Ben Diamond urges Marco Rubio, Rick Scott to back ‘State Stabilization Funds’

Rep. Ben Diamond sent a letter to Republican U.S. Sens. Marco Rubio and Rick Scott asking them to support $500 billion in funding to shore up state governments struggling during the global pandemic.

The appropriations request was made by the National Governors Association. U.S. Sens Bill Cassidy, a Louisiana Republican, and Bob Menendez, a New Jersey Democrat, are co-sponsoring a bill that tracks with the NGA’s plan.

Diamond, a Democrat who represents St. Petersburg in the Florida House, said Florida’s state budget could be among the hardest hit when the dust settles on the COVID-19 pandemic.

Tourism, and by extension sales tax revenues, make up the backbone of Florida’s budget.

“As you both know from your prior public service in Florida’s state government in Tallahassee, we fund our State budget primarily through sales tax collections. In fiscal year 2017-2018, sales tax collections provided over $24.1 billion, or 77.3 percent of Florida’s total General Revenue,” Diamond said in the letter.

“The impact of the COVID-19 crisis will undoubtedly be devastating to many of our states’ budgets. But because of Florida’s tourism-based economy, and because our general revenue is so dependent on sales tax collection, I anticipate the shortfall the State of Florida will face in our Fiscal Year 2020-2021 budget will be especially dire.”

The letter also pushed back on a suggestion from U.S. Senate Majority Leader Mitch McConnell that beleaguered states declare bankruptcy.

“The services we fund on the State level are vital to the health, safety and welfare of all Floridians,” he said. “Because you have both served in Tallahassee, and because you both have personally wrestled with these challenges in response to the Great Recession, I hope that you will join with others in Congress to support significant additional assistance to state and local governments.”

Diamond, who holds a seat on the House Appropriations Committee, has been sounding the alarm about the fiscal impact of the crisis for weeks.

Last week, he predicted coronavirus’ economic fallout would be worse than the Great Recession and urged the Revenue Estimating Conference to produce an analysis of state tax collections as soon as possible.

Diamond has also made repeated calls for the Governor and Cabinet to meet. His request emphasized public, transparent oversight of a dozen state agencies and the Florida Retirement System, the Florida Hurricane Catastrophe Fund, and funds invested for local governments throughout the state.