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PRESS RELEASE

January 18, 2005

Jacob DiPietre
(850) 488-5394

MacKay Jimeson
(850) 245-0413

Governor Bush Announces 2005-2006 Executive Budget
Fiscal stewardship grows budget, increasing opportunity and security for Floridians

TALLAHASSEE — Governor Jeb Bush today unveiled the Bush/Jennings Executive Budget Recommendations for Fiscal Year 2005-2006 (FY 05-06). The budget recommendations are a continuation of the conservative fiscal management policies that have spurred growth and increased revenues allowing us to boost funding for Florida's priorities. The budget invests in Florida's future with increases in education, economic development and services to strengthen Florida's families, while holding the line on overall spending growth and cutting taxes by $285 million.

"This is a common sense budget focused on Florida's priorities. Our fiscally responsible approach has generated a prosperous economic climate and given Florida the tools and strategies we need to move forward from the challenges of this year and build a better and stronger Florida," Governor Bush said. "With the Legislature's help, we can continue to improve education in Florida, help our most vulnerable and create stronger families and safer communities. I look forward to working with the Legislature on these issues in the coming months."

Florida's current fiscal year budget, including emergency hurricane related and other amendments, totals a little more than $60.6 billion. The Bush/Jennings recommended budget for FY 05-06 is $61.6 billion or an increase of $985 million or 1.6 percent. That figure includes $26.6 billion in general revenue. The Governor and Lt. Governor also recommend maintaining a high level of budgetary reserves at $3.8 billion. Governor Bush attributed the state's budget growth to fiscal stewardship in recent years and to a climate of economic growth. However, he warned that to ensure the state's economic future, the state cannot spend more than it receives.

Despite all the good financial news there remains some clouds on the horizon. Last year Governor Bush and Lt. Governor Toni Jennings advocated for reforms to restrain the growth in the Medicaid budget and highlighted other budget uncertainties related to the implementation of constitutionally mandated initiatives like high speed rail and the class size amendment. The voters defused one of those threats when they repealed the high-speed rail amendment in November. The Governor and Lt. Governor announced their proposal to reform the Medicaid system last week. The remaining threat still looming is implementing the class size mandate. Today the Governor reiterated his concern that the class size amendment is using too much of our education dollars and giving us very little to show for the investment.

"Last year at this time we were facing three serious threats to our long term prosperity," Lt. Governor Jennings said. "While our current financial situation is positive, we still have clouds on the horizon for our long-term fiscal future. Governor Bush and I share the commitment to ensuring we stick to the proven principles that have brought us this far."

Governor Bush and Lt. Governor Jennings' Recommended budget for FY 05-06 includes:

Education

  • K-12: Governor Bush recommends $17 billion for public schools. This is a $1.1 billion, or 7.5 percent, increase for K-12 education. Governor Bush has increased education funding by $5.9 billion, or 53 percent, in the past seven years.
  • Per Student Funding: The Governor's budget recommends spending a total of $6,370 on each of the 2.6 million students in Florida's public schools. During the past seven years, per student funding has increased more than $1,495 per student, or nearly 31 percent.
  • Reading Initiatives: The Bush/Jennings Administration recommends $186.4 million in state and federal funding for Just Read, Florida! and other reading initiatives, a $43.3 million increase over the current year.
  • Voluntary Pre-Kindergarten: The Governor recommends $400.5 million in new funds to create the Florida voluntary pre-kindergarten program. This budget allows us to welcome more than 154,000 four-year olds into their first classroom this fall. We will spend $2,500 per child for either the school year or summer program. The $400.5 million would be in addition to the more than $666 million Florida continues to spend on school readiness programs statewide.
  • Community Colleges: Total funding for community colleges exceeds $1.5 billion, which includes a $82.8 million, or 5.6 percent, increase in direct aid to the colleges.
  • University Funding: The Governor and Lt. Governor plan to invest almost $2.9 billion in our state universities, a 4.3 percent increase over the current year. Since 1998 we have increased funding for these institutions by more than 40 percent.
  • Workforce Funding: The administration is proposing $1.2 billion for workforce education programs across the state. That represents an increase of $102.8 million over the current year. The Governor and Lt. Governor are proposing $24.7 million of these funds for the "Jobs for Florida's Future" initiative to create workforce development programs in public schools and community colleges that target high skill and high wage occupations.

