State Politics

Problem unresolved: $6B budget hole

TALLAHASSEE — The oil rig explosion that threatens the Gulf of Mexico also rocked the carefully crafted agenda of the Florida Legislature’s incoming leaders.

For months, Rep. Dean Cannon and Sen. Mike Haridopolos had envisioned using oil drilling leases off Florida’s Gulf coast to fill a $6 billion budget hole expected next year. But as the oil slick washed closer to Pensacola last week, Cannon — on tap to be the next House speaker — conceded: “I think it definitely is a game changer.”

Legislators closed out their 60-day session Friday with a $70.4 billion budget and fears that next year’s financial picture will be worse.

More than $15 billion in federal stimulus aid for Florida over three years will disappear in 2011, leaving gaps in programs that finance schools and health care for the state’s poor and elderly. Meanwhile, the state’s property insurance market and the state-backed Citizens’ Property Insurance Corp. remain vulnerable to a major storm, and Florida’s budget-sapping Medicaid program continues to grow.

“It’s going to be a tough year ahead,” said Haridopolos, R-Indialantic, the incoming Senate president. “There’s not a rosy job outlook. We’re going to have less money with the loss of the stimulus money and, more than ever, my conservative credentials are going to be put to the test.”

Haridopolos took pride in helping steer the Senate to the right this session — during an election year — by pushing through a teacher tenure bill, stricter abortion laws, ballot measures aimed at rejecting federal health care reform and pushing for a balanced federal budget, and a redistricting amendment that would shift the impact of two citizen-backed redistricting plans.

“Not only in Florida, but in the rest of the country, we’re moving in a more conservative direction financially and the Florida Senate is the embodiment of that,” Haridopolos said last week. “You’re going to continue to see that trend in the future.”

But the Republican-led Legislature relied on $2.6 billion in federal stimulus money to fill their $3 billion budget hole. And lawmakers left for next year the job of finding more permanent solutions to Florida’s budget woes.

Cannon, R-Winter Park, called this year’s budget a “major victory” but warned: “We have no assurance we’re going to be able to do that again next year because the federal stimulus money probably will not be available and the economy doesn’t look like it will recover quickly enough to close the gap.”

Adding to their concern: The federal health care overhaul approved by Congress is expected to expand Florida’s Medicaid rolls by at least 1 million people over the next couple of years.

With 2.7 million Floridians already receiving Medicaid coverage, and the state at record unemployment levels, the state’s share of the costs are expected to climb. Although federal dollars will cover the expansion’s early stage, forecasts indicate Medicaid will absorb more than one third of the state budget by the end of the decade.

“If we don’t make some significant reform, it will literally eclipse the budget in a number of years,” Cannon said.

He and Haridopolos vow to bring back the ambitious Medicaid overhaul legislators tried but failed to pass this year. The Senate wanted to find savings by expanding managed care to 19 counties in one year, while the House sought to expand the program to all 67 counties within five years.

The Medicaid revamp, like the oil drilling plan, was never expected to provide an immediate fix to the state’s budget woes, but would have begun a series of gradual changes that could have lasting effects.

“We started the conversation and we’ll be back next year,” said Rep. Denise Grimsley, R-Lake Placid, chairman of the House Health Care budget committee, and an architect of the House Medicaid plan.

Gov. Charlie Crist may give legislators another chance this year to tackle all the unfinished business.

He has threatened to veto the abortion bill, a property insurance bill and large chunks of the budget, such as a $160 million raid on the road building fund. He has also suggested that he may bring lawmakers back into special session to take up anti-corruption bills and ethics reforms aimed at the Public Service Commission.

Crist antagonized legislators earlier this session by vetoing a teacher tenure bill and a bill giving legislative leaders new political campaign funds.

Senate President Jeff Atwater, who is running for a seat as the state’s Chief Financial Officer, said he is “open to’’ a summer special session to take up ethics, corruption and PSC reforms.

Rep. Ron Saunders, D-Key West, blames election year politics for the lack of progress on many tough issues.

“Next year’s not an election year and, after the elections, we’ll see where the state is,” he said. “Hopefully, we’ll be able to start working together because next year we’ve got a deficit that is twice as bad as this year’s and not as much money.”

And with less money, oil drilling may not be dead. After a year of studying the prospects of safe oil drilling by a committee Cannon chaired, neither Cannon nor Haridopolos are willing to abandon the prospect for Florida.

“I’m not going to move forward until every single question has been answered,” Haridopolos said, noting the spill is a once-in-40-years disaster.

Both he and Cannon say they will approach next year’s budget by asking lawmakers to eliminate all nonessential services, postpone construction and pare back projects.

Haridopolos says the agenda will be planned down to the smallest detail. “I’m calling it the shuttle launch,” he said.

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