New apartments in downtown West Palm Beach, Florida,
The Florida House and Senate on Thursday each adopted $87 billion proposed fiscal year 2019 budgets that are within $100 million of each other’s bottom lines, but present significant differences in funding priorities.
The House adopted its $87.2 proposed spending plan in an 85-27 vote while the Senate passed its proposed $87.3 billion budget in a 37-1 tally. The two chambers are expected to begin conference sessions to forge a common budget, although the joint meetings have not been formally scheduled as yet.
Among differences to be reconciled is the House’s $8 million allocation and Senate’s $100 million commitment to the state’s Florida Forever conversation land-acquisition program, and the House’s plan to divert $182 million from affordable housing programs that the Senate’s proposed budget dedicates $308 million to.
Florida lawmakers have tapped into the William E. Sadowski Affordable Housing Trust Fund to plug budget gaps for the past 10 years, but this is the first time that the House has proposed a business-as-usual plan while the Senate is determined to fully fund the trust.
The disparity in commitment drew harsh criticism from Democrats during floor readings of the proposed House budget on Wednesday and Thursday.
Rep. Lori Berman, D-Lantana, said the proposed “sweep” of $182 million from the fund is morally unjustifiable.
“I have an issue with calling something a trust and then sweeping funds from it,” she said.
Hurricanes Irma and Maria decimated the Florida Keys, where affordable housing was already scarce. The storms also forced thousands of displaced people from Puerto Rico and the Virgin Islands to seek housing in Florida, further aggravating shortages of inexpensive housing.
“We are in an affordable housing crisis, we all know that,” Rep. Carlos Guillermo Smith, D-Orlando, said. “We know that because we live in Florida; we’ve seen our constituents suffering from it.”
Even before the hurricanes, many middle- and low-income families in Florida were financially stressed by housing costs.
According to the University of Florida’s Shimberg Center, 744,662 low-income renters paid more than 40 percent of their earnings for housing in 2015 — a 35-percent increase from 2005.
The Florida Housing Coalition’s 2017 Home Matters report maintains that 31 percent of all home owners in Florida and 18 percent of all renters spend more than 50 percent of their income on housing.
The Sadowski affordable housing trust fund was created by the legislature in 1992 to leverage private and federal funding for affordable and workforce housing. Its 10-cent surcharge for every $100 paid on real estate transactions was doubled to 20 cents in 1995. This year, the trust funds are projected to generate between $308 and $322 million.
During the early 2000s housing boom, trust fund revenues grew. Legislators began diverting millions from the fund for other purposes. A 2018 Senate Community Affairs Committee analysis determined that since 2001, legislators have diverted more than $2 billion into the state’s general revenue account to plug budget holes and provide tax relief.
Bills submitted this year in the Senate and House propose to do just that. Senate Bill 874, sponsored by Sen. Kathleen Passidomo, R-Naples, and House Bill 191, sponsored by Rep. Sean Shaw, D-Tampa, would ban future legislatures from “sweeping” housing funds to other needs.
“This is a self-inflicted crisis,” Shaw said. “When people are forced to live in cars, crammed 10 to 12 to a hotel room, it’s clear that this state has failed.”
Shaw’s House Bill 191 was pre-filed in September and referred to the House Transportation and Tourism Appropriations Subcommittee in October, where it has languished unheard. Passidomo’s Senate Bill 874 was unanimously approved by the Senate Community Affairs on Jan. 16 and is now in the Senate Transportation, Tourism and Economic Development Appropriations Subcommittee.
Shaw’s bill has not been received enthusiastically by House leadership. Speaker Richard Corcoran, R-Land O’Lakes, told the Miami Herald in January that just because money is earmarked for a specific purpose doesn’t mean it will be allocated to that fund, especially when there are many other priorities to contend with in “a tight budget year.”
Corcoran said education is the chamber’s top priority this year. To that effect, the House on Thursday approved a $25.8 billion education omnibus bill.
Although the House’s proposed budget diverts $182 million from the affordable housing trust fund, it commits $123 million in Sadowski money to housing programs, including $90 million to the State Apartment Incentive loan program.
The Senate’s proposed budget directs about $50 million to the State Apartment Incentive and spells out these other allocations:
• $114 million to the Florida Housing Finance Corporation, including $10 million for housing for persons with development disabilities.
• $40 million for apartment loans for workforce housing.
• $103.8 million for the State Housing Initiatives Partnership program (SHIP) to provide affordable housing to low- to moderate-income families.
• $3.8 million for homeless housing.
Smith said “raiding the fund year after year” will diminish its effectiveness for years. “If $10 billion fell out of the sky today for affordable housing, we would not be able to find affordable housing for those who need it” because it take years to build such housing stock, he said.
“At least the Senate is of good mind and conscious to do the responsible thing and they are not going to sweep the Affordable Housing fund,” Smith said.
“The affordable housing crisis is just that,” Rep. Wengay Newton, D-St. Petersburg, said. “I am hoping the ship will right itself in the conference with the Senate.”