First, the good news: Florida’s fiscal forecast hasn’t changed much since the last time state economists met in December.

Now, the bad news: The state’s still facing about a $2.2 billion budget shortfall in its general revenue collections.

In December, the economists estimated about $22.5 billion in sales and other tax collections for 2010-2011.

Now, the legislature’s Bureau of Economic and Demographic Research is predicting that tax collections and other fees will bring in about $2.2 million less than the December projection, close to the Department of Revenue’s estimates that the collections will come in about $65.9 million short.

But Gov. Charlie Crist’s office is revising its estimate in the other direction, a reflection of the governor’s perennial optimism.

Crist’s budget gurus think the state will bring in $257.3 million more than they previously anticipated.

The revenue estimating conference will meet throughout the day and provide their final prognostications this afternoon.

But Gov. Charlie Crist’s office is showing about the about meeting with Gov. Charlie Crist’s budget gurus and the Department of Revenue’s economists

Republican House Speaker Larry Cretul is not counting on $1 billion in Medicaid that many believe the state will receive from the federal government. Less surprising, the House also does not include $433 million from Gov. Charlie Crist’s would-be gambling compact with the Seminoles.

Budget writers will use allocations to begin drawing up the state’s spending plan for next year.

Cretul is instructing his chamber to find state dollars in the K-12 budget to replenish the $778 million drop-off in property tax collections caused by spiraling home values. He is also insisting that federal Medicaid dollars Crist counted on for his budget be supplanted with state money. Cretul wants 5 percent of the budget in reserves and no new taxes.

“I know budgeting this year will be very difficult,” Cretul wrote in his memo. (Read it here.)

After taking billions of dollars in federal economic stimulus money to balance the state budget last year, Senate President Jeff Atwater and House Speaker Larry Cretul along with other GOP lawmakers are demanding that the federal government balance its budget to put an end to the escalating federal deficit now surpassing $12 trillion.

“Unless something is done with Washington’s irresponsible fiscal behavior, Florida’s economy will drown in debt,” Atwater, R-North Palm Beach, said at a press conference this morning.

Atwater and his cadre want the feds to balance the nation’s budget as Florida lawmakers are constitutionally required to do in the Sunshine State.

But that didn’t stop the legislature under Atwater and Cretul from accepting at least $12 billion in federal stimulus money - more than $3 billion used to balance this year’s Florida budget and nearly another $6 billion plugged into next year’s. That money helped add to the nation’s rising debt.

“It’s a gaping inconsistency to take that money happily to fill giant holes in our budget and then turn around and criticize the very people who gave you the cash,” said Rep. Keith Fitzgerald, D-Sarasota.

Sen. Joe Negron, R-Stuart, is sponsoring a joint resolution that, if passed by two-thirds of the Florida legislature, would have the state joining 19 other states asking Congress to convene an amendments convention to propose a constitutional amendment requiring the balanced budget and limit federal lawmakers’ ability to pass mandated spending down to the states.

But Florida lawmakers have done the same thing to local governments over the past decade, forcing them to take up a large share of education spending by passing down mandates and making counties pick up the tab for other items.

Congress would have to call the amendments convention if 34 states make the request. Passage of the constitutional amendment would require ratification by three-fourths, or 38, of the states.

House budget chief David Rivera is abandoning his state Senate run and jumping into the race for Congress to replace U.S. Rep. Mario Diaz-Balart, who’s switching seats.

Rivera, a Miami Republican close to former House Speaker Marco Rubio, made the announcement this morning.

Senate Majority Leader Alex Diaz de la Portilla is expected to get into the race but took an uncharacteristically subtle approach to Rivera’s decision with the following statement, entitled “First Things First.”

With the beginning of the 2010 legislative session just days away and unemployment in the double-digits and a $3 billion budget gap to close, DLP says he’s going to focus on the issues at hand.

The Majority Leader’s primary job is to ensure that Republicans have the votes they need to pass leaders’ priority bills.

“As Senate Majority Leader, these issues weigh heavily on my shoulders each and every day because I know how they impact families and small businesses across our state. It would be unfair to Floridians for me to take my focus off finding real solutions to the problems we are facing and instead turn my attention to my next campaign or career opportunity. As I continue the process of deciding whether to seek higher office, I will not make my decision based on the artificial pressures of time or the actions of others. Instead, I am humbled by the grassroots supports and will continue to receive input from my friends, family and supporters and I will announce my decision when the time is right,” Diaz de la Portilla wrote.

