TALLAHASSEE -- Worried about Florida’s debt, Gov. Rick Scott warns he may veto more than a $100 million in college construction in the new state budget.
Scott said Tuesday he’s considering vetoing the projects because the added debt of $134 million could jeopardize the state’s strong credit rating and drive up costs of future borrowing.
“I’m clearly focused on the amount of debt the state has,” Scott said. “I’m clearly focused on the debt rating.”
The $69.7 billion budget that the state Legislature approved May 6 and that reached Scott’s desk Tuesday includes dozens of projects at campuses across the state. Vetoing government spending would reward tea party activists, who were among Scott’s earliest supporters.
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Among the college construction projects included in the Legislature's budget are $5 million for a new library at State College of Florida’s Bradenton campus; $6.3 million for remodeling and repairs at New College of Florida; and $162,000 for deferred maintenance at the University of South Florida's Sarasota-Manatee campus.
By far the biggest recipient of new money would be the fledgling University of South Florida Polytechnic campus in Polk County, which stands to receive $46 million.
The project’s champion in the Legislature is Senate Budget Chairman J.D. Alexander, R-Lake Wales, who said he would discuss the issue with Scott.
“I’m not sure he understands the decisions he’s making, but he has the right to make those decisions,” Alexander said.
He said the projects would create short-term construction jobs, while also nurturing high-tech and high-wage jobs for future college graduates that Florida desperately needs.
Miami Dade College stands to receive $10.3million in construction money, and Pasco-Hernando Community College would get $6.9 million for a new Wesley Chapel center.
The campus projects are known as PECO, for Public Education Capital Outlay, and are financed by a 2.5 percent gross receipts tax on electric, gas and telecommunications services.
The program has been in existence for decades, but Scott reiterated he wants to build private sector jobs, as opposed to jobs paid for with tax money.
In warning of a possible veto, Scott cited the advice of Ben Watkins, state director of bond finance, who said Tuesday a slump in gross receipts tax collections has left PECO with “no capacity” for more debt.
Watkins warned Scott that increased borrowing could result in a downgrade of the state’s credit rating by Wall Street agencies, which he said could drive up the cost of future borrowing by hundreds of millions of dollars.
“It’s not catastrophic, but it’s significant,” Watkins said.
Scott, in his first detailed remarks on the new budget, said he’s reviewing the spending plan “line by line” and promised unspecified vetoes.
“There will be additional savings,” he vowed.
Scott said he does not have a target dollar figure in mind, and did not seem concerned that budget vetoes implying a lack of fiscal discipline by fellow Republicans in the Legislature would anger them.
“I have the constitutional authority to veto things,” he said. “I’m looking at every line and saying, ‘Look, is this going to help our state get back to work, or is it going to hinder our ability to get back to work?’”
Scott’s predecessor, Charlie Crist, vetoed a record $459 million in spending from the 2007-08 budget, his first as governor.
Yet even as Scott scrutinizes the Legislature’s spending choices, which he has until June 1 to sign or veto, he laughed off the fact that the state has spent $8,800 for 35 “Welcome to Florida” signs that now list his name in big white letters against a blue background.
“They look nice,” Scott said. “Look, my job is to promote the state.”
Not everyone agrees.
“More like the state is promoting him,” editor James Smith of Florida Baptist Witness wrote in his Twitter account.