State Agencies Present 2009-2010 Budget Proposals To House Government Operations Appropriations Committee

Nov 5, 2009

The Florida House of Representatives’ Government Operations Appropriations Committee (“Committee”) met on November 3, 2009, during which it heard testimony from various agencies regarding their budget proposals for the 2009-2010 fiscal year.  Among the State agencies to present were the Department of Financial Services (“DFS”), Office of Insurance Regulation (“OIR”), Office of Financial Regulation (“OFR”), Department of Management Services (“DMS”) and the Department of Revenue (“DOR”). To view the complete meeting packet, click here.

Each agency was required to submit a budget reflecting a 10 percent reduction in recurring revenue. Chairman Representative Alan Hays noted that the Committee is not required to follow the recommendations of the presenters.

Prior to testimony from the agencies, Michelle Robleto of DMS reported on the impact of federal healthcare legislation on Florida and its employees. Those who are eligible for the newly-created (but unregulated) “Insurance Exchange” could trigger a potential penalty for the State. The Insurance Exchange is an alternative marketplace in which small employers and others can help employees purchase health care plans.

Three currently-circulating federal excise and premium tax bills relating to the Insurance Exchange could add additional financial burdens on Florida. The potential impacts of these bills cannot be determined until a final bill is passed into law.

A DOR representative reported that the agency is as lean as it can get and thus is making no staff reductions. State Representative Kevin Ambler asked a series of questions expressing his concerns, which included measuring staff performance, the purchase of untaxed goods over the Internet and the loss of revenue to the State from digital downloads. The DOR official noted that Florida law does not provide for the taxation of digital downloads.

DFS Director of Legislative Affairs Michael Carlson presented his agency’s budget reduction suggestions, which included staff reductions totaling $193.6 million.

The OIR budget reduction suggestions were presented by Chief of Staff Audrey Brown.  While the OIR’s proposed budget would eliminate 14 staff positions, it did not meet the Committee’s 10 percent recurring expense reduction requirement.  As a result, Chairman Hays suggested that the OIR should once again present its budget during the Committee’s December Interim Meeting.  Ms. Brown noted that the requested additional budget reductions could only be achieved by an overall staff reduction of 50 positions.

OFR Chief of Staff Thomas Cardwell provided the budget reduction request for his agency.  Most of the OFR’s recommended $4.3 million in budget cuts were generated by staff and salary reductions.

A DMS representative recommended budget cuts totaling $36.3 million.   Nearly 70 percent ($249 million) of the DMS budget is comprised of pass-through dollars used to fund Florida’s utilities, pension benefits, telephone and data services.  Chairman Hays noted that, while the proposed DMS budget is unacceptable, pensions would not be cut.


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