Strengthening Families:

  • Medicaid: Today, Medicaid consumes a quarter of our entire state budget and it is growing at an average 13 percent per year. We cannot continue to sustain such growth.
    While the Governor outlined his reform proposal last week, the Bush/Jennings budget recommendations reflect the kinds of actions that must be taken in the current system to achieve fiscal discipline. The Governor is recommending $14.7 billion for Medicaid, a $707.1 million increase over this year. The funding recommendations include proposals that implement the policy currently in place for Medically Needy, hold the line on rate increases for hospitals, nursing homes and HMO's, and initiate a new method for controlling spending on prescription drugs.
  • Substance Abuse: The Governor and Lt. Governor are recommending more than $301 million be allocated to fighting substance abuse next fiscal year. The recommendation includes $267.1 million for prevention and treatment services, which represents a 7.8 percent increase over the current year.
  • Protecting our Children: The Bush/Jennings budget includes $989 million for child welfare programs next year. That reflects a $568 million or 135 percent increase since the Governor took office in 1998.
  • Developmentally Disabled: Next year, the Governor and Lt. Governor recommend spending $1.3 billion to serve Florida developmentally disabled population. That marks a $789.4 million increase since 1998-1999. The $1.3 billion also includes $104.5 million that will be used for support services provided through the home and community based care waiver which will provide rehabilitation and medical/dental services to 2,028 more Floridians with disabilities next year.
  • Veterans: Since 1998-99, funding for veterans has increased by 126 percent. This year, the Governor and Lt. Governor are proposing $53.1 million for veteran services. Since the Governor took office nursing home beds for veterans in our state have more than doubled. The Governor and Lt. Governor also are recommending $700,000 in additional funds to develop the seventh state veterans facility, to be built in northeast Florida.
  • Housing: Governor Bush and Lt. Governor Jennings are recommending $354.4 million in next year's budget to respond to the increased affordable housing needs created by the hurricanes. This is $354.4 million additional dollars to the $192.9 million in recurring affording housing funding included our recommendations.

Economic Development:

  • Economic Growth and Diversification: The Bush/Jennings Administration recommends $117 million for economic development tools and incentives, a six percent increase over the current year. This includes $37.9 million to fund economic development incentives and $24.7 million to support VISIT Florida, a 20 percent increase over current funding. The allocation would also include, $15 million for Enterprise Florida, a 36 percent increase over the current year and $4 million for Rural Infrastructure and Community Development, a 16 percent increase.
    The Governor believes it is important to promote international business relationships in our state; to that end, the Governor recommends $3.7 million to promote Florida internationally. Lastly, the Bush/Jennings budget recommends $5.1 million to foster the reputation and growth of Florida's Film industry.

  • Transportation: Governor Bush and Lt. Governor Jennings consider a well-designed and well-maintained transportation system critical for economic development. The Governor recommends investing $6 billion in Florida's transportation work program, a 5 percent increase over current funding. The budget also includes $2.9 billion to continue development of a strategic intermodal system.
  • Rural Counties: The Bush/Jennings budget recommendation includes $301 million to support Florida's most financially disadvantaged counties. That allocation includes $15 million on a recurring basis to help these counties with their general budget needs. Additionally the budget recommends $46 million for transportation, wastewater treatment and infrastructure grants. The Governor also recommends $40 million to fund small counties eligible for sparsity in the Florida Education Finance Program, which is a $9 million increase over the current year. The Governor and Lt. Governor also recommend $55 million to fully fund education facilities construction for rural counties.

