Spotlight on the States: Florida

This week, our Spotlight on the States series heads down south to beautiful and sunny Florida, a state that has faced its share of budget woes. The state currently faces a $3.6 billion budget deficit (five percent of their 2010 budget) and has an unemployment rate of 12 percent, the third-highest in the country behind Nevada and California.

In an effort to get Florida's government "back to its core functions", as he put it, Gov. Rick Scott (R) recently proposed a budget that he described as “Florida’s first jobs budget”. His proposed budget totals $65.9 billion and is a mixture of both spending cuts and tax cuts. The spending cuts total $4.6 billion (compared to last year's budget) and the tax cuts total $4.1 billion over the next 2 years.

The following are the 4 agencies with the largest cuts to their funding (compared to last year's budget):

As you can see, a large bulk of the current year's cuts (slightly above 75 percent) come from Education. It's also important to note that while many departments will see significant cuts to their funding, some agencies' funding was increased; for example, the Agency for Health Care Administration's funding increased by $1.2 billion.  

Other highlights of the proposal include:

• $1.98 billion in savings from "Operational and Programmatic Efficiencies"
• Medicaid Reform that uses a federal waiver to transfer recipients into privately-run programs
• Elimination of approximately 8,700 jobs state-wide (1,600 of those eliminations are within the Department of Corrections)
• Reduction of corporate tax rate from 5.5 percent to 3 percent over next two years, with complete elimination by 2018
• Reduction of property taxes by $1.4 billion over two years
• $800 million towards “workforce innovation” (“economic development projects and incentives that promote job creation”)
• A move to biennial budgeting

In his presentation of the budget proposal on February 7, Gov. Scott laid out his philosophy:

“Cutting taxes is essential to economic prosperity. We will be the best place in the world to live, work and play...So join me today as we set an example for the nation that you can in fact shrink government, return tax dollars to their rightful owners and create an atmosphere that creates new and better paying jobs.”

Florida lawmakers of both parties complained that the Governor's budget was "skimpy" on details, and some questioned the reasoning behind certain proposals. State Rep. Jose Diaz (R) expressed concern that all of the job cuts contained in the Governor's budget might not be justified by the amount of dollar savings they produce, and Rep. Kelli Stargel (R) said that renamed and revised budget categories made it difficult to tell "how the math adds up". State Senate Democratic leader Nan Rich contended that "the tentacles of this budget will reach the most vulnerable people in our state", and House Democratic leader Ron Saunder warned that the budget "would further stagnate Florida's economy and threaten public safety". There are also reports of some Floridians around the state planning protests of the budget proposal, as well as a group of teachers in Jacksonville protesting the cuts to education.

Others have come out in support of Gov. Scott's budget. Many Republicans, including those in the State House and Senate leadership, have praised the proposal for its focus on cutting spending and lowering taxes. House Speaker Dean Cannon (R) said, "The first and highest priorities of the Florida House are to cut government spending and not raise taxes. I am grateful that Governor Scott shares these goals."

Gov. Scott made headlines again recently when he refused $2.4 billion from the federal government that was supposed to fund a high-speed rail line connecting Tampa to Orlando, because of concerns with potential costs to the state and that ridership would not pay for the line's operating costs. Both Democrats and Republicans criticized Gov. Scott's decision to reject the money, and the Palm Beach Post reported that US Senator Bill Nelson (D-FL) is looking for ways to build the rail project without state government involvement.

The deadline for approving Florida's budget is April 30, and debate is sure to get interesting as the state legislature convenes in March.