June 26, 2020

As Florida Revenue Estimates Plunge and COVID-19 Numbers Rise, Florida Leaders Continue to Neglect Solutions to Budgetary Shortfalls

This post was last updated on December 8, 2021. As new policies are announced, FPI will update this page.

As Florida’s response to COVID-19 takes front and center, concern grows for low-income families who struggle to take precautions against the spread of the virus. Although Congress has passed the Families First Coronavirus Response Act to address, at least in part,  the public health crisis and economic fallout from COVID-19, many barriers continue to keep struggling families from accessing the assistance they need during the pandemic. As Florida initiates policies implementing the Act and addressing other barriers to the safety net, FPI will update this form. When available, hyperlinks are provided to agency documents or statements that provide greater detail  about the new policy.

On March 22, 2020, FPI and 44 other organizations sent a letter to Governor DeSantis, leadership in the Legislature and agency heads to urge action on 47 specific policy changes to reduce unnecessary barriers for Florida’s safety net programs in response to the COVID-19 pandemic. See the letter here.

Despite rising COVID-19 cases and skyrocketing unemployment numbers, state leaders have ignored solutions that would help stabilize Florida’s budget and make up for a significant revenue shortfall. We have been saying for years that Florida’s upside-down tax system and our state’s heavy reliance on sales tax puts us at risk during times of economic downturn. This has come to fruition, as new data show that the state’s general revenue has taken a severe hit in May. Florida Policy Institute’s own analysis predicted severe losses in revenue will continue as long as unemployment remains at unprecedented levels and the pandemic continues to harm the health and economic security of Florida families.

Florida received $8.3 billion from the federal CARES Act’s Coronavirus Relief Fund, with $2.5 billion going directly to local governments. However, guidance issued by the U.S. Department of Treasury states that those funds may not be used to make up for revenue shortfalls. States need revised guidance in order to buoy state budgets and boost families and communities facing hardship. The governor should be more vocal and press the Trump Administration and Congress to allow for more flexibility for these funds.

Further, Governor DeSantis must lobby Congress for more federal COVID-19 aid and a Federal Medical Assistance Percentage increase and extension, and all state leaders must work together to preserve crucial public services, like mental health care and education. Lawmakers need to identify and implement revenue-raising solutions, like enforcing the sales tax on online sales, eliminating tax exemptions for luxury items, holding corporations accountable for their tax liability, and eliminating revenue-losing business subsidy programs.

The COVID-19 pandemic and economic recession are far from over. Today’s dreary revenue report was entirely predictable, and confirms that the state is headed rapidly toward a fiscal cliff unless Florida’s leaders take proactive measures.

Earlier this month we spearheaded a joint letter, along with  35 organizations, offering the solutions listed above. Looking to outsized vetoes instead of exhausting every other possible option first is reckless and will only hurt families and communities who are already struggling during this health and economic crisis.

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