tough choices remain for florida presentation to the tbrc november 1, 2007 leroy collins institute...
TRANSCRIPT
Tough Choices Remain for Florida
Presentation to the TBRC
November 1, 2007
LeRoy Collins Institute
LeRoy Collins Institute ~ Carol Weissert, Director
FSU Campus ~ 506 W Pensacola Street Tallahassee FL 32306-1601
850-644-1441 ~ 850-644-1442 fax
5010
015
020
0
1980q1 1985q1 1990q1 1995q1 2000q1 2005q1quarter
Alabama FloridaGeorgia North CarolinaSouth Carolina Tennessee
Virginia West Virginia
OFHEO Repeat Sales Index Adjusted for Inflation Using GDP Deflator
House Price Index, 2000Q1=100
01
23
45
Bill
ions
of 2
006
Dol
lars
199219931994199519961997199819992000200120022003200420052006
Florida Documentary Tax Collections
6466
6870
72P
erce
ntag
e o
f Hou
seho
lds
1985 1990 1995 2000 2005year
Homeownership Rate in Florida, 1984 to 2006
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Per
cent
1998 2000 2002 2004 2006year
Florida Real GSP Growth, 1997 to 2006
01
23
45
67
89
10U
nem
ploy
me
nt R
ate
, Flo
rida
1975m1 1980m1 1985m1 1990m1 1995m1 2000m1 2005m1month
Florida Unemployment Rate Jan 1976 to Aug 2007
010
020
030
040
050
060
070
0V
ALU
E
1990m11992m11994m11996m11998m12000m12002m12004m12006m12008m1month
Construction Jobs in Florida, January 1990 to August 2007
-20 0 20 40
SeattlePortland
NashvilleMIA-FTLOrlando
WashingtonRaleigh
LAPhoenixTampa
SFLas VegasOrange CA
St LouisAtlanta
JAXHouston
MinneapolisDetroit
SacramentoChicago
DallasPhiladelphia
San DiegoNew York
DenverBoston
WSJ October 25, 2007 Percentage Change in Past 12 Months
Percentage Change in House-for-Sale Inventory
-10 -5 0 5 10
SeattleCharlottePortland
AtlantaDallas
DenverChicago
MinneapolisBoston
New YorkSFLA
Las VegasMIA-FTL
WashingtonPhoenix
San DiegoTampaDetroit
WSJ October 25, 2007 Percentage Change in Past 12 Months
Percentage Change in House Prices
0 2 4 6
MIA-FTLLas Vegas
OrlandoDetroitTampaAtlantaDallas
HoustonSacramento
JAXNashvilleCharlotte
DenverSan Diego
St LouisBoston
New YorkPhoenix
WashingtonLA
MinneapolisChicago
PhiladelphiaOrange CA
RaleighSF
PortlandSeattle
WSJ October 25, 2007
Percent of Mortgage Payments Overdue
01
23
45
67
89
1011
12P
erce
nt
1985 1990 1995 2000 2005year
Florida Rental Vacancy Rate 1985 to 2006
0 5 10 15Percentage Change 2000H2 to 2007H1
Panama CityFort MyersMiami-FtL
Fort WaltonPensacolaMelbourne
JaxTampa
LakelandNaples
GainesvilleSarasotaOrlando
Tallahassee
BEBR Web Surveys Matching 1,121 Complexes with 3,534 Types of Units
Rent Has Risen Much Less than House Prices
5010
015
020
025
0
1980q1 1985q1 1990q1 1995q1 2000q1 2005q1quarter
Miami Ft LauderdaleWest Palm DaytonaMelbourne St Lucie
Palm Coast JAX
OFHEO Repeat Sales Index Adjusted for Inflation Using GDP Deflator
Atlantic Coast: House Price Index, 2000Q1=100
5010
015
020
025
0
1980q1 1985q1 1990q1 1995q1 2000q1 2005q1quarter
Naples Fort MyersSarasota Tampa
Panama City Pensacola
OFHEO Repeat Sales Index Adjusted for Inflation Using GDP Deflator
Gulf Coast: House Price Indexes, 2000Q1=100
100
150
200
1980q1 1985q1 1990q1 1995q1 2000q1 2005q1quarter
Orlando LakelandOcala Gainesville
Tallahassee
OFHEO Repeat Sales Index Adjusted for Inflation Using GDP Deflator
Interior: House Price Indexes, 2000Q1=100
Percentage Retiring by Age, 50-75
0
2
4
6
8
10
12
14
16
50 52 54 56 58 60 62 64 66 68 70 72 74
Age
0.5
11.
52
2.5
33.
54
Mill
ions
of N
ew R
etire
es
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050year
Esimate of New Retirees per Year, 1950-2050
Estimate of New Retirees per Year, 1950-2050
Social
SSocial Security Trustees Report, 2006, Figure IV B 2
Social Security Retired Beneficiaries per Covered Worker
Mean Family Wealth for Households by Age of Head
0
100
200
300
400
500
600
700
800
900
1989 1992 1995 1998 2001 2005
Ages 35-44 Ages 55-64
Figure 3. Wage Premium over High School Graduates
2
3853
13
77
121
0
20
40
60
80
100
120
140
Some College College Advanced Degree
Perc
enta
ge
1973
2003
AL
AK
AZ
AR
CA
CO
CT
DE
FL
GA
HI
ID
IL
INIA KS
KY
LA
ME
MD
MA
MI
MN
MS
MO
MT
NE
NV
NH
NJ
NM
NY
NC
NDOH
OK
OR
PARI
SC
SDTN
TX
UT
VT
VA
WA
WV
WI
WY
200
002
5000
300
003
5000
400
00
15 20 25 30 35Share College Graduates 2005
Income per Resident 2005 Fitted values
Income and Percent College Graduates
11.
