Economists slightly lowered their forecast of tax dollars flowing into the state but still project lawmakers to be on track to have at least a $1 billion surplus for the next budget.
Members of the Revenue Estimating Conference lowered their outlook — last made in March — due in part to changes in revenues such as corporate-income taxes, real-estate taxes and highway-safety fees.
Chief economist Amy Baker, who directs the Legislature’s Office of Economic & Demographic Research, said Thursday that the economy remains in good shape, calling the drop “uneventful.”
“Growth in revenue, even though it’s a little less than where we started today, is still $1 billion,” Baker said.
The forecast of general revenue plays a critical role for state lawmakers as they designate tax dollars to schools, health programs and prisons in Florida’s annual budget. Lawmakers will meet in the spring to draw up a budget for the 2015-16 fiscal year, which starts July 1, 2015.
The economists look at numerous indicators to estimate revenues over several years. The new report shows that revenues during the recently ended 2013-14 fiscal year were $106.7 million below a March estimate. Revenues for the current fiscal year are projected to be $49.2 million over the earlier estimate. And revenues for the 2015-16 fiscal year were projected to be $84.1 million lower than what was estimated in March.
Sen. Andy Gardiner, an Orlando Republican who is slated to become Senate president after the November election, called the new estimates a positive sign for the state’s economy.
“It was not long ago that with each successive estimating conference we learned how much we had to cut from the budget in order to stay in the black,” Gardiner said in a prepared statement.
Gardiner, who has made protecting the state’s water resources one of the priorities for his term as president, added that the projected revenue growth will help the state invest in “education, transportation infrastructure, and environmental restoration and preservation initiatives.”
House Appropriations Chairman Seth McKeel, R-Lakeland, called the new numbers “very modest fluctuations.”
Helping offset the declines are projected increases in revenue from sales taxes and insurance-premium taxes, Baker said.
In the most recently completed fiscal year, which ended June 30, taxable sales exceeded the previous peak reached in fiscal year 2006-07.
But other revenues have been affected by issues related to real estate and slower growth compared to the 1990s and early 2000s.
Baker said that while homes sales have shown noticeable signs of improvement, the median sales price has lagged, resulting in a slower increase in the state’s documentary stamp tax revenues — fees paid when real estate is sold.
“We’re 92, 94, 95-percent of where we were in 2005, which was the peak year (for home sales),” Baker said. “But doc stamp collection is 40 percent of where we were in 2005.”
The next forecast is expected to be made in December, and those numbers will be used in drawing up the governor’s proposed 2015-16 budget. The conference will meet again in March during the legislative regular session.