Both of the GOP Cuban-American lawmakers from Miami are term-limited out of office this year.

Senate President Jeff Atwater sent a letter to the state’s Congressional delegation today asking them to back legislation requiring a balanced federal budget like Florida’s own laws mandate.

Atwater, a North Palm Beach banker, is running for chief financial officer.

“Unfunded mandates, insurmountable debt, and unconscionable spending are mortgaging our children and grandchildren’s future. Therefore I ask for your help to protect our Nation’s economic liberty. A strong economy is nothing short of the very foundation on which our Republic stands. That is why we need a Federal Balanced Budget Amendment,” Atwater wrote to Florida’s Congressional delegation leader U.S. Rep. Lincoln Diaz-Balart.

Atwater asks the Florida delegation to sign a “Pledge for America’s Future comprised of spending-related “whereases” that Atwater and his staff crafted on their own, Atwater spokeswoman Jaryn Emhof said.

Here’s a sample:

“WHEREAS, the Federal Government has for too long relied on revenue increases and borrowing against our future rather than on prudent spending decisions within the limits of current revenues, and
WHEREAS, lasting resolution of this nation’s budget deficit can be achieved only by addressing the spending habits of our Federal Government, not by increasing the tax burden under which our citizens already labor.”

Chief Financial Officer Alex Sink and Democratic gubernatorial candidate says she’s going to shrink state government and save taxpayers up to $10 million a year by trimming middle management in her agency.

State workers don’t have to worry about layoffs, though - the former banker she’s going to leave middle management positions empty when current employees retire or resign. It will take up to 18 months to achieve the savings, long after Sink’s time as CFO has ended.

Sink’s announcement today is a continuation of her emphasis on bringing a business-like approach to government.

She recently caught fire from her GOP Cabinet colleague Attorney General Bill McCollum’s campaign for governor for promoting cost savings by cutting back on office supplies, including paper clips.

But McCollum’s own director of administration last week testified before a Senate committee that his office could save $238,000 a year by skimping on office supplies and reusing paper clips.

Sink set a goal of one supervisor for every seven workers, cutting back from a current ratio of one to five in her agency. She says taxpayers could save about $300 million a year if all state agencies did the same.

Many state agencies are already doing what Sink proposes - leaving vacant positions empty - for the past several years because of budget cuts.

Stay tuned to find out what the ratio of middle managers to workers is in McCollum’s office.

With more than 1 million Floridians out of work, Florida taxpayers are footing the bill for the salaries for out-of-state workers.

This time, it’s Florida Lottery vendor GTECH’s workers in Texas that are the beneficiaries. GTECH’s call center is located in Austin and that’s where calls regarding the Lottery’s on-line tickets and other products are answered.

And lawmakers don’t even know how many jobs are at stake in Texas because the private contractors hired by the state to handle call lines won’t give up their number of employees or where they’re located, according to legislative analyst Emily Leventhal.

Sen. Ted Deutch, a Boca Raton Democrat who sits on the committee, asked Leventhal how many of the 16 private call centers were located outside Florida.

Only GTECH’s, she told him.

“And do you know how many people the state of Florida is paying to work in Austin, Texas?” Deutch asked.

“I do not,” Leventhal replied.

“I think that would be worthwhile information for this committee,” Deutch said.

An incensed Senate budget chief J.D. Alexander agreed.

“If they take the cash or check they can tell us what we want to know,” said Alexander, R-Lake Wales.

Last year, the Department of Children and Families got in hot water because the agency’s food stamp contractor, JP Morgan Chase, routed questions about food stamp services to a call center based in India. The vendor stopped sending the calls overseas and instead sent them to Ohio and Illinois.

The head of the state’s tourism agency also earned the wrath of lawmakers last year when lawmakers found out that calls to Visit Florida were being answered in Missouri. The agency later canceled the contract.

Foreclosures could be sped up if lawmakers give the court system about $9.8 million in an era when they’re looking to cut criminal and civil justice spending by up to $500 million this year.

