This November, Florida voters will be asked whether the state should expand the amount of money it can set aside in its Budget Stabilization Fund—commonly referred to as its “rainy day” fund. Amendment 1 would change the state Constitution to allow the fund to grow to a larger percentage of annual general revenue and would establish the process for adding money to or withdrawing it from the fund each year.
The measure, which does not propose any new tax, is intended to better prepare Florida for future financial downturns or emergencies. Though advocates of the amendment say a larger reserve would increase preparedness and response during economic emergencies, critics argue the additional funds would be better spent addressing pressing, current state needs.
The Budget Stabilization Fund, which is administered by the state’s Chief Financial Officer (CFO), was created in 1992 by constitutional amendment. Its primary purpose is to protect the statewide budget during unexpected economic emergencies, such as a recession or natural disaster. If state tax revenues fall, leaving the state with a budget shortfall, money from the rainy day fund can be transferred into the General Revenue Fund to help keep government services and operations running.
Under current law, the Budget Stabilization Fund must be maintained at an amount not less than 5% and not greater than 10% of the prior fiscal year’s General Revenue Fund net revenue collections. Under the provisions of Amendment 1, the maximum amount that could be held in the fund would increase to 25%. The measure would also require the Legislature to transfer up to $750 million to meet this cap into the rainy day fund by the fiscal year’s close on June 30.
If approved by voters, Amendment 1 would substantially increase the amount Florida can save in its rainy day fund, while also creating a new constitutional pathway for lawmakers to access part of that larger reserve for a critical state need.
The proposed amendment would maintain existing rules that permit the savings to be used for revenue shortfalls and emergencies, but it would add another option. Once the fund grows above 15% of state General Revenue collections, lawmakers could use some of the money for a nonrecurring critical state need, but only with a two-thirds vote in both chambers (the House and Senate) and only once every five years. The withdrawal could also not reduce the fund below 10% of General Revenue collections.
According to an analysis and fiscal impact statement prepared by the Florida Senate Committee on Appropriations, 10% of the state’s last completed fiscal year’s net General Revenue Fund collections was approximately $4.9 billion, while 25% would have been approximately $12.2 billion.
If revenue collections remained the same, the committee estimated, “the joint resolution would require the Legislature to transfer $750 million each fiscal year for at least the next 10 years” to build the fund toward the increased cap.
In practical terms, Amendment 1 would require the state to set aside $750 million each year until the rainy day fund reaches the proposed 25% of revenue limit, restricting those moneys from being appropriated toward other priorities. The amount set aside each year could be less if less is needed to meet the 25% cap.
The proposal passed the Legislature, heading to voters’ ballots, with clear favorability. The House vote was 100-1, and the Senate vote was 29-4.
But critics of the measure say the question isn’t about whether Florida should save for emergencies; rather, it's whether voters should permanently put such a large reserve requirement into the state Constitution.
While supporters see the larger reserve as insurance against a potential recession or unexpected economic or financial crisis, critics question whether setting aside hundreds of millions of dollars each year is the best use of state revenues at a time when the state is facing needs in areas such as education and health care.
A “yes” vote on Amendment 1 would raise the Budget Stabilization Fund’s cap from 10% to 25% of annual general revenue collections and require the Legislature to transfer up to $750 million into the rainy-day fund by the end of each fiscal year, with limited exceptions. A “no” vote would keep the current 10% cap and leave the existing laws governing the fund in place.
The amendment must receive at least 60% of votes cast to pass. If approved, Amendment 1 provisions would take effect on Jan. 5, 2027.
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