A predicted $400 million drop in revenue could scuttle Gov. Rick Scott's tax cut plan
Tumbling financial markets are further clouding Gov. Rick Scott's push for $1 billion in tax cuts as the Legislature deals with a suddenly less rosy financial outlook and less money to divvy up.
State budget forecasters this week said they expect that Florida will have nearly $400 million less for its budget than originally expected and that the "possibility of additional adverse international developments introduces a greater than normal degree of risk to this forecast."
Key state legislators, including the chairman of the Florida Senate's budget writing committee, said Wednesday that the financial turbulence will only make them more cautious about committing money this year, including funding the ambitious tax cut package Scott has sought that would mostly go towards businesses.
"This could be just a blip on the radar screen," said Sen. Tom Lee, a Brandon Republican who chairs the Senate Appropriations Committee. "But we want to make sure we appropriate money so that we are living within our means."
The forecast has bigger implications than just Scott's tax cut, Lee said. It could mean a smaller pool of money for lawmakers to spread around to deal with other priorities like the state's prison system, mental health services and growing Medicaid costs as well. Also, with every state legislative district up on the ballot this year, lawmakers will be competing for money for a myriad of hometown projects.
"We want to do as best we can to achieve the governor's priorities, but it's a team sport," Lee said.
Lee said he worries that if the financial markets don't correct themselves, it could eventually hurt consumer confidence, which can hurt sales tax collections — the state's dominant revenue source. He said legislators need to be cognizant of that while building the 2016-2017 budget and realize they will want to have a comfortable financial cushion. The next revenue estimating report isn't due until August, well after the 60-day session is over and the into the next fiscal year.