Judge Belvin Perry of the Ninth Judicial Circuit and chairman of the state court system trial court budget committee, told a Senate committee this morning that the courts could set up an “economic default recovery” division staffed by senior judges and hourly workers to serve as case managers until the backlog of foreclosures now clogging the judicial branch is managed.

The new division could be broken up into three tracts for homesteaded, abandoned or commercial properties.

The $9.8 million for the new division would come from the court’s trust fund made up of court filing fees.

Lawmakers increased the foreclosure filing fees last year and they went from $295 to up to $1,900, depending on the value of the mortgage.

“This is a way to take the money that they’ve paid in filing fees to give them the services that they paid for.
About 80 percent of our trust fund is generated by the filing fees in mortgage foreclosures and they’ve gotten absolutely no additional services as a result in the increase in fees,” Perry said.

Perry said that a proposal floating in the legislature that would allow mortgage lenders or banks to foreclose on properties without going through the courts probably won’t have any impact on the cases clogging the courts now.

That’s because current mortgages - more than 500,000 in the foreclosure pipeline already - are based upon contract law and must be dealt with in the courts.

Mortgages would have to be written as trusts for foreclosures to avoid being processed by the courts, he said.

“I think it would be difficult to do,” Perry said.

One brave senator and a few courageous volunteers sampled the controversial prison ‘food loaf’ banned in some states that drew questions during a criminal justice budget meeting last week.

Sen. Arthenia Joyner asked prison officials last week to give her the nutritional value of the culinary concoction - also called “behavior modification loaf,” “nutri-loaf” or “suicide loaf” - used to punish misbehaving prisoners.

This morning, Department of Corrections Chief of Staff Richard Prudom arrived at the Senate committee meeting with two loaves of the questionable meal and the “special management meal” recipe.

The meeting ended without Joyner, D-Tampa, or any other committee member sampling the loaf, which resembles a holiday fruitcake with visible chunks of carrot instead of citrus.

But Chairman Victor Crist gave in when urged to try it and conducted an ad-hoc taste test with a Senate aide, a reporter and a lobbyist.

The consensus: the worst thing about the loaf is its consistency, which one guinea pig likened to “something that’s been eaten before.”

“It’s not real tasty.”

“It doesn’t smell bad.”

“It’s awful.”

The recipe calls for carrots, spinach, black-eyed peas, beans, vegetable oil, tomato paste, grits, water and oats.

DOC’s loaves, baked at the nearby Wakulla Correctional Institution, had an overpowering smell of spinach and a mushy consistency with a bland taste that, while far from a gastronomical delight, did not induce a gag reflex when sniffed, chewed or swallowed.

But Crist said that, with a little gravy and heated up as the recipe calls for, most people probably wouldn’t be able to tell the difference between the loaf and genuine meat loaf.

“I don’t find anything offensive about it,” Crist, R-Tampa, said, “but it’s not something I’d order off the menu.”

After dissing Chief Financial Officer Alex Sink for gloating about skimping on paper clips, Attorney General Bill McCollum appears to have taken a liking to her cost-cutting measure.

Spending less on office supplies and reusing paper clips and file folders could save taxpayers about $238,000 a year, McCollum’s director of administration John Hamilton told the Senate Criminal and Civil Justice Appropriations Committee this morning.

Oops.

Just a few weeks ago, McCollum mocked Sink’s efforts to stop buying non-mission critical office supplies until the end of the fiscal year in June, a savings that she estimates could be $200,000. If all the state followed her lead, taxpayers could save $14 million according to the Democratic candidate for governor.

“While Alex Sink focuses on rationing paperclips and paper products, Bill McCollum is focused on finding solutions to the severe economic challenges we face,” McCollum’s campaign said in a press release late last month.

McCollum’s campaign spokeswoman Kristy Campbell had this to say in response to our blog:

“Attorney General McCollum has remained to curbing wasteful spending throughout his tenure in office. Unfortunately, CFO Alex Sink has consistently used her office for political public relations stunts and for attacking her opponent on the taxpayers dime,” Campbell wrote in an e-mail.

And Democratic Party of Florida spokesman Eric Jotkoff had his own snap:

“We’re glad to see that career politician Bill McCollum is finally showing some concern for Florida taxpayers and eating his wrong-headed attacks on Alex Sink, even if it took some coaxing and cajoling, at least the Attorney General is finally following CFO Sink’s leadership in cutting wasteful government spending,” Jotkoff wrote in a press release.

