TALLAHASSEE — Florida's legislative leaders announced Monday that they will convene an extraordinary two-week lawmaking session Jan. 5 to close the state's widening $2.3-billion budget hole.
The Republican leaders' joint announcement said legislators will focus on cutting the budget and shifting money from savings accounts and other funds, House Speaker Ray Sansom of Destin and Senate President Jeff Atwater of North Palm Beach said in a joint statement. Tax and fee increases, as well as ratification of the gambling compact with the Seminole Tribe of Florida, appear to be off the table until the regular session in March.
"Based on a careful review of the status of the 2008-09 state budget, and after consultation with Gov. Crist's office, we have concluded that it is in the best financial interests of the state" to convene a special session, Sansom and Atwater said in the statement.
Legislators had little choice. The state Constitution forbids deficits. And, after back-to-back years of budget cuts, the full Legislature must convene to make tough decisions about what programs get cut.
For months, as the deficit mounted, Sansom said lawmakers could wait until the regular session in March to close the gap. Atwater, however, warned last week that waiting could harm Florida's credit rating. And Crist, who also had wanted to postpone action, acknowledged last week that a January session might be necessary.
"The budget challenges before us are serious," Sansom and Atwater said in their statement. "We are prepared to meet those challenges. We intend to provide essential services to the citizens in a fiscally prudent way."
Florida's budget currently stands at $66.3 billion — $7.4-billion less than just two years ago. Next year, the outlook is even more bleak.
Based on forecasts of current tax collections, which have precipitously declined, state economists estimate next year's budget hole could be about $5.8-billion — that's after this January's cuts.
The state Senate projects a smaller deficit of $3.8-billion. That suggests lawmakers are ready to make deep cuts that would likely mean the elimination of health programs such as Meds AD and the Medically Needy, which respectively serve poor seniors and the catastrophically sick.
Schools also could face a huge cut next year because property values are swiftly declining. If this year's property-tax rate were held the same, schools statewide would see their spending reduced by $780-million.
"Anyone who depends on the state should be deathly afraid," said lobbyist Ron Book, who represents many local governments as well as private clients.
Florida's Chief Financial Officer, Alex Sink, said that because of the surge in holiday retail sales, state revenue is rising slightly but not enough. She said the special session needs to be a time to reconsider the state's tax system.
"Every sales tax exemption ought to be back on the table, ought to have to see the light of day, Sink said. "Somebody ought to stand up and defend why an exemption is fair and legitimate or it's not."