Major Expenditure Components

More than half of all spending in Florida’s 2012/13 budget went toward education and Medicaid. Medicaid’s share of the state budget has grown by 20 percent since 1990, while education’s share has fallen by 8 percent.

Table 8 shows the major expenditure components of Florida’s state budget as a percentage of total state government expenditures. Well over half of the 2012/13 budget is composed of education and Medicaid expenditures. The major message in table 8 is that education spending has fallen over time and Medicaid expenditures have taken an increasingly larger share of the state’s budget.

In 1989/90, education expenditures (the first two columns of table 8 combined) were slightly more than 34 percent of Florida’s expenditures, but by 2012/13 they had fallen to 25.9 percent. Education spending at all levels in 1012/13 was about equal as a percentage of total expenditures to K–12 spending in 1989/90. The downward trend in education spending as a share of total expenditures was especially pronounced in the early 1990s when K–12 spending fell from more than 25 percent of total spending to 17.2 percent by 1995/96. Since the mid-1990s, K–12 spending has fluctuated around 18–21 percent of total spending.

The trend in higher education spending is not as dramatic. After a slight decline in the mid-1990s, higher education spending was a percentage point higher as a share of total spending in 1999/00 than it was in 1989/90. However, it too has declined since then: after peaking at 11.4 percent of total expenditures in 2002/03, it fell to 7.1 percent of total expenditures by 2012/13.

Over the same years Medicaid expenditures have soared, as shown in table 8. In 1989/90 Medicaid consumed 9.4 percent of total expenditures; it has more than tripled to 30.6 percent of total expenditures in 2012/13. With Medicaid expenditures approaching a third of the state’s budget, it is apparent why Florida (along with other states) is looking for ways to rein in the program’s costs. One place that Medicaid’s increasing expenditures may have crowded out other spending is in the category of public assistance, which has plummeted from more than 2 percent of the state’s expenditures in the mid-1990s to 0.3 percent in 2012/13.

Figure 6 shows the overall decline in education spending as a share of total spending in comparison with the substantial increase in Medicaid expenditures. The figure shows the dramatic shift in Florida’s spending priorities, although this shift was less a conscious decision of Florida’s politicians and more the result of the gradual increase in enrollment in a means-tested program coupled with an increase in health care costs more generally. With education and Medicaid being the two largest components of the budget, figure 6 makes it clear that while there has not been a downward trend in education’s share of the budget since the mid-1990s, Medicaid has more than tripled its share of expenditures since 1989/90, crowding out other parts of the budget.

Corrections expenditures have seen an increase in their share of the budget over the past two decades, a reflection of the “get tough on crime” attitude that the Florida legislature has pursued over that time period.[1] In 1998 Florida’s 10-20-Life Law (Florida Statute 776.087) went into effect, which mandates that convicted felons be sentenced to the maximum allowable sentence when a gun is used in commission of a felony. Using a firearm during the commission of specified felonies requires a 10-year minimum sentence, firing a firearm during the commission of the felony requires a 20-year minimum sentence, and shooting someone carries a minimum 25-year sentence regardless of whether the victim is killed or only injured. The 10-20-Life Law also brought with it minimum mandatory sentences for other crimes. Florida law also specifies that prisoners who committed their crimes after October 1, 1995, must serve a minimum of 85 percent of their sentences. Two decades of “tough on crime” policies in Florida have increased its prison population to more than 100,000, and the increased share of corrections expenditures in Florida’s budget reflects the state’s legislated policies.

Transportation expenditures have fluctuated relatively little over the past few decades, taking up 11.3 percent of state expenditures in 1989/90 and 11 percent in 2012/13. Some modest declines are apparent during recession years, but Florida finances its transportation expenditures from motor fuel taxes, which tend to be relatively constant over the business cycle, and federal grants, which account for the relative stability in transportation expenditures.

[1] See Aaron Deslatte, “Florida Leads Nation in Longer Prison Sentences, Study Finds,” Orlando Sentinel, June 6, 2012, which references legislation dating back to the early 1990s.