Read the related article by Palm Beach Post columnist Frank Cerabino, Governor’s race
 an all-out battle 
of self-promotion

By MICHAEL C. BENDER and DARA KAM

Here are some notes from an interview today with Senate President Jeff Atwater, R-North Palm Beach:

FIRST DAY OF SESSION: With bipartisan support to delay unemployment tax payments, the plan is waive the rules and pass it to Gov. Charlie Crist before the end of the first day. The Senate will also name a Jacksonville roadway for the late Sen. Jim King, R-Jacksonville and debate reforms to the Public Service Commission.

Atwater choked up when speaking of the road designation for King, a former Senate President who passed away last summer.

“Though that may seem as ceremonial, for those of us who had the honor of serving with him, it’s far more than that. It’s really,” Atwater said haltingly, on the verge of tears. “It’s important.”

Also on the first day, the Senate will take up changes to the Public Service Commission that will put into effect suggestions from a grand jury report left on the shelf since 1992 to improve the integrity of the maligned regulatory agency.

LAST DAY OF SESSION: What Atwater doesn’t want to happen is another breakdown in budget negotiations and be forced to extend session past April 30. With that in mind, Atwater is planning on planning to encourage more transparency, which would require more time for the budget process

“I’d like to test some things this session and recommend them to the next administration of the legislature,” Atwater said. “Last year we did our very best. So now, we’re going to try to see if we can lay that down in writing.”

Atwater didn’t say if he planned to specifically include the allocation process (when the two chambers decide how much money to spend on broad areas, like education, health care and transportation), but it sounded like he would:

“I would want every bit of the process to be discussed in public and the conversation completed in public.”

BUDGET PRIORITIES: There will be winners and losers. Atwater said he’s not interested in across-the-board cuts and anything that can be considered a job generator will be more likely to get money.

“We will have to go deeper in some places to create any initiative for job creation: incentives, venture capital funding, all of that,” Atwater said. “I don’t know where those places will be or the depth of those reductions.”

The economic incentives could include lowering the bar for some programs already in existence or loan programs for small businesses.

Atwater’s “seed” programs won’t include the $10 million economic gardening loan incentive hurriedly pushed through by Gov. Charlie Crist more than a year ago that still hasn’t gotten off the ground.

“I can’t tell you that we would measure any level of success there,” he admitted. “We may try again a loan program. We may try some more in the area of venture capital. But that’s fair criticism. We’ve got to get them out on the street and get them working.”

(more…)

Bernard

The tri-county area is home to the greatest number of Haitian immigrants and has been ground-zero for state and federal Haitian aid efforts.

Newly elected state Rep. Mack Bernard, a West Palm Beach Democrat who was born in Port-au-Prince where the epicenter of the deadly earthquake struck last month, is heading up Palm Beach County’s delegation in the task force, which will include Reps. Juan Zapata, R-Miami, and Ari Porth, D-Coral Springs, and up to 9 other South Florida lawmakers.

Bernard wants better communication from Gov. Charlie Crist, who he said telephoned him the night of the earthquake on Jan. 12 but hasn’t spoken with him since.

Bernard visited Haiti last week. His sister and her three children are now homeless as a result of the disaster, Bernard said.

Crist should appoint a “Haiti czar” to streamline efforts that could be an economic boon to financially-strapped Florida, Bernard, D-West Palm Beach, suggested.

Read the story here.

“It’s that lack of communication, especially from the governor’s office” that is creating frustration for representatives from the tri-county area, which has the state’s largest Haitian immigrant population and is now on the front line providing aid and resources to the ravaged nation, Bernard said.

A bipartisan House panel rejected Gov. Charlie Crist’s budget proposals, telling his budget chief the governor’s plan was as sketchy as building a household budget on winning the Lottery.

“There’s nothing here that I can use,” House health care budget chief Denise Grimsley, R-Lake Placid, told Jerry McDaniel, Crist’s budget guru.

Democrats and Republicans alike peppered McDaniel about the assumptions built into Crist’s $69.2 billion budget, including $1.1 billion in Medicaid funding that Congress has not yet approved, $443 million for education spending in a gambling compact that the legislature last year rejected, $300 million in local property taxes that 24 counties have not yet levied, and the absence of $350 million to comply with constitutional class size requirements based on a measure that has not even gone on the ballot yet.

