BRADENTON, Fla. - The Republican-controlled Florida Legislature Friday ended a week-long special session with passage of a $66.5 billion budget for fiscal 2010 that authorizes the issuance of $1.4 billion of new debt.
With the recession taking a toll on revenues, the budget that takes effect July 1 relies on $5.3 billion in federal stimulus funding, $800 million in new fees and cuts, and $300 million for education from an Indian gaming compact, which also passed on Friday but still must be ratified by the Seminole tribe.
The amount of new debt authorized in the 2010 budget is $748.3 million less than what was authorized this year, a decrease largely due to the recession. Florida does not issue traditional general obligation bonds since the state does not collect a property tax nor does it have a personal income tax. As a result all of the state's debt is backed by a specific revenue source and revenues are down.
Florida primarily relies on sales taxes and fees, or such revenue as that collected from the lottery, to back its debt and fund its budget. Sales taxes, particularly those on real estate, have been hit hard in the current economic downturn.
To help fund part of the budget, lawmakers agreed to increase the tax on a pack of cigarettes by $1 on July 1, which is estimated to bring in $800 million in new revenue for health care programs. They also cut the pay of state employees earning $45,000 or more by 2%. Legislators - who cut their own pay in the current fiscal year by 5% - also cut their pay for fiscal 2010 by 7%.
"I am grateful that during these challenging economic times, we have been able to avoid drastically reducing services," Gov. Charlie Crist said in a Web cast to constituents after the budget passed on Friday. "I look forward to carefully considering the Legislature's budget proposals during the next several weeks."
Crist, who has line-item veto power over the budget, also is expected to announce today if he will run for governor again or if he will seek the seat being vacated by retiring U.S. Sen. Mel Martinez, a fellow Republican.
Most of the bonds authorized in the fiscal 2010 budget are for traditional debt-issuing programs. New debt for public education and state environmental programs took big hits.
Bonds for public education capital outlay plummeted to $155 million in next year's budget compared to nearly $1 billion in the current year.
No new debt was authorized for the Florida Forever environmental land purchase program, but lawmakers did include in the budget debt service for $250 million of Florida Forever bonds authorized in previous years. The budget also authorizes $55 million of new debt for Florida Everglades restoration efforts.
"There are no real new bond programs in the budget except for inland protection bonds," said Ben Watkins, director of the state Division of Bond Finance. He said some $103.4 million of new debt for that purpose was authorized to continue cleaning up underground fuel tanks, which the state had done in the past on a pay-as-you-go basis.
The budget also authorizes $115.8 million of grant anticipation revenue vehicles. Garvees have been authorized in past budgets, but the state Department of Transportation has postponed the sale of that kind of debt in past years.
Lawmakers also authorized $616 million of bonds for various road and toll projects, $270.2 million for new prisons, and $110.4 million for the state infrastructure bank.