BRADENTON, Fla. — Florida Gov. Rick Scott upped his spending and borrowing plans for 2014 proposing the Sunshine state's largest ever annual budget at $74.2 billion.
Branding it Florida Families First Budget, Scott sent to lawmakers a total spending plan that is $4 billion or 5.7% higher than the current year's budget noting that it is the first year since fiscal 2009 the state is not facing a deficit.
Of the total budget, $27.1 billion is the general revenue fund, which Scott said reflects growth of 4.7% due largely to increased sales tax collections. Sales taxes are the state's major source of general revenue because Florida doesn't have a personal income tax.
"Florida Families First, our executive budget for 2013-2014, reflects not only the progress we have made in reducing the size and cost of state government but our continued focus on creating jobs, improving education, and keeping the cost of living low for all Floridians," said Scott, a Republican in his third year as governor.
"After funding the state's recurring expenditures of $24.6 billion, we have around $3.9 billion available to save or invest in our priorities," he said. Scott's budget proposes to spend most of the available revenues.
Scott also recommended the highest amount of borrowing since taking office: $730 million of bonds for transportation-related projects. In prior budgets, he recommended $217 million of bonding in 2013 and $331 million in 2012.
The state will offset the new debt with the scheduled repayment of over $1 billion of existing bonds in the coming fiscal year, he said, adding that Florida has "cut state debt by $2 billion" the past two years. Most of that savings came from refundings.
As for his budget plan, Scott wants to eliminate 3,647 state jobs or 3.1% from the current total workforce of 117,930. He's asking lawmakers to approve employee "bonuses" as opposed to salary increases. Each state worker with a satisfactory evaluation would get $1,200, and there would be limited discretion for employees with commendable and outstanding evaluations to get bonuses between $2,500 and $5,000.
The top two priorities of the upcoming budget are the continuation of tax relief for businesses and the return of more educational funding, Scott said. School funding has been cut for several years.
For businesses, Scott wants to increase the corporate income tax exemption to $75,000 from $50,000, which will affect 2,000 businesses and cost the state $20 million annually. Another measure would eliminate the 5% sales tax that manufacturers pay on the purchase of equipment, which would cost the state $115.3 million in recurring funds.
After touring the state to hear from parents and educators, Scott said his second major priority area is increasing the K-12 education budget by $1.2 billion to a total of $10.7 billion. Most of the increase, $480 million, would go toward teachers' raises of $2,500. Another $297 million would go toward the unfunded liability for teachers' pensions in the state's retirement fund.
Republicans, who control the Legislature, were largely quiet about the governor's budget proposal.
"As I predicted, the governor's proposed budget smacks of pre-election year gimmicks," said Senate Democratic Leader Chris Smith, D-Ft. Lauderdale. "While I'm glad that he now appears to have seen the error of his ways, many of the groups and areas — public school teachers, state employees, higher education — for which he's suddenly developed a new found affection are the very same ones that have borne the brunt of his deep cuts over the past two years."
Smith said the teachers' raises proposed by Scott are less than the 3% they've been required to contribute to their pensions the last two years. Smith also said the proposed budget ignores federal law because Scott refused to expand Medicaid.
While Scott is proposing to use some extra cash in 2014 for environmental programs, which used to be part of the annual bonding program, the upcoming budget again proposes no bonding for public education capital outlay. Scott said there is no bonding capacity in the gross receipts tax, which secures those bonds.
The borrowing plan proposed by Scott consists of $368.1 million for Florida Turnpike projects, $164.1 million for Florida Department of Transportation right of way acquisition and bridge construction, $56.2 million for FDOT's State Infrastructure Bank, and $141.2 million issued by the Florida Ports Financing Commission by leveraging DOT allocations over 30 years.