Revenue forecast may drop $1 billion

Nov 11, 2008

Florida CFO calls for special session

Bill Cotterell
News Journal capital bureau

Pensacola News-Journal–November 11, 2008

TALLAHASSEE – The state budget director said Monday economists might reduce Florida’s already shrunken revenue projections by up to $1 billion next week.

But Office of Budget and Policy Director Jerry McDaniel said he does not expect agencies to lay off employees in this fiscal year. He met with Gov. Charlie Crist for about 45 minutes to go over options and said the governor appears uninterested in any tax increases.

Chief Financial Officer Alex Sink, who has asked Crist to borrow up to $1.25 billion from trust funds to meet operating expenses, said that the Legislature should have a special session in mid-December or early January to grapple with the state’s fiscal woes.

Since any monies siphoned out of trust funds will have to be put back before the end of the fiscal year, Sink said the situation can’t wait until the regular 2009 session starts in March.

“I think if there were going to be any layoffs, that likely would have already occurred from last session’s budget,” McDaniel said.

The general-revenue estimators, a panel of economists and planners from executive and legislative agencies, will meet Nov. 21 to revise projections for the current year and the one starting July 1.

McDaniel said the cut “could be as much as $1 billion for the year we’re in” and initial fiscal 2009-10 projections also will be lowered.

Sink’s fiscal-services director, Kimberly McMurray, wrote to McDaniel on Oct. 30, asking that Crist authorize $1.25 billion in borrowing from trust funds.

Under a previous $750 million authority, her letter said, the state took $300 million on Oct. 17 to head off a general-revenue shortfall – but it now needs another $700 million.

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