ORLANDO, Fla. — Florida school districts and local governments should brace for impacts from state budget cuts that could be more than $3.5 billion, according to elected and financial officials at a seminar Friday in Orlando.
Expectations for newly elected Gov. Rick Scott and the Republican-controlled Legislature were a major topic at the annual seminar in Tallahassee sponsored by PFM Asset Management Inc.
“Let me assure you, a $3.5 billion budget hole is a Tallahassee problem and I assure you it’s going to be your problem,” said Tico Perez, founder of Consulting & Business Strategies LLC, a government relations consulting firm in Orlando.
With no federal stimulus funding this year and revenues still depressed because of the economic downturn, Scott has pledged to plug the estimated budget shortage for fiscal 2012 by cutting school property taxes, making dramatic changes in the state’s pension plan and Medicaid, and privatizing prisons, Perez said.
Scott has promised to run state government like a business and to kill Florida’s business taxes. The Republican has no previous political experience and spent $70 million of his own money during the election campaign last year in which he won elected office.
“Rick Scott owes no one and, frankly, he can gore anyone,” Perez said.
The challenge for the new governor will be dealing with legislative leaders who have already said that the gaping budget shortfall will prevent any tax cuts from occurring this year, he said. The annual legislative session begins in March.
Perez warned those attending the seminar that Scott wants zero-based budgeting for every state agency, another measure that could significantly reduce the flow of funds to local governments and schools. He encouraged local leaders to get involved in state issues that would affect them.
“The old adage in politics goes, if you’re not at the table, you’re on the menu,” Perez said. “You are going to see diminished services.”
Scott lacks negotiating skills and already faces disputes with members of his own party that set the stage for challenging times ahead, according to Richard Foglesong, a professor of politics at Rollins College.
Some top lawmakers believe Florida is facing a budget shortfall that could be as high as $4.5 billion, he said.
Scott and lawmakers, like those in other states, must face the fact that taxes cannot be trimmed, he said, noting that Illinois has increased its state income tax and other states are considering that as well.
“No other governor in the United States thinks he can cut taxes and fill the budget hole,” Foglesong said.
Lawmakers should focus on cutting pork-barrel spending and provide funding for projects such as high-speed rail — the “best thing to happen to Florida,” he said.
Scott has not said publicly if he will support the rail project, which is now mostly federally funded. A small portion requires state matching funds.
The new governor has said that he is waiting to receive a cost-benefit feasibility study due next month before he will determine whether to accept future federal funding.
State transportation officials have already spent $20 million in federal funds on the high-speed rail project, mostly on the first leg between Tampa and Orlando. Some funds have been spent on studies required for the second phase from Orlando to Miami.