Legislature Will Have $395.6 Million Less to Spend on the New State Budget Than Previously Anticipated
Florida legislators received news this week that they will have $395.6 million less to spend on the next state budget than originally anticipated. Citing weaker corporate profits and adverse developments in the international economy, the state General Revenue (GR) Estimating Conference decreased its estimates of GR collections in each of the six years in its forecast horizon. The estimates were decreased for the current year (FY2015-16) by $139.3 million (0.5 percent), and by $249.2 million (0.8 percent) for the upcoming budget year (FY2016-17). This amounts to $388.5 million less in revenue collections over the two years. Coupled with some additional minor adjustments, the reduction in available revenue climbs to $395.6 million. Total collections for the current year are now forecast at $28.275 billion, which represents growth of only 2.1 percent ($593.7 million) over the current year.
This marks only the second time since October 2011 that the conference has produced reduced GR estimates. Looking further out, the estimates for the next four years were also decreased significantly, with an average reduction of $279 million in each year between FY2017-18 and FY2020-21. Total GR collections are now expected to approach $35 billion by FY2020-21.
These estimates are important because the Legislature can only appropriate the amount officially forecast to be collected in the fiscal year. GR is the money for which legislators have the most discretion, as it can be spent on most anything in the state budget. GR is a major source of revenue for education, human services, and public safety and corrections. When there is a discussion of a state budget shortfall or surplus, it is generally GR that is being considered.