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Florida legislators face tough choices in a budget-crunching year
Florida's lawmakers will gather at the budget-battered capital this year to confront a financial mess – but even so, they vow not to raise taxes.
Federal stimulus money runs out midway through the fiscal year, blowing a billion-dollar hole in the budget. Avoiding tax increases could mean cuts to state services, from courtrooms to state roads, and widespread layoffs.
"We're spending a lot of time between the rock and the hard place," said Sen. Dan Gelber, D- Miami Beach. "There's billions of dollars in our budget of stimulus money that will be gone in a year. Someone will have to explain what we do when that happens. We've already cut teachers. We've already cut services."
Even as the national economy is showing improvement, Florida is once again facing deep deficits and difficult choices. Yet again, the budget will dominate the agenda in Tallahassee this spring, which is Gov. Charlie Crist's last in the governor's mansion.
In an election year, Republican legislative leaders have ruled out any new taxes or fees. That's a major shift after two years in which they raised taxes and fees on everything from cigarettes to auto tags to speeding tickets.
"The people of Florida do not have one more dime to send us," said Senate President Jeff Atwater, R- North Palm Beach.
The governor is expected to roll out his budget proposal Friday. The Legislature will then spend the two-month legislative session that begins March 2 haggling over spending details, with a final agreement likely to come in late April or early May.
No one is quite sure how deep Florida's budget hole will be. It could be as little as $1 billion or more than $3 billion, depending on whom you ask.
Either way, the recession has taken a toll. In the past three years, legislators have cut about $7 billion to align state spending with falling tax receipts, a figure that would have been far bigger but for federal stimulus money.
President Obama's $787 billion stimulus program included a bailout for state government, money that is fused into Florida's schools and health-care budgets. The money dries up in December.
Nonetheless, state legislators are relying on federal largesse again. Congress is considering extending stimulus benefits for Medicaid, the federal-state program that provides health coverage to the poor and disabled. The extension would save Florida legislators almost $1 billion, helping them avoid the deepest cuts.
Still, 2010 will be the year when Florida's budget hits rock bottom – and stays there. With unemployment reaching a 34-year high of 11.8 percent Friday, chief economist Amy Baker warned lawmakers it will be spring 2011 before normal growth rates in tax receipts of 3 to 5 percent return.
"We're going to hover around the bottom for a while before we start to pick up," she said.
In the meantime, lawmakers are preparing to get by with more cuts. They won't come easily. Florida collects only about a third of its budget – $22 billion in general revenue – which it can cut. But 54 percent of that goes to education, which lawmakers are loath to touch. The rest of the general revenue pays for Medicaid and other health care and social services, runs courts and prisons, and operates a sprawling state bureaucracy.
The rest of the budget – roughly $45 billion – comes from other sources, including the federal government and state investment and trust fund accounts allocated to specific programs. Last year, legislators raided trust fund accounts to help pay the state's bills, but their ability to draw more money from those funds is now limited.
Lawmakers appear ready to drop the budget axe on one group that's largely avoided cuts: 105,000 state employees, not counting those at state universities. Top legislators are pushing layoffs and the elimination of free health-care premiums for about 26,000 mostly white-collar state workers.
Republican Sen. J.D. Alexander, who leads the budget-writing Ways and Means Committee, said he thinks the state can craft a budget that doesn't raise taxes or cut school funding.
"It'll be a difficult task, but one that we're up to," he said.
Not just schools are feeling the pinch, however. With 101,000 inmates, Florida's prisons are packed. Courtroom dockets are so crowded, public defenders report hauling their documents in shopping carts rather than briefcases. Courts could be a prime target for cuts, because they're not covered under the federal stimulus program.
"We are down to core mission and bare bones," said state Sen. Victor Crist, R- Tampa, who writes the budget for courts and prisons and warned of "shocking" cuts to the courts. "There's going to be a lot of anxiety over the next 90 days."
Rep. Keith Fitzgerald, D-Sarasota, offered gallows humor on Florida's predicament.
"We were joking the other day, maybe we should increase our homeland security by taking our tourists and shaking them upside down. Hire pickpockets," Fitzgerald said. "We were Ground Zero of the international financial collapse. We have a steeper hill to climb than most people. This will not be a session where people start passing around money. There's going to be a lot of conflict over how the cuts are made."
Josh Hafenbrack can be reached at jhafenbrack@SunSentinel.com or 850-224-6124.