For Crist, lawmakers in session, it’s all about the money in Florida

Mar 5, 2008

Daytona Beach News-Journal–Mar. 04, 2008
Tallahassee Bureau Chief

TALLAHASSEE — Gov. Charlie Crist is an optimist. He makes that clear time after time.

So when Crist helps start the annual legislative session today with his televised State of the State address, he’ll probably offer an upbeat message.

But after the television cameras are turned off, Crist and lawmakers face a challenging two months. Here are some questions and answers about the session:

Q. What is the biggest challenge?

A. In a word, money.

With Florida’s housing market and economy struggling, lawmakers expect to cut about $500 million from the current year’s budget.

What’s more, House leaders said Monday they might have to cut about $2.5 billion to balance the budget for the 2008-09 fiscal year that starts July 1.

Lawmakers will get a better handle on the 2008-09 budget cuts next week, when economists revise their estimates of general-revenue taxes.

Unlike their political cousins in Congress who can run deficits, Florida lawmakers are required by the state constitution to have a balanced budget.

“We don’t have the money,” House Policy & Budget Chairman Ray Sansom, R-Destin, said Monday during a discussion of this year’s cuts. “The money has not come in.”

Q. Where are the tax shortfalls?

A. Lawmakers need to cut programs that are funded with general revenue, a pot of money that includes sales taxes, corporate-income taxes and real-estate transaction taxes.

Economists said in November they expected the state to bring in $25.5 billion in general-revenue taxes this year and $26.5 billion in 2008-09 — though those numbers likely will drop next week.

By comparison, the state received nearly $27.1 billion in general-revenue taxes in 2005-06 and $26.4 billion in 2006-07. That means general-revenue taxes have steadily declined since 2005-06 and might not rebound much next year. At the same time, the state faces growing expenses.

General revenue is used heavily to fund education, health-care and criminal-justice programs. So when the tax collections drop, those programs take hits.

As an example, lawmakers are considering proposals to cut about $92.2 million from the higher-education portion of the budget this year.

Even with such cuts, Sen. Evelyn Lynn, R-Ormond Beach, indicated she is more worried about cuts next year for universities and community colleges.

“I think what we’re going to have to worry about is not this year in (higher education) because everyone was somewhat prepared for this,” said Lynn, the chairwoman of the Senate Higher Education Appropriations Committee. “I think what is going to hurt is what do we do next year — 08-09 — because each day as we’re sitting here the income for the state (is going down.)”

Q. What about other issues during the session, like property taxes and property insurance?

A. Lawmakers focused last year on cutting property taxes. But with voters approving a property-tax constitutional amendment in January, Senate leaders are not expected to pursue more major cuts.

The House and Senate, however, likely will wade back into the property-insurance issue. As an example, lawmakers will have to decide how to handle a rate freeze that is scheduled to expire at the end of the year for customers of the state-backed Citizens Property Insurance Corp.

Q. Is it possible to watch Crist’s State of the State address?

A. Crist moved the speech from its typical midday slot to 6 p.m., so more people could watch it. His office did not have a listing of all stations that will carry the speech, but Volusia and Flagler County residents can see it on WCEU-TV, the public-broadcasting station.