A.G. Gancarski
House Speaker José Oliva issued a stark note of warning in the House Monday.
The state’s budget may need to be reconsidered in light of increasingly worrisome economic circumstances.
Oliva, who had spotlighted potential “panic” before, noted that the stock market had to halt trading given the sell orders cascading in this morning.
“The ten-year yield is at an all-time low,” Oliva said. “There’s some word that the Fed is probably going to move another three-quarter points off the interest.”
“We may be facing a very real challenge here,” Oliva said, noting coronavirus pressures.
House and Senate negotiators are in the midst of trying to hammer out a roughly $92 billion budget for the fiscal year that starts July 1. The legislative session is scheduled to end Friday but already faces an extension because of delays in negotiating the budget.
The economic troubles caused by the coronavirus, known as COVID-19, could play out in some of Florida’s key industries — such as tourism — that account for major chunks of tax revenue.
Uncertainty about the economic impact on Florida adds a new level of complication to the budget negotiations, lobbyist Mark Delegal, a partner with the Holland & Knight law firm, told The News Service of Florida following Oliva’s remarks.
“There’s a lot of uncertainty about the future of sales tax revenues related to tourism and general commerce,” Delegal said.
Not only are people reconsidering vacations in the Sunshine State, Floridians “may be thinking they can do a few less outings and a few more in-home activities while this plays out,” he added.
“The hope is the virus runs its course in the next couple of weeks and we’re back to business as usual,” said Delegal, whose clients range from safety-net hospitals that serve large numbers of Medicaid and uninsured patients to the Florida Chamber of Commerce.
Oliva said that he’d told Senate President Bill Galvano and Democratic Caucus Leader Rep. Kionne McGhee “for us to come together and make sure that before we put this budget in the books, make sure we’re doing everything we can to leave future legislatures with the power to overcome it.”
“I’ll be having those conversations with them later and there will be further updates on that,” Oliva said.
The comments come after a weekend where the House moved to the Senate position on a number of budget issues, including big ticket items.
Florida Forever, the state’s land conservation program, was slated to be funded at $100 million according to the latest from conference committees.
Could there be a haircut though?
Affordable housing is likewise slated for almost full funding at $370 million, with $115 million for affordable housing programs, $225 million for the State Housing Initiatives Partnership (SHIP) Program and $30 million for the Hurricane Housing Recovery Program.
However, that could be up for renegotiation.
Likewise with VISIT FLORIDA, which would receive $50 million, a concession from the Speaker.
The state is going to put $25 million into coronavirus response, a number which is seen as a starting point, not a final number.
With a global recession looking likely, Florida may have to make hard budget choices given the uncertainty of revenue streams ahead. An already delayed budget resolution looks likely to be pushed back further.
Senate President Bill Galvano issued no such declarations on the Senate floor at this writing, but he will meet with media after the Senate floor session.
Gov. Ron DeSantis will meet with media today, where questions will likely be robust on this topic, a crisis that threatens a smooth narrative of his first term thus far.
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Content from The News Service of Florida was used in this report.
