$2.6B Florida Budget Deficit Plan Approved

16 01 2009

Disabled people will soon lose some of the help they’ve been getting to live on their own, school children could have fewer teachers and builders might be unable to finish apartments under construction under an affordable housing program.

Those are just some of the Floridians affected by spending cuts in a $2.6 billion budget deficit-elimination package approved on 1/14/09 by Florida’s Legislature to end a nine-day special session.

The plan cleared the Republican-controlled Legislature with most Democrats in opposition. The bill goes to Republican Gov. Charlie Crist, who has indicated he will sign the measure but is considering some line-item vetoes.

Cuts totaling $1.2 billion most heavily hit education, health care and social services and reduced the current year budget to $65 billion.

The package also taps reserves, shifts money around within the budget, raids trust funds and increases traffic fines. A self-imposed tax on nursing homes will draw down additional federal Medicaid money to more than offset the assessment.

A program that lets 32,000 developmentally disabled people live in their communities instead of institutions is being reduced by another 5 percent after taking a 7 percent cut when the budget was adopted last spring, said Deborah Linton, executive director of The ARC of Florida, an advocacy group. Another 17,000 people are on a waiting list and get no help.

The cut means job and living coaches and an in-home support aide will spend fewer hours every week.

The legislation plugs a hole of at least $2.3 billion in the budget that runs through June 30, with millions to spare in case revenue keeps falling. Collections from sales and other taxes have been dropping because of the national recession and state’s housing industry.

The centerpiece is a budget bill (SB 2A) that passed 27-13 in the Senate and then 74-43 in the House. Both chambers also passed a series of implementing bills.

State agencies and schools were warned about cuts as far back as June, when Crist ordered a 4 percent holdback, so many already have laid off workers, frozen hiring and taken other steps to cut expenses.

The latest cut will reduce per-student spending by an average of $140. That’s 2 percent overall but 4 percent in state money because schools also get local tax dollars.

Most districts are expected to survive by using reserves and cutting expenses. Some, though, are barely making it and officials are worried about more cuts in the next budget year when even bigger shortfalls are forecast.

The Department of Education has identified eight districts with cash balances of less than 2.5 percent in their general funds including Florida’s largest, Miami-Dade County. The others are small rural counties: Columbia, Dixie, Franklin, Gulf, Jefferson, Manatee and Taylor.

Committees in both chambers had considered a provision that would have forced teachers and other employees to take pay cuts if balances dipped below a certain point, but they backed off. Instead, the state will set up financial emergency boards to help troubled districts stay solvent.

Lawmakers justified a $190 million transfer from the state’s affordable housing trust fund to other sections of the budget on grounds that the state has a housing glut.

The shift, though, will leave 36 builders without money to finish projects, said Lloyd Boggio, chairman of the Coalition of Affordable Housing Providers.

Boggio, a Miami builder, is among them. He said they’ve risked $115 million on nearly 4,000 apartment units based on the state’s commitment to provide partial funding. He said there’s a growing demand for affordable housing by people who have lost homes to foreclosure.

“This has never happened before, so nobody knows what it means,” Boggio said. “Clearly we have to look at legal actions.”

Democrats argued that more revenue increases, including raising the cigarette tax and allowing the Seminole Indians to expand gambling, should have been considered to reduce the spending cuts.

“We as a state have to make a determination as to what services we want to actually provide,” said House Democratic Leader Franklin Sands of Weston. “Or do we want to live on the survival of the fittest concept and forget about those people who use medical services?”

Republicans replied that Florida is cutting less than other states and taxpayers also have suffered from the economic downturn.

“We don’t have printing presses to print more money,” said Rep. Kevin Ambler, R-Lutz. “What we have to do is responsibly spend what Floridians give us to spend, and this year it’s less.”

Source: The Associated Press




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