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1969 December 31 - 09:00 pm

MONEY TREE: Fla. Legislative Leaders Warn of More Cuts

TALLAHASSEE, Fla. (AP) — Florida legislative leaders are warning that schools, health care and other programs could get cut again in 2012.

The state’s economy stalled over the summer and now there are dire predictions that the fragile recovery once under way will not materialize as expected.

New estimates floated by the GOP-controlled Florida Legislature suggest that state legislators may be confronted by a $2 billion shortfall next year.

“It’s going to be another challenging year for us,” said Rep. Denise Grimsley, the House budget chief.

Senate President Mike Haridopolos vowed that legislators would resort to budget cuts instead of tax hikes in order to make up the difference.

“We’re not that optimistic at all, but we are going to keep our pledge not to raise taxes, not to raise fees and do our best to make do with what we have,” Haridopolos said.

Lawmakers were confronted with a nearly $4 billion shortfall earlier this year, but they made up the difference by cutting money to schools, trimming back spending on health care programs, eliminating state jobs and forcing public employees to pick up part of their pension costs.

Top Republicans had hoped to avoid deep cuts heading into a crucial election year and even in early September state economists had suggested there might be a surplus in 2012.

But the state’s tax collections starting dropping in July and new estimates show a drop between $1 billion and $2 billion.

Adding to the budget crunch is a continued slide in property values — which means less in property taxes for schools — and expected growth in Medicaid, the state and federally funded health care safety net. Florida’s public schools will also have to deal with the loss of federal money that was used this year to help balance the budget.

Haridopolos acknowledged that schools and health care programs could get targeted again for another round of budget cuts since they comprise some of the largest areas of the state’s $69.2 billion budget.

“When you are making cuts the programs most at risk are education and health care,” Haridopolos said.

Haridopolos, however, was open to the possibility that community colleges and state universities would be allowed to raise tuition rates again in 2012 to offset possible budget cuts.

Gov. Rick Scott and lawmakers this summer ordered state agencies to draw up a proposed list that would cut 10 percent of their agency budgets. Several budget panels this week heard presentations about some of the proposals even though many legislators were skeptical about some of the suggestions.

The budget shortfall could also make it harder for Scott to sell state lawmakers on another round of tax cuts.

Scott has vowed to eliminate the state’s corporate income tax — which this year is expected to generate $1.9 billion — as part of his effort to jumpstart the state’s economy.

One bright spot for state lawmakers is that there is enough in reserves to avoid the need to make immediate budget cuts. Instead it is more likely legislators would approve another round of cuts to take effect next summer.  

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