BRADENTON, Fla. - Some Florida lawmakers and environmentalists are backing a bill that would authorize $2.3 billion more debt to be issued by the Florida Forever program, which purchases land for conservation.

But legislators are dealing with the state's sliding economy, which has been hit harder than most states because of a huge decline in the real estate industry. That, in turn, has chopped billions from revenues supporting the state budget.

Nonetheless, the House Committee on Conservation and State Lands last week passed a bill to increase the Florida Forever bond authorization to $5.3 billion from $3 billion, allowing the state to continue its long history of buying land for conservation and recreation purposes.

"I think this is a very worthy project," said Rep. Will Kendrick, R-Carrabelle and committee chairman, just before a vote was taken on the increased bond authorization. "This is a recommendation we're passing up to" the full House Environment and Natural Resources Council.

The proposed committee bill has yet to be scheduled for consideration by the council. That could be because House leaders on Monday released a proposed $65.1 billion budget plan for fiscal 2009. The new plan would be $6.5 billion less than the current year's original $71.5 billion budget.

But so far because of falling revenues, lawmakers have cut $1.6 billion from the fiscal 2008 budget and they are working on more cuts.

The proposed House budget for fiscal 2009 does not include a bond authorization for the state's current land conservation programs - Florida Forever and Save Our Everglades. If the House plan is passed, it would be the first time in nearly 20 years that Florida would not authorize the issuance of bonds for land conservation.

Florida's land conservation efforts began in 1990 with the creation of Preservation 2000, also known as P2000, a 10-year, $3 billion program with bonds secured by documentary stamp taxes collected on real estate sales. Under the program, the state spent $3.28 billion for 1,781,489 acres of land and $175.6 million for conservation easements on 265,255 acres. A significant amount of debt sold for the program remains outstanding.

When P2000 neared its end, the Legislature created Florida Forever, another 10-year, $3 billion program whose authorization expires in 2010. So far under Florida Forever, the state has purchased 600,772 acres of land for $2.22 billion and purchased conservation easements on 125,933 acres for $140.2 million.

The Save Our Everglades program is designed to provide a portion of the state's costs toward restoring the Florida Everglades. It is an eight-year, $800 million program with two years remaining on its authorization. As of April 2007, the program had spent $711. 2 million and purchased 58,682 acres.

The bonds for all three programs - P2000, Florida Forever, and Save Our Everglades - are secured by documentary stamp taxes collected on real estate sales, although on occasion the Legislature supplemented the programs with cash.

Gov. Charlie Crist and other top lawmakers have said they'll support extending the Florida Forever program, and the Senate's version of the fiscal 2009 budget includes an annual appropriation for bond financing. The legislative session runs through May 2.

But the state's faltering economy is having an impact.

Moody's Investors Serviceon March 19 placed a negative outlook on Florida's general obligation debt rating and certificates of participation, citing a trend of declining revenues just like that which is hitting most states.

The negative outlook affects $13 billion of outstanding debt backed by the state's full faith and credit and $290 million of COPs, rated Aa1 and Aa2, respectively, by Moody's.

Analyst Mark Tenenhaussaid Moody's took the action because Florida is experiencing significant revenue weakness stemming from the state's economic slowdown and continuing deterioration in its housing market, which may be exacerbated by the downturn in the national economy.

Moody's action also came shortly after the state held a revenue estimating conference in which forecasters revised revenue estimates for the current fiscal year downward by $1 billion. It was the third downward revision for a cumulative decline of $3.15 billion.

Florida's general obligation debt is rated AAA by Standard & Poor'sand AA-plus by Fitch Ratings.


Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.