush budget

Published Thursday, January 21, 1999, in the Miami Herald

By MARK SILVA Capital Bureau Chief

TALLAHASSEE -- Gov. Jeb Bush is proposing a big boost in spending on social services this year and a lasting endowment for protection of children and the elderly with $2 billion of Florida's tobacco treasure.

Bush, a Republican, is asking the GOP-run Legislature to name the endowment for the late Lawton Chiles, the Democratic governor who sued the nation's cigarette makers and secured a $13 billion settlement.

By investing a share of tobacco winnings, Bush proposed Wednesday, Florida can permanently support a cause that Chiles championed -- children -- and offer care at home to thousands of the elderly.

``I believe he'll be able to look down for a long, long time and be able to see that his efforts weren't in vain,'' Bush said Wednesday.

``We will have the best child welfare system in the nation,'' said Kathleen Kearney, the Broward County juvenile judge whom Bush has tapped as secretary of Children and Families, an agency struggling with crises.

This year, as part of a 1999-2000 state budget that Bush will propose to the Legislature in February, the governor wants:

+ A 24 percent boost for protection of abused children and foster care, adding $101 million of state and matching federal spending to Florida's system of child welfare, long plagued by tragic deaths and abuse.

+ A 37 percent boost in the state's ``community care for the elderly,'' $14.6 million more, fulfilling a Bush campaign promise to eliminate a waiting list of people seeking care at home instead of nursing homes.

+ An 83 percent boost in subsidized health care for children, adding $204 million of state and matching federal money, enough to cover 95,000 more children with some sort of state-subsidized health insurance.

For many years beyond, Bush proposes that the state help pay for the growing costs of these programs with the interest earned on a ``Lawton Chiles Tobacco Endowment for Children and Elders.'' With $2 billion invested by 2002, Bush figures, the state can expect to earn more than $100 million a year.

`The creation of this legacy will ensure that the efforts of Lawton Chiles won't be squandered,'' Bush said at a news conference with the speaker of the state House and president of the Senate, both nodding approval.

Lawmakers appear eager to comply and children's advocates cheered the announcements.

Advocates are hailing both the short-term and long-range plans as a landmark commitment to social services by a Republican who ran for governor with promises to care for ``the frailest and weakest among us.''

Bush lauded

Sara Herald, regional vice president in South Florida for the Children's Home Society of Florida, lauds Bush for investing money in lawyers to work on foster-care cases as well as investigators to pursue complaints of child abuse -- 300 new state workers in Bush's plans.

``This is a package that not only says we are going to fund the system, to keep caring for kids who are abused, but we also want to start putting more programming in place to avoid kids coming into the system,'' said Herald, who has advised Bush on child welfare. ``I think it should tell people that he is putting our money where his mouth is.''

Rhea Chiles, widow of the governor who died of heart disease in December, was quick to endorse the new governor's proposal: ``Gov. Bush has acted on his concern for our children and our elderly. This endowment will ensure that the necessary services will be provided for their well-being.''

Jack Levine, longtime advocate for children's services in a Legislature that has boosted spending some years and cut other years, says the governor's commitment is significant.

``The other thing I'm very optimistic about is his concession that dollars have a key role in investing in quality,'' said Levine, president of the Florida Center for Children in Tallahassee. ``It is not raidable. It will send a message to future Legislatures that this money is off-limits.''

Temptation to spend

The temptation to spend Florida's tobacco winnings on everything but children is huge, House Speaker John Thrasher said. ``Just about every single person who comes in our door has some idea for what's good for the state of Florida, and the way they want to do it is with our tobacco money,'' he said.

Bush's plans will require the Legislature's approval in a session that starts March 2 and should end by April 30. He should have little trouble.

The House and Senate leaders who will negotiate a new, nearly $50 billion state budget will be hard-pressed to resist Bush's plans -- offerings of a fellow Republican leader wrapped in a memorial to a legendary governor. As always, however, they reserve the right to scrutinize the plans.

``A wonderful idea, and a fitting tribute to Gov. Chiles,'' said Senate President Toni Jennings, R-Orlando, informing a dozen Senate leaders later: ``We will take these recommendations on how to spend the money under careful consideration. That's all I obligated us to.''

Financial angle sound

The financial angle is sound, according to the manager of Florida's pension fund. Bush will ask the state Board of Administration, which manages an employee pension fund of $90 billion plus $25 billion the state invests for local governments, to make money with the $2 billion Chiles endowment.

The state already has $1.1 billion on hand, according to the governor's office. This comes from the first installments of the tobacco industry's promise to pay Florida $13 billion over 25 years.

Bush proposes setting aside a share of approximately $450 million that the state will collect each year under the 1997 settlement of the lawsuit with the industry, until a $2.1 billion endowment is created, in 2002.

The state can conservatively expect to earn 8 percent interest, the benchmark expected on investment of the $90 billion Florida Retirement System. The interest alone should yield $126 million for Florida to spend in 2003.

Ken Plante, one of Bush's aides, has quietly pursued the idea of an endowment like this since last year. A lobbyist and former Republican leader of the Senate, Plante signed on as Bush's liaison to the Legislature.

Plante says he worries that the tobacco money might run dry some day, with the industry facing growing obligations from lawsuits around the nation and a new federal lawsuit promised by President Clinton. Should the $13 billion spring stop flowing, he says, Florida still will have its own reservoir.

Copyright 1999 The Miami Herald