Higher sales tax collections and a freeze in Medicaid payments fund bigger spending and smaller taxes.
By STEVE BOUSQUET and JONI JAMES
Published January 21, 2004
[AP photo]
Bush warned of "clouds on the horizon," referring to smaller classes and a bullet train that he said will one day require borrowing, higher taxes or spending cuts.
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TALLAHASSEE - Gov. Jeb Bush on Tuesday sent the Legislature an election-year budget that puts more money into schools and colleges, raises tuition again, restores some spending cuts of past years and trims taxes.
The $55.4-billion proposal is supported by a surge in sales tax collections and a freeze in Medicaid payments to doctors and hospitals. Bush also wants to shift $738-million from special accounts known as trust funds to pay for general needs, a controversial practice that sparked a political furor last year.
Florida's tax-cutting governor wants one more small cut in the intangibles tax on stocks and bonds owned by about 233,000 investors. He also wants a nine-day sales tax holiday on school purchases this summer and a monthlong sales tax break on books in May 2005. They add up to $131-million in tax cuts.
Bush proposes a $1-billion increase in education spending, or 4.5 percent more per student. Half of that, $508-million, would pay to reduce class sizes required under a constitutional amendment Bush wants repealed. The rest covers 55,000 new students expected next year.
"Our government shouldn't grow faster than the income of Florida's families," Bush said. "I know that sounds like a really radical idea, but I passionately believe it."
Bush said that philosophy is why Florida has an image of "prosperity" and avoided the deep budget deficits other states have faced.
Senate President Jim King, R-Jacksonville, said he's "very concerned" about Bush's planned cuts in human services and what King called the use of $1.6-billion in one-time stopgap funds for annual programs.
The Florida Association of Counties called it "astonishing" that Bush wants to cut taxes while trying to shift a bigger tax burden to local taxpayers, including costs of running juvenile detention centers.
Democrats criticized Bush for wanting to cut a tax paid by investors while thousands of children wait for subsidized health insurance.
"It's outrageous," said Rep. Dan Gelber, D-Miami Beach. "He's giving millionaires tax breaks while leaving 80,000 children of working families without health insurance."
Senate Democratic leader Ron Klein of Delray Beach said Bush could wipe out the waiting list for the Healthy Kids insurance program by spending $23-million, which would be matched by a larger federal subsidy. Bush's budget includes money to extend Healthy Kids coverage to an extra 10,500 children, about 10 percent of the waiting list.
In human services, Bush wants to spend $47-million more for child welfare, $44-million more for people with mental disabilities and $21-million more to increase adoptions.
Bush allocated $223-million for the first year of a constitutional mandate that the state pay the full costs of operating trial courts. He also set aside $9.6-million to start paying for a voter-approved initiative for voluntary prekindergarten to 4-year-olds.
The money will be used to train 8,500 child care workers.
In a Capitol room filled with members of his administration, Bush took 75 minutes to explain his budget proposal, joking at the end that he felt like Fidel Castro, known for his long-winded speeches. Toward the end of the speech he also warned of "clouds on the horizon." He referred to smaller classes and a bullet train that he said will require borrowing, higher taxes or spending cuts.
A third threat, Bush said, is the 12 percent annual growth rate in Medicaid, the federal-state health care program for the poor.
Medicaid now eats up $14-billion, one-fourth of the total budget.
Overall, Bush's fiscal 2005 proposal is $1.4-billion higher than the current budget, but many spending increases make up for ground lost in recent budgets, when an economic slump forced lawmakers to make deep cuts in higher education, road building and other services.
Bush's proposal depends, in part, on the state's fattening property tax rolls to improve school funding. Roughly $393-million more will be raised for schools with no increase in the state tax rate for schools.
Bush's sixth budget is a starting point for talks with the Legislature and an array of interest groups. His proposal reflects a consistent philosophy of limiting spending growth, saving as much as possible and encouraging the creation of new jobs.
In a presidential election year in which Florida could again play a decisive role, the president's brother signaled a strong desire to get a budget deal without the overtime sessions and squabbling among Republicans that dominated the sessions last year.
To accomplish that, Bush has signed off on two expensive pet projects sought by legislative leaders: $11-million for an Alzheimer's research institute in Tampa, pushed by House Speaker Johnnie Byrd, and $5.4-million to begin a chiropractic college at Florida State University, advocated by King and Senate Majority Leader Dennis Jones, R-Treasure Island, a chiropractor.
"We need it because it's important to the (Senate) president," said Bush, who in the past has been a critic of legislators' fondness for pork-barrel projects. "It's a part of our tradition. These are not bad ideas, and I will embrace them."
Bush also wants to spend $16-million to revive a tobacco prevention program aimed at stopping teenagers from smoking. The program, paid for with the riches collected from former Gov. Lawton Chiles' victory over tobacco companies, was once a $39-million-a-year appropriation. Over Bush's objections, it shrank to $1-million last year.
The American Cancer Society called Bush's $16-million proposal "a step in the right direction," but not enough. The group said it will ask the Legislature for the full $39-million.
Bush, who dislikes borrowing to pay for programs, wants to spend $100-million for Everglades restoration using cash instead of bonds. He also proposed using $40-million in cash as partial payment of the state's annual $300-million commitment to buying environmentally sensitive land under the Florida Forever program.
But the cash comes from trust funds that support other environmental programs. While lauding the governor's intentions, Eric Draper of Audubon of Florida predicted state lawmakers will borrow all the money needed for Everglades and Florida Forever, then use the cash for non-environmental programs as they have done before.
"I don't want to use the word "raid,' but they're going to take this money that should be spent on environmental programs and spend it on other things," Draper said.
Bush's proposed budget also calls for an extra $22-million for the state's citrus canker eradication effort, $15-million to make Florida a center for research and development of hydrogen fuel cells, and $18-million to upgrade leaky sewer systems that for years have ruined water quality in the Florida Keys.
Florida's 27 smallest counties, most along the state's northern tier, are among the biggest winners in the Bush budget. He wants to funnel $25-million to those counties for road resurfacing projects, and $23-million for wastewater projects and cultural and library grants.
- Times staff writers Lucy Morgan and Craig Pittman contributed to this report.
Bush's budget at a glance
Highlights of the governor's proposed state budget
$55.4-billion in spending, up 2.6 percent or $1.4-billion.
Restoration of a $48-million sales tax holiday for clothing, books and school supplies.
An additional $91-million cut in taxes paid on stocks and bonds.
$477-million in spending cuts, mostly by canceling planned Medicaid increases.
$976-million to reduce class sizes, up $508.2-million.
