Call a Special Session.
Nov 21, 2008
Florida's Revenue Estimating conference is meeting today and all indexes make it clear that Florida's economy is going from bad to really bad. A freefalling national economy and global credit crisis has meant Florida's economic woes are worsening and our budget shortfall continues to expand. This time our forecasters announced that this year's budget is short yet another billion or so dollars bringing this year's total shortfall to between $2 - 3 billion. In addition to bad budget news, Florida's unemployment rate was released today and it increased to 7 %, the highest jobless rate in 15 years. Florida has been losing jobs faster than any other state, and has the second highest number of mortgage foreclosures in the nation. In fact, the state's economist said Florida has the worst budget crisis in the nation.
This new bad news makes the case for why the Florida Legislature needs to meet in Special Session. In rough waters, we can't expect government to run on auto-pilot. Remember, the billions that must be cut from this budget, is in addition to the more than $5 billion we cut last year. Although the legislature gave the Governor the power to dip in to reserves and trust funds to make up some of the shortfall, there are huge implications in such transfers. Some of those trust funds are already invested and others are inappropriately swept to make up for deficits. Additionally, trust fund money doesn't necessarily reappear each year which means that raiding trust funds to cover shortfalls this year would leave us with an even bigger hole to fill when we meet in March to craft next year's budget.
The Governor already ordered a 4% across-the-board holdback for all agencies earlier this year to make up a portion of the lost revenue. I was concerned with that decision because a holdback is, essentially, a cut, and across-the-board cuts by definition don't allow us to prioritize where reductions can be best absorbed. I think if cuts need to be made, the legislature needs to engage the issue directly and in public, and make sure we are protecting priorities.
So now that the shortfall continues to grow, and economic conditions worsen we need to return to the Capitol and get to work. If billions are going to be cut in services (mostly education and health care), than our constituents have a right to know we were involved in those decisions and observe how the decisions are made. Further, a Special Session will allow the legislature to examine other, related issues that impact Florida's economy and really can't wait. For instance, Florida has one of the very worst unemployment compensation systems in the nation and we owe it to our residents to examine whether we should review those provisions at a time when people need assistance the most. We should also examine if there exist any revenue enhancements that will help soften cuts to critical services and won't worsen Florida's economic condition.
These decisions should not be made by inertia. We need all hands on deck. Let's call a Special Session.