Stronger, Safer Communities:

  • Crime is Down: Under Governor Bush, Florida's index crime rate is the lowest in 33 years. Currently, criminals in Florida serve at least 85 percent of their prison sentences as opposed to the late 1980s when criminals only served about 37 percent of the judge's sentence. As a result, during the last five years, our crime rate has dropped 24 percent. The Governor's budget includes $1.7 billion for the operation of Florida's correctional system, an increase of 54 percent over the last seven years.
  • Prison Funding: The Bush/Jennings Administration recommends $176 million for new prison construction and operations, to ensure state prisoners continue serving 85 percent of their sentences and to help keep crime rates low.

Natural Resources and Environment:

  • Everglades Funding: Florida continues to meet its commitment to fully fund its share of Everglades restoration. The State has invested more than $1 billion to restore the River of Grass, ensuring the restoration continues ahead of schedule and under budget. This year's recommendations include $100 million in General Revenue funding. This funding allows Florida to fully meet its financial obligations for restoration while keeping the state in sound fiscal standing by limiting debt. As a partner in this project, the South Florida Water Management District will use the funds to acquire land, accelerate construction projects and enhance Stormwater Treatment Areas to protect and restore the 2.4 million-acre marsh.
  • The Florida Forever Program: The Governor and Legislature have committed $300 million each fiscal year since the Florida Forever Act became law on July 1, 2001. To limit debt, the Bush/Jennings budget recommends $300 million in cash instead of bonds for this program. Since July 2001 more than 308,000 acres have been acquired under Florida Forever. This is in addition to the 1.7 million acres acquired through the Florida Preservation 2000 initiative. The Florida Forever Act improved upon the Preservation 2000 program by emphasizing better patterns of protection for ecosystems.
  • Energy Initiatives: Governor Bush and Lt. Governor Jennings want Florida to become an incubator for alternative energy sources, which will create jobs and facilitate economic development while protecting Florida's natural resources. The Bush/Jennings budget includes $12.9 million in grants and $2.1 million in tax incentives to attract corporate investment create high-tech jobs and demonstrate "next generation" hydrogen technology.
  • Beach Restoration: After a devastating hurricane season, the Bush/Jennings budget more than doubles funding for Florida's beaches recommending $72.2 million to restore storm-damaged and other shorelines over the next year. The proposal builds upon the $68.4 million appropriation from the 2004 Legislative Special Session, which set aside supplemental emergency funding to rebuild dunes and repair miles of sandy beaches ravaged by the forces of four hurricanes.
  • Water Resource Protection: The Bush/Jennings budget recommends $228.4 million in grants and loans for drinking, storm water and wastewater projects, including $20 million for wastewater projects in the Florida Keys. Strengthening protection for Florida's water, Governor Bush has consistently expanded funding for water improvement projects. During the last five years, Florida has invested close to $1.8 billion to clean up pollution, upgrade drinking water facilities and improve wastewater and storm water treatment, funding more than 800 projects statewide.

Smaller, More Efficient Government:

  • Living Within Our Means: Governor Bush and Lt. Governor Jennings believe government should not grow more than the people's ability to pay for it. Governor Bush and Lt. Governor Jennings call for limiting government growth to 1.6 percent, well below total personal income growth of 5.6 percent. Through this philosophy, Florida's economy will continue to grow, resulting in increased revenues to the state. This philosophy has also helped spur the creation of 750,000 new jobs for Floridians in the last 6 years.
  • Tax Relief: Governor Bush and the Florida Legislature have aggressively rolled back the tax increases of the 1990s. Floridians will have realized more than $10.7 billion in tax relief over six years. The Bush/Jennings budget provides $285 million in new tax relief that includes a sales tax holiday on clothing, books and school supplies, incentives to attract and retain manufacturing, research and development jobs, extending tax credits for low income housing, incentives for hydrogen technology, repeal of the taxes on alcoholic beverages sold by the drink and a two year phase out of the remaining intangibles tax.

For more information on the Governor's budget recommendations, visit his e-budget at www.myflorida.com.