| Download a copy of the presentation - Florida: An Economic Overview (PDF).
Budget
According to the presentation, Florida's budget shortfalls are due to:
- Slower population growth
- Loss of wealth from declining home prices and investment losses
- Growing home inventory
- Spreading Credit Crunch
- National and Global Recession
Florida's budget is expected to be $2.14 Billion in the hole this year. According to Amy Baker ""The worst is definitely ahead of us," with experts predicting next fiscal year's budget gap could be $5.8 Billion.
This news came on the heals of a jobs report showing Florida's unemployment rate at 7% for October, higher than the national average of 6.5%. The projections are that the unemployment rate in Florida will reach 8.1% by late summer 2009.
Dealing with the shortfall
In the meantime, the Orlando Sentinel reports on these options under consideration:
- Eliminating as many as 2,356 state government positions including 1,041 layoffs (not inluding the university system)
- Putting 147,000 State employees on work furloughs (two weeks unpaid leave)
- 7% pay cut for most state employees
- Raise the state's cigarette tax
- Alex Sink called for reviewing service fees and ending some sales tax exemptions
- Take more out of Trust Fund accounts such as the Lawton Chiles endowment
Florida Capital News reports on these additional options:
- Merging the Agency for Health Care Administration with the Department of Health
- Raising standards for students to qualify for the Bright Futures college scholarships or suspending the scholarship program altogether.
- Eliminating optional services for poor people on Medicaid.
- Substituting modular buildings for new prison construction
Last year Governor Crist implemented a 4% hold back from agency budgets which also required agencies to come up with plans to handle cuts of as much as 10%.
A sliver of a silver lining?
The presentation does say that the economy will rebound: "By April 2010, growth rates will begin a slow return to
more typical levels."
Also, according to a Florida Capital Report broadcast this morning, Amy Baker's projections do not factor in an economic stimulus package from the Federal Government under the incoming Obama administration.
Pay Attention
A Special Session has been called for January 5-16 to deal with the budget deficit. I urge all Floridians to pay close attention and add your voice to the legislative deliberations. |
