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Florida Gov. Rick Scott proposes $74 billion budget with new money going into tax relief

TALLAHASSEE — Florida Gov. Rick Scott on Wednesday proposed an election-year budget of $74.2 billion that spends much of a surplus to roll back auto tag fees and relies on higher property tax collections from homeowners to boost school spending.

Facing a tough re-election challenge in the biggest race for governor in the country, Scott seemed to be focused on the fall political calendar. He used his budget rollout to hit politically popular themes and to draw a vivid contrast between his record and that of his predecessor and likely opponent, Charlie Crist, an ex-Republican running as a Democrat.

"Florida was in a hole, and for four years, there was just more digging," Scott said. "Today, all that has changed."

He called his education budget "historic" by focusing on the bottom-line budget figure of $18.84 billion. But that doesn't tell the whole story.

Some of the increase is needed to absorb an expected influx of 12,500 new students next year and to comply with class size limits in the state Constitution.

In addition, less than one-third of Scott's proposed increase in K-12 spending comes from state revenue. The rest comes from homeowners because of an increase in property values — a reflection of a stronger economy that Scott takes credit for at every opportunity.

Every year, the governor and Legislature must set a property tax rate for the local share of school spending that appears on homeowners' tax bills. Scott's budget would keep the rate at the same level as last year, and growth in property values will generate $375 million more money.

"It's a tax increase," said Sen. Bill Montford, D-Tallahassee, who frequently compliments Scott and heads a statewide group of superintendents.

Scott's budget boosts per-pupil spending to $6,949, or $169 more than the current level but still $177 per pupil short of the record high of 2007-2008.

Crist, who followed Scott at the annual meeting of reporters and editors hosted by the Associated Press, said Scott has been "a historic failure" on education.

Crist pointed out that Scott proposed a $3.3 billion cut to schools in his first year in office before proposing $1 billion increases each of the past two years. And when Crist was governor, he too relied on growth in local property values to pay for more school spending.

Republican legislative leaders endorsed Scott's call to freeze college tuition and for a package of fee and tax cuts totaling $500 million. They want to reduce auto tag fees to pre-2009 levels, saving a typical motorist $25 a year, and by fractionally cutting the sales tax businesses pay for rent.

"It's long needed and overdue," House Speaker Will Weatherford, R-Wesley Chapel, said of the fee cuts, a view shared by Senate President Don Gaetz, R-Niceville.

All 120 House members and half of the 40 senators are, like Scott, up for re-election in 2014.

Scott has never gotten all that he wanted from the Legislature, and it's clear that his fellow Republicans have their own priorities, most with as-yet unknown costs, such as expanding a corporate tax credit scholarship program, offering free scholarships to National Guard members and strengthening laws against sex offenders.

Scott also wants another small reduction in Florida's corporate profits tax, by increasing the exemption from $50,000 to $75,000, which would eliminate the tax for another 2,000 businesses.

The governor proposes two sales tax holidays, one for 10 days for back-to-school items and another for 15 days for hurricane supplies.

Scott's budget also would sock away $5.1 billion for reserves and emergencies and pay down state debt by $170 million more, on top of the $3.6 billion debt reduction he said he has achieved.

After three years of steadily reducing the size of the state work force, Scott now wants to keep state employment at current levels. His budget has a net reduction of 57 full-time jobs in a work force of 111,000.

Scott is asking for hundreds of new child welfare workers at the state agency plagued by a series of child deaths over the past year. He would grow the prison budget by $144 million and by more than 500 workers to staff five small prisons that must house a projected influx of new inmates.

State workers would not get an across-the-board pay raise in Scott's budget. Instead, about a third of state workers could get "discretionary bonuses" of $2,500 to $5,000.

Scott made no reference to his decision last year to support Medicaid expansion under the federal Affordable Care Act. Since he made the announcement, he has all but abandoned any attempt to persuade legislators to draw down $51 billion in federal funds over 10 years.

One of the biggest cuts in his budget is at the Agency for Health Care Administration, which runs the Medicaid program. AHCA has a $678 million reduction because the state will no longer receive federal money under the Affordable Care Act to pay more to doctors who treat Medicaid patients. The program is expiring.

Times/Herald staff writers Mary Ellen Klas and Tia Mitchell contributed to this report. Contact Steve Bousquet at or (850) 224-7263.

Highlights of Scott's budget proposal

. Education: $542 million more for K-12 schools, funded mostly from growth in local property tax revenue, or $169 more per pupil.

. Fees: $500 million in fee and tax cuts, including $400 million to reduce auto tag fees; $100 million sales tax cut in business rents.

. Children: $32 million to hire 447 child protective workers in the Department of Children and Families.

. Debt: Reduction of outstanding state debt of $170 million.

. Prisons: $144 million increase, partly to open two new re-entry centers and three prison work camps.

. Water: $130 million for Everglades and water projects; $55 million for springs protection.

. Technology: Creation of new Agency for State Technology at cost of $3.4 million.

. Workers: Net loss of 57 full-time jobs, the fewest in any Scott budget proposal.

Source: Governor's Office

Florida Gov. Rick Scott proposes $74 billion budget with new money going into tax relief 01/29/14 [Last modified: Wednesday, January 29, 2014 11:25pm]
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