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Florida’s Budget Hole Deepens to $3.62 Billion

January 11, 2011 - 6:00pm

Floridas budget deficit got a little larger Wednesday, with a state economist adjusting previous projections up slightly to $3.62 billion. And it could get larger still.

Just kind of tuck that number in the back of your mind, because as you guys meet and make policy decisions, that number is going to be changing, Amy Baker, chief economist for the state Office of Economic and Demographic Research, told legislators during a Budget Committee meeting.

Sen. J.D. Alexander, R-Lake Wales, put the situation in starker terms.

Thats before we have any real provisions for reserves, so it could be a good deal worse, Alexander said, adding that the figure could reach as high as $4 billion.

Despite the budget hole, legislative leaders are maintaining their pledge not to resort to tax increases, and will rely solely on spending cuts to make up the shortfall.

Im going to do it without a tax increase, Senate President Mike Haridopolos, R-Merritt Island, said Wednesday.

Haridopolos was less adamant, however, about Gov. Rick Scotts tax cut proposals, which would add to the shortfall, although he stated he was open to the governors ideas.

Every tax cut must be met with appropriate spending cuts. If (Gov. Scotts budget proposal) has tax cuts in it, Im sure itll include offsetting spending cuts, Haridopolos said.

As a candidate, Scott had pledged to corporate tax cuts and a 19 percent cut in property taxes. His budget proposal will be issued to legislators next month.

Meanwhile, legislators are looking for ways to cut spending, and have targeted Medicaid and education as prime targets. Medicaid spending has gone from taking up 19.5 percent of the state budget in fiscal 2007 to an estimated 28.9 percent in the current fiscal year.

Sen Joe Negron, R-Stuart, is leading the charge for Medicaid reform as the chairman of the Health and Human Services Appropriations Committee. While federal spending accounts for 65 cents of every dollar spent on Medicaid in Florida, the percentage of federal funding is expected to drop to 56 cents for every dollar next year.

It all eventually is the debt of all of us as citizens, Negron said.

Adding to the states burden is the Affordable Care Act, the federal overhaul of health care, which will expand the number of Medicaid recipients in Florida beginning in 2014.

Its an absolute disgrace that the solution out of Washington was to expand the Medicaid rolls, Haridopolos said.

Haridopolos also indicated that spending cuts could also be part of any education reform legislation passed this year, which is likely to resemble the controversial SB 6 bill in 2010 that called for merit pay for teachers.

I think were going to see an improved Senate Bill 6, Haridopolos said, adding that he is willing to look at a proposal for voucher programs from Gov. Scott.

Ultimately, legislators are relying on the states economy to bounce back fully from the recession in order to alleviate the budget gap.

Were going to do everything we can to help the governor make Florida the best place in the country to do business. I think he wants to be known as the jobs governor, Alexander said.

Reach Gray Rohrer at or at (850) 727-0859.

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