BRADENTON, Fla. - Facing some grim facts about the state of Florida's economy, the Legislature opened a special two-week session Monday to cut the budget.
In addition to lower-than-expected revenues that have helped create a projected $2.3 billion deficit through the end of fiscal 2009, lawmakers learned that unemployment is at record levels and the use of food stamps is rising with many newcomers entering the entitlement program.
And worse news was delivered Monday by Senate President Jeff Atwater, R-North Palm Beach.
"The recently reported revenue collection numbers for December showed an additional $100 million decrease below the revenue estimate that was just forecast in November, with expectations that this trend will continue," he said. "The gravity of our current fiscal situation is clear: we are spending money we simply do not have."
Underpinning budget problems are some areas over which lawmakers may have little or no control.
Atwater said the jobless rate hit 7.3 % in November, representing 680,000 people out of work. In the last 18 months, 500,000 additional Floridians began using food stamps, bringing the number of users to more than 1.7 million, or nearly 10% of the state's population. On top of that, Florida has the nation's second-highest home foreclosure rate.
Atwater told senators that they must determine if every expense in the budget is critical.
"If it's not absolutely critical to teaching, housing, feeding, transporting, protecting, caring, or creating jobs for Floridians, then now is the time to challenge it, and now may be the time to suspend it or eliminate it," he said.
Florida's constitution requires a balanced budget. But because the state does not have a personal income tax, the budget is supported solely by revenue from other sources and relies largely on sales taxes and fees that have plummeted the past two years.
Gov. Charlie Crist has recommended curing the deficit by using revenue from a controversial Indian gaming compact, dipping into budget and trust fund reserves, making 4% cuts in most agency budgets, and bonding $314 million for prison construction instead of using cash.
Lawmakers have not said if they agree with bonding for prisons, but they objected to using funds the state received from the gaming compact. They have said the agreement - which was struck down by the state Supreme Court - will be addressed during the regular legislative session that starts March 3.
Florida has general obligation equivalency ratings of AAA from Standard & Poor's, AA-plus from Fitch Ratings, and Aa1 from Moody's Investors Service. Fitch and Moody's have negative outlooks on the credit.
