BRADENTON, Fla. — In an effort to reduce the size of Florida's government, Republican lawmakers want restrictive spending caps placed into the state's constitution.
The measure, dubbed "Smart Cap," is similar to Colorado's controversial Taxpayer Bill of Rights.
However, SJR 958 by Sen. Ellyn Bogdanoff, R-Fort Lauderdale, chair of the Senate Finance and Tax Subcommittee, uses a different formula and includes revenues used to pay debt service on bonds issued after July 1, 2012.
In a pre-session meeting Thursday, the Senate Rules Committee cleared SJR 958 to begin the formal review process during the upcoming regular session, which begins March 8.
The joint resolution calls for a constitutional amendment to place the spending caps into law. The process to get it into the constitution requires both chambers of the Legislature to approve it by a three-fifths vote during the regular session, which is easily obtainable since Republicans control both chambers. After that, 60% of voters in a statewide referendum would need to pass it.
In several pre-session committee meetings, the joint resolution has passed along party lines with Democrats concerned about whether the cap could damage the state's triple-A rating as well as cause the state to lose future flexibility to deal with changing conditions.
Republicans pointed to the fact that in flush years during the real estate bubble, lawmakers spent incoming revenues and grew the size of government unnecessarily, often using one-time revenues for new recurring programs.
In the committee meeting last week, Bogdanoff said she did additional research into the potential for SJR 958 to affect the state's rating. She cited details that analysts use to examine the state's credit and said that she felt there would be no impact to the ratings.
Sen. Gwen Margolis, D-Sunny Isles, was still concerned about the state's ratings, as well as including debt service in the revenue cap.
"This is a very big step," said Margolis, a member of the finance and tax subcommittee. "I can't buy into something that has no economic information, no [experts] who are telling us that this is correct."
The committee heard unions, AARP, and the Florida League of Women argue against the measure. Some felt it would be harmful because of the state's fast-growing elderly population. Others said the cap would prevent the state from responding to rapid economic changes or catastrophes. One speaker said Florida is already among the states with the lowest taxes. The Florida Chamber of Commerce supported the measure.
"It is a philosophical issue as to whether we continue to build debt," Bogdanoff said in response to questions about including debt service in the cap. "People can overextend themselves — that's what's happened to the nation as a whole."
Not including debt service in the cap would favor the use of debt as opposed to pay-as-you-go, she said, noting that the bill is structured so that there are areas of the cap that can be addressed to meet changing conditions, such as removing debt service from the cap if need be.
