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Crist Holds Back 15% Of Revenue

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By CATHERINE DOLINSKI

cdolinski@tampatrib.com

Published: March 20, 2009

TALLAHASSEE - With federal stimulus dollars on their way to Florida - but possibly not quickly enough - Gov. Charlie Crist announced he is holding back 15 percent from state spending in the remaining fiscal quarter.

Jerry McDaniel, Crist's budget director, wrote to state agency heads Thursday that "in light of the current economic climate and in an abundance of caution," the state is holding back 15 percent - almost $800 million - of general revenue that the state was planning to spend in the remaining three months of the fiscal year ending June 30.

Doing so, McDaniel said, will allow the state to "continue managing cash flow effectively" while monitoring the influx of state revenue, which remains in free-fall. In an interview, McDaniel said the governor's office will consider on a case-by-case basis making exceptions to the hold-back, if agencies identify crisis situations.

Holding up spending will also allow the state to make sure it receives federal stimulus dollars in time to patch the state's budget this year.

The federal stimulus package approved by Congress and President Barack Obama last month directs $4.2 billion to Florida to shore up the Medicaid program - including about $1.3 billion for the current fiscal year. It remains to be seen, however, whether the money will arrive in time for the state to avoid a deficit on June 30. Florida's constitution requires the state to maintain a balanced budget.

Getting and spending the stimulus dollars requires an amalgam of state and federal actions. McDaniel said he thinks Florida has access to $817 million of the Medicaid money now, to cover spending retroactively from October 2008 through March. But lawmakers, he said, need to pass legislation appropriating that money in order to use it.

If a worst-case scenario prevails and the state has to make the 15 percent hold-back permanent, that would represent a roughly 3 percent budget cut across state agencies, McDaniel said.

Reporter Catherine Dolinski can be reached at (850) 222-8382.

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