Public universities could save bigger rainy day funds as bill clears Legislature

Historic Florida State Capitol Building with brightly colored striped awnings, classical style dome, and American and Florida State Flags in Tallahassee

The Legislature has passed a bill allowing the state’s public universities to save more money in their rainy day funds to plan for emergencies.

Under the legislation, schools would be allowed to keep an annual reserve balance more than the 7% currently allowed by the state, although the schools must report the surplus to the Florida Board of Governors.

“The Auditor General has interpreted the statute to be a 7% maximum and everything else has to be in a spending plan. That means the universities can only carry forward 7% — no more, no less — every single year,” said Sen. Jonathan Martin, the sponsor of the Senate version of the bill. “We want to encourage savings where possible.”

The bill authorizes a university’s carryforward spending plan to include a reserve fund for certain expenses in the future. If it becomes law, the measure takes effect July 1.

“The funds can be spent for general instruction, student services, public service, research plan operations, furniture, fixtures, equipment, administrative support, minor capital projects,” said Martin, a Fort Myers Republican, during a committee hearing last month.

The Senate voted in favor House version of the bill (HB 707) Friday after the House passed the legislation Thursday.

The bill cleared without any controversy at a Feb. 15 Senate Appropriation Committee, its final stop before getting to the Senate floor.

“We want to encourage savings in the university budgets where possible and not penalize them or artificially incentivize them to spend more money than they need,” Martin said at the time.

During the hearing, Senators approved SB 1128 unanimously with a vote of 17-0, with representatives from the University of West Florida, University of Central Florida, Florida A&M University and all the Florida Board of Governors attending in support of the bill. The Florida Chamber of Commerce also waived in support. They did not comment publicly during the meeting to elaborate why they favored the bill.

“It must be a good bill if you’re all here,” Committee Chairman Sen. Doug Broxson said.

Democratic Sen. Jason Pizzo, who voted in favor of Martin’s bill at a committee hearing last month, steered the conversation to his concerns about homeless students and schools should be allowed to spend more to increase housing.

“For those who are doing the right thing and enrolled in school full time, they shouldn’t have to be sleeping in their cars and in showering school facilities,” said Pizzo, a Miami Democrat. “We should remove those restrictions and allow for beds to be built. So I’m all in favor of this bill, and I hope to expand it in the future.”