House, Senate draw battle lines on state budget

Old Florida Capitol building (Sentinel file)

TALLAHASSEE – The House and Senate released initial budget plans Friday with more funding for K-12 schools, cuts to hospitals and major differences in spending on higher education and affordable housing.

Both chambers are close in their bottom-line numbers — the Senate’s plan is $87.3 billion, and the House’s $87.2 billion. But they will have to bridge major gaps to prevent an impasse.

One of the biggest differences is in funding for colleges and universities, where the chambers are $600 million apart.

Senate President Joe Negron wants to provide universities more cash to hire elite faculty and for scholarship programs such as Bright Futures, so his chamber’s budget increases higher education funding by $383 million.

But House Speaker Richard Corcoran has $217 million in cuts in his budget. The House budget also does not expand Bright Futures for “medallion scholars,” to cover 75 percent of tuition, a key part of Negron’s higher education bill the Senate has already passed.

Negron, R-Stuart, said he is confident the two sides will be able to work out their differences.

“What we’re trying to accomplish is national elite destination universities where employers come offer jobs to our students,” Negron said. “I know there’s support in the House and the Senate for medallion scholars, and I sense a willingness to be able to meet in the middle somewhere to get those funded.”

Both the House and Senate increase Pre K-12 school funding by more than $500 million to more than $21 billion. The House version would bump up per student funding by $100, to $7,407, and the Senate plan would go higher, to $7,417 per student.

There also could be a thawing in a heated debate between the chambers over how to pay for K-12 schools.

Corcoran, R-Land O’ Lakes, was adamant last year that allowing higher property values and taxes from new construction to help pay for schools was a tax increase, something he won’t support. But this year the House budget would put increases in property tax revenues derived from new construction, about $192 million, toward the schools budget.

Overall health care system spending would increase by $2.8 billion in both chambers’ proposed budgets, but that includes hundreds of millions in rate reductions for Medicaid providers, which hospitals worry will hit them the hardest.

The fight over the Low Income Pool, a Medicaid program paying hospitals for indigent care, won’t reappear this year, as the federal government’s agreement to pay $1.5 billion per year is reflected in both budget plans.

Gov. Rick Scott’s recommended $180 million tax cut plan, which consists mostly of cuts to drivers’ license fees and a back-to-school sales tax holiday, isn’t in lawmakers’ spending plans yet. But the GOP-led Legislature will likely pass some form of tax cuts during Scott’s final year in office as the governor prepares for a likely run for U.S. Senate.

Another major difference is in affordable housing. The Senate puts the full $308 million expected affordable housing trust fund revenues, which come from real estate sales taxes, toward affordable housing programs. The House, though, dedicates nearly $110 million, and “sweeps” the rest of the balance to pay for other programs.

Democrats and housing advocates say the full amount is needed, not only because an increase in Puerto Ricans coming to Florida fleeing Hurricane Maria’s devastation, but also because affordable housing funds have been used by lawmakers for other purposes over the past decade.

“The reason why we’re in such a deep hole is because they swept [the affordable housing trust fund] year after year after year,” said Rep. Carlos Guillermo Smith, D-Orlando. “Newsflash: More hurricanes are coming.”

The flow of Puerto Ricans coming to Florida could have a ripple effect throughout the budget. Lawmakers are basing their initial spending plans on current estimates of state economists, which were made before the expense of hurricanes Irma and Maria were taken into account.

The House and Senate are expected to pass their budgets in the next two weeks before entering into formal negotiations between the chambers. But state economists will meet Feb. 9 to issue new revenue forecasts, possibly shifting the underlying numbers involved in the talks.

Lawmakers must agree to a budget by March 9, the scheduled end of special session, to avoid returning for a special session, which is what happened last year.

grohrer@orlandosentinel.com or (850) 222-5564

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