BRADENTON, Fla. - It could be a lean year for new bond issuance in Florida in fiscal 2009.

With state revenues plummeting, the House has passed a $65.1 billion budget without any debt service for new bond programs.

The Senate budget included debt service for $924 million of new public education capital outlay bonds as well as $300 million of Florida Forever conservation bonds, said Eliza Hawkins, with the Senate Fiscal Policy and Calendar Committee.

Budget conferees were appointed late last week and initial negotiations got under way immediately.

On Thursday, conferees agreed to authorize $300 million of revenue bonds for the Florida Forever program. But no agreement has been reached on the state's Comprehensive Everglades Restoration Plan bond program.

In February, Gov. Charlie Crist recommended a $70 billion budget with more than $2 billion of new debt, including $1 billion for education, $625.7 million for transportation projects, and $100 million for Everglades restoration.

Crist's budget was based on much higher general revenue estimates than the House and Senate had available after updated revenue estimates were released in March, Hawkins said.

Lawmakers have until May 2 to iron out the budget and they are looking at cutting programs, reallocating funds set aside for other purposes, dipping into reserves, and implementing new programs to increase revenues. Fiscal 2009 begins July 1.

Last week, lawmakers agreed to trim one program giving Floridians a break on the state sales tax and they cut a similar tax break program altogether. A third appears headed for the chopping block as well.

A long-running program offering a state sales tax break on school clothes and related items will now be seven instead of 10 days long. And unlike years past, the tax break will not apply to books. Lawmakers also agreed to cut from the budget a week-long break on sales taxes for the purchase of hurricane supplies, and they may also cut a month-long program that in the past lifted state gas taxes at the pumps.

In addition to paring back the amount of debt that will be issued in fiscal 2009, which appears to include bonding for transportation projects, lawmakers are discussing diverting funds from the state transportation budget to other programs.

A novel approach to drum up some funding for transportation has been suggested by Sen. Dan Webster, R-Winter Garden.

Webster's plan, called "Investing Florida Money in Florida," would use the Lawton Chiles Endowment Fund to lease the state toll road known as Alligator Alley, which links South Florida's east and west coasts.

The state deposited its tobacco settlement proceeds into the Chiles Endowment, but spends only interest income off the principal to fund children's health programs. The endowment fund currently is valued at $2.3 billion.

Webster is proposing to take $500 million from the Chiles Endowment to lease Alligator Alley from the Florida Department of Transportation. The endowment would be paid back over as many as 50 years through increased tolls.

Although the FDOT currently is looking into leasing the alley through a public-private partnership, Webster said his proposal would keep the toll road in state hands.

Webster said he planned to introduce his proposal this week through an amendment to SB 1978, a major transportation measure.


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.