Crist offers up ideas for balancing budget, sparing services

Miami Herald - 12/19/2008 12:00:00 AM
by Marc Caputo

TALLAHASSEE -- Florida lawmakers can fill a $2.3 billion budget hole by slightly trimming government spending, nearly emptying savings accounts and approving a gambling agreement with the Seminole Tribe of Florida, according to a draft document approved by Gov. Charlie Crist.

Left off the list of options: tax and fee increases -- which could still crop up during the Jan. 5-16 special lawmaking session to balance the budget.

Crist also hopes lawmakers will consider an economic development plan that will help small businesses and also provide a glimmer of positive news as legislators cut the budget.

''It's nice to be able to provide hope,'' Crist said Thursday. ``These are tough times.''

Crist's tentative proposal is more road map than mandate for legislators.

Senate President Jeff Atwater on Thursday ruled out approving the Seminoles gambling agreement, but said he might consider plans to increase fees for government services and licenses.

A DELICATE BALANCE

But if legislators reject too many of Crist's budget-balancing recommendations, they'll have to make deep cuts to schools and healthcare programs that will leave few people happy. Healthcare and schools account for the bulk of the state's general revenue budget, which has the $2.3 billion budget deficit.

During the regular spring lawmaking session, Atwater said his chamber would consider whether to raise cigarette taxes and would review sales-tax exemptions. He said he would favor removing some exemptions, if it could be shown that it wouldn't cost jobs or hurt the business climate.

''I don't know where that source of cash is coming from,'' Atwater said. ``I would applaud him on that but my concern is those would be precious dollars that you might well be needing to keep something else going.''

Lawmakers and staffers say Crist's economic plans aren't fully formed yet. The plans potentially include: a small-business loan program to help firms survive the frozen credit market; expansion of tax credits for firms that increase jobs or keep more jobs in the state; and establishment of an information clearinghouse that would give small businesses access to otherwise costly market data.

TARGETED FOR CUTS

According to the draft budget document, the Legislature can balance the budget with a variety of cuts and budget transfers:

• $565 million by approving a 4 percent across-the-board agency budget cut that Crist ordered earlier this year without legislative sign off. The cuts take just $13 million from health services because Crist said he wants to spare ''the most vulnerable Floridians.'' K-12 education is cut the most: $370 million.

• $318 million by culling unspent money in 37 different special trust fund accounts established for anything from controlling invasive plants to helping disabled travelers to coordinating drunken-driving prevention schools.

• $135 million in earnings from the Seminoles gambling compact that the Legislature has yet to approve.

• $248 million by tapping the budget stabilization fund. This would leave just $424 million in this savings account of last resort.

• $600 million by tapping the Lawton Chiles Endowment Fund. Depending on how the money is accounted for, this withdrawal would leave about $530 million to $765 million in the annuity, which funds programs for poor kids and seniors.

The fund, valued at $2.1 billion in June, has lost much of its value because of the stock market's poor performance. Chiles' family, which initially approved of the transfer, made a surprise announcement earlier this month when it threatened to sue the state if lawmakers depleted the fund.

Crist said he hasn't spoken with the family in months.

''I certainly empathize with what they're going through,'' Crist said. ``But I have to look out for the entire state.''

Two items would involve substantial borrowing:

• $119 million by using unspent construction money, or by bonding construction that was to be built with cash.

• $300 million by bonding prison construction. As of Thursday morning, the state was holding 100,000 prisoners, underscoring the need for more prison beds.