Lawmakers cautious about positive indications about Florida's budget

in Uncategorized by

Initial, positive indications about Florida’s budget for the coming fiscal year could be overtaken by events if the Florida Supreme Court strikes down changes to state employees or the nation plunges over the fiscal cliff, the state’s top economist warned Wednesday.

Speaking to the first meeting of the Senate Appropriations Committee, Amy Baker — coordinator of the Legislature’s Office of Economic and Demographic Research — told lawmakers that the current projection of a $436.8 million budget surplus could still change.

“I think the message is that this is not a large cushion,” Baker said. “It could evaporate on you if economic circumstances turn against us.”

Lawmakers have long watched a decision in the case challenging a 2011 law that required employees to contribute 3 percent of their income to their retirement funds, along with other changes. It could cost the state around $2 billion if the Supreme Court strikes down the law.

A Leon County circuit court judge voided the changes for employees hired before July 1, 2011; justices seemed hesitant about upholding that ruling at oral arguments earlier this year.

But Baker said the so-called “fiscal cliff,” a package of federal spending cuts and tax increases set to take effect on Jan. 1 unless Congress and President Barack Obama can reach agreement, also looms large.

If there is a long delay in reaching a deal — one that stretches past January and into March — it could cost the state as much as $375 million, Baker said, comparing it to the debt-ceiling fight in August 2011 that dragged down the state economy.

Even if there is an agreement, it is likely to include some measures that will reduce estimated state income by hundreds of millions of dollars, Baker said.

“There is no likelihood that Florida will escape from the final decision with no changes to our budget,” Baker said.

The uncertainty has pushed lawmakers who are optimistic about the numbers to nonetheless urge caution. Senate Appropriations Chairman Joe Negron, R-Stuart, told the committee that he wanted to boost the budget stabilization fund, one of the state’s reserves, to $1.5 billion. That’s at least $500 million over where the fund is projected to be, Negron said.

After the meeting, Negron told reporters that might be as much as the Legislature can do.

“You can never have too much in a reserve, but realistically I think $1.5 billion is a reasonable target to shoot for,” he said.

Sen. John Thrasher, R-St. Augustine, said the situation should send a message to advocates for various state agencies in the audience.

“They need to be on notice that there is a lot of uncertainty out there and that this budget if these two things come to fruition is going to be very, very difficult to put together,” Thrasher said. “And I think either one of them could devastating to us.”

Via Brandon Larrabee of the News Service of Florida.


Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including,,, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.