“The validity of any decision-making process is always based on the assumptions you make,” said Rep. Rich Glorioso, R-Plant City, chairman of the House transportation committee.

Crist’s assumptions are too iffy, Glorioso said.

“I can’t live with that. If I was doing this budget for myself with these assumptions I would be making a vast mistake. We need a better product soon. What if these things don’t come in? You always plan on a worst scenario…It’s always easier to add back into a budget than it is to come back six months out and do another cut. I’d like to see another proposal without all these basic assumptions in here,” he said.

McDaniel said the governor might offer a revised budget a week or two before the end of session if there was no chance a compact was going to pass. But that didn’t placate House budget chief David Rivera.

“I will tell you that as far as this committee is concerned, we need a budget. We have to work on a budget. I’m disappointed that we can’t start on that budget process together because our assumptions are so far apart,” Rivera, R-Miami, told McDaniel. “I hope that we will have other recommendations before the end of session thinking that it’s always better late than never. But this committee in the House of Representatives doesn’t have the luxury of waiting.”

Legislative leaders-in-waiting Sen. Don Gaetz and Rep. Will Weatherford are heading up a GOP initiative to water down constitutional class size limits approved by voters.

Gaetz, R-Destin, and Weatherford, R-Wesley Chapel, sponsored a constitutional amendment lawmakers are expected to put on the ballot this year that would undo some of the class size restrictions voters approved in 2002.

Floridians have already spent $16 billion to shrink class sizes but plummeting property tax collections - which pay for public schools - have sent lawmakers scrambling to foot the $22 billion-a-year tab for education.

Gaetz and Weatherford, who are expected to lead their chambers in 2012, will reveal details of their proposal at a press conference tomorrow morning.

Gov. Charlie Crist, who is running for U.S. Senate, recently said that he supports undoing the class size restrictions, which have been been introduced gradually and which school officials say costs too much and doesn’t benefit student achievement.

U.S. Rep. Kendrick Meek, a Democrat is also running for the U.S. Senate seat Crist seeks, was the force behind the class size amendment in 2002 while he was in the state Senate.

He isn’t backing down from the limits, which are set to go into full effect by the end of this year.

“Eight years later, Tallahassee officials have not relented in trying to water down hard-fought class size limits while refusing to tackle the special interest bidding that is alive and well in the state capital, ” said Kendrick Meek, who served as Chairman of Florida’s Coalition to Reduce Class Size in 2002.

“Florida families cannot be shortchanged. They simply ask that their children not be packed into overcrowded classrooms. Instead of focusing on misguided priorities, Florida needs a long-term perspective to secure a better future for our children. Implementing the class size limits without delay is critical so our teachers can teach in classrooms where our students can learn. Moreover, it is important to note that our state needs to invest now in its human capital in order to reverse the tide of joblessness for tomorrow’s workers,” Meek said in press release.

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With home sales up and migration into the state climbing, Republican Gov. Charlie Crist pronounced today that Florida was emerging from a historically sluggish economy as he proposed a state budget increase for the first time since 2006.

“Something is starting to percolate in Florida’s economy,” Crist said.

He proposed a $69.2 billion budget for 2010-2011, up 4 percent from the $66.5 billion budget the legislature passed for this year.

Crist’s unveiled his rosy proposal the same day the White House announced the U.S. economy grew 5.7 percent in the final three months of 2009, the fastest growth since 2003.

Performance of the state and national economy is expected to factor heavily in the political fortunes of Crist and President Obama in the coming year.

Story here.

This graphic shows the total budget proposed by Republican Gov. Charlie Crist, how much the Republican-controlled legislature approved and where the final budget ended up for the year.

What it shows is that for all the jokes Senate and House leaders make about Crist’s optimistic budget, his definition of reality hasn’t been too far from their own: Crist proposed less spending than lawmakers initially approved in 2007 and in 2009 both he and the legislature ended up on the same total amount.

Story here

Republican Gov. Charlie Crist unveiled a $69.2 billion budget proposal for 2010-11. It’s a $2.7 billion increase from the current year - and would be the first increase in the state budget since 2006 if lawmakers approve.

“For the first time since I’ve been governor we actually have more revenue coming into the treasury, not less,” Crist said.

Republican leaders in the legislature have brushed off Crist’s rosy budget proposals in recent years. He brushed off the criticism today that his economic outlooks have been “optimistic.”

“It’s a damn good thing, isn’t it? Somebody better be,” he said laughing. “You know, if you had a leader who said we’re going to hell follow me, I don’t want to follow that guy.”

Some highlights from his proposal:

*2.6 percent increase in per-student spending

*10 percent increase in teacher bonuses; new bonuses for teachers based on results from AP exams and International Baccalaureate.

*$50 million for Everglades restoration; $50 million for Florida Forever

*$10 million for solar energy rebates

*$100 million cut in corporate income tax

Budget proposal here. Press handout here.

Story here

Gov. Charlie Crist’s proposed $500 million boost to education spending based on an unlikely gambling agreement is unrealistic, Senate President Jeff Atwater said this morning.

“The numbers that I would see at this moment that were included in that release did seem to be a bit optimistic,” Atwater, R-North Palm Beach, said at a meeting of reporters and editors.

Crist’s $22.7 billion public education budget, released Monday, relies on about $433 million from the Seminole Tribe of Florida now sitting in the bank as part of a deal with the state allowing certain types of gambling at the tribe’s casinos.

But the legislature has refused to sign off on a deal inked by Crist and the tribe and early indications show that an agreement this year remains in doubt.

“We worked hard on a gaming compact and we’re not done but to just plug in the numbers that I saw was rather optimistic,” Atwater, who is running for chief financial officer said.

First, the good news: Florida’s economic woes have hit bottom, the legislature’s chief economist Amy Baker told the Senate yesterday.

Now, the bad news: The state’s unemployment rate is expected to climb to 12 percent as early as Friday when the most recent job numbers are released, Baker said.

And more bad news for lawmakers as they struggle to craft a budget with up to $3.3 billion - about 4 percent - less than they had for this year’s $66.5 billion spending plan.

Although the national recession is over, Florida’s not going to show an economic recovery for at least another year, Baker and University of Florida economist David Denslow told the Ways and Means Committee, which about 30 of the 40-member chamber attended after Senate President Jeff Atwater asked them to sit in.

“We think we’ve hit bottom and we’re going to hover around the bottom for a wile before we start picking up,” Baker said.

The economy will start picking up next spring, she said, but even with normal growth rates, the recovery is coming off a very low base level so the turn-around will be very slow.

It will be three years “before you’re going to be out of the hole on a lot of measures,” Baker said.

Read the story here.

On the other side of the fourth floor rotunda, House Democrats wrote a letter to GOP leaders saying they don’t like their approach in determining what the state’s critical needs are.

They want to look not only at expenditures but at revenues as well. (Translation: higher taxes?)

But that’s not likely to happen on the Senate side.

Atwater, R-North Palm Beach, told his members yesterday he “won’t extract another dollar” from Floridians.

Senate President Jeff Atwater kicked off a meeting detailing the state and the country’s dire economic condition with a stern, no-new-taxes speech as lawmakers prepare another belt-tightening budget.

Atwater contradicted questions about how to close what could be up to a $3 billion spending gap this year, saying the premise was incorrect.

Florida will not spend more than what it brings in, Atwater, R-North Palm Beach, said.

“The people of Florida do not have one more dime to send us. So let me be clear. When it comes to constructing a state budget to meet the critical needs of the people in this state, I am not starting in a hole. I am starting from scratch,” said Atwater, who is running for chief financial officer. “We will not extract one more dollar from the small business owner of the state or from any Floridian’s wallet to accomplish the task.”

Atwater delivered his campaign-sounding remarks to a Ways and Means Committee meeting that he asked each of the Senate’s 40 members to attend. Most of them showed up.

“We should not allow the shrieking cacophony of special interests to drown out this simple fact. We have faced up to and made the difficult decisions. What we have not done and what we will not do is leave our sons and our daughters and future generations of Floridians with an intolerable burden of taxes and debt,” Atwater said, drawing the applause of the GOP members in attendance.

The committee is now hearing from university of Florida economist David Denslow and will hear from the legislature’s economist Amy Baker later.