21.
41.
6C
anad
ian
Do
llars
per
U.S
. Dol
lar
1970m1 1980m1 1990m1 2000m1 2010m1month
Since 2002 Dollar Has Plunged vs. Canadian Dollar
.4.5
.6.7
.8.9
Pou
nds
per
Dol
lar
1970m1 1980m1 1990m1 2000m1 2010m1month
Dollar Also Down vs. the Pound
.7.8
.91
1.1
1.2
Eur
os p
er D
olla
r
1998m1 2000m1 2002m1 2004m1 2006m1 2008m1month
The Dollar Has Fallen a Third vs. the Euro
05
1015
20V
ALU
E
1950m1 1960m1 1970m1 1980m1 1990m1 2000m1 2010m1month
Federal Funds Rate
.022
.024
.026
.028
To
tal E
xpe
nd
iture
s / Ju
st V
alu
es
.045
.05
.055
.06
To
tal E
xpe
nd
iture
s / T
ota
l Pers
onal I
nco
me
1985 1990 1995 2000 2005year...
All Local Governments in Florida, except Duval
010
020
030
040
050
060
070
080
090
0100
0110
0120
0G
over
nmen
t Job
s
1990m11992m11994m11996m11998m12000m12002m12004m12006m12008m1month
Government Jobs in Florida, January 1990 to August 2007
02
46
810
1214
1618
shgo
vt
1990m11992m11994m11996m11998m12000m12002m12004m12006m12008m1month
Share Government Jobs in Florida, January 1990 to August 2007
1500
020
000
2500
030
000
1970 1980 1990 2000 2010year
FL Real Income per Resident US Real Income per Resident
Annual Income Growth per Resident 2% for FL and US
.025
.05
.075
.1.1
25
1975 1980 1985 1990 1995 2000 2005Year
(Log Difference CPI)
Annual Inflation: 1976 to 2006
2.5
33.
54
2005 2010 2015 2020 2025 2030Year
TV1.5 TV0
State Total
Ratio of Taxable Value to Personal Income: 2006 to 2030
2.5
33
.54
2005 2010 2015 2020 2025 2030year
Tier Tier, no SOHPortability Base
Taxable Value as a Proportion of Personal Income, Florida, 2006-20
Business Taxes as Share of GSP
5.45.1
4.3
0
1
2
3
4
5
6
FL US SE
Estimated by Ernst and Young
Business Share of S&L Taxes
47.844.9
38.9
0
5
10
15
20
25
30
35
40
45
50
FL US SE
Estimated by Ernst and Young
The New Florida Legislation
• In January 2007, the Florida legislature passed the “Insurance Industry Accountability and Consumer Protection Act”
• This act expands the scope of Citizens Property Insurance Corporation (Citizens) and the Florida Hurricane Catastrophe Fund (FHCF)
• The goal of this act is to lower residential property insurance rates in Florida
Storm Damage ~ 7th Power of Wind Speed
• Force ~ Velocity Squared
• Area
• Duration
• Catastrophic Failure of Structures
Nordhaus NBER Working Paper 2006 (He says 8th power.)
Low-lying Areas at Risk of Sea-level Rise and Storm Surges
Estimated 2008 Savings in Premium Plus Assessment
-500
0
500
1000
1500
2000
Monroe Dade Hillsborough Orange Duval Leon
County
Ch
ang
e in
Pre
miu
m P
lus
Ass
essm
ent
Household (Homeow ners + Tw o Auto Policies)
Homeow ners PolicyAuto Policy
Local Share of FEFP Up 8 Points
0
5
10
15
20
25
30
35
40
45
50
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Challenges for K-12 Schools• Class Size Amendment• Backloading of Teacher Pay• Automatic Raises for Advanced Degrees• Higher Pay in Georgia• Higher Pay in Alternative Occupations• Limited Merit Pay• Limited Extra Pay for Math, Science, Special Ed• Unions• Low-SES Students• Large Schools, Large Districts
0 10,000 20,000 30,000 40,000 50,000
MS
AL
WV
LA
AK
KY
FL
TN
SC
VA
NC
GA
Source: National Education Association
Average Teacher Pay 2004-2005
Florida Rest of Southeast
0 5 10 15 20
FL
KY
MS
TN
AL
NC
LA
GA
SC
WV
AK
VA
Source: National Education Association
Students per Teacher 2004-2005
Florida Rest of Southeast
0 10 20 30 40 50
VA
FL
GA
SC
TN
LA
AK
AL
MS
KY
WV
NC
Source: National Education Association
Share of K-12 Funding Local 2004-2005
Florida Rest of Southeast
05
1015
2025
2000 2005 2010 2015Year
FTE Projected FTESchool Age Population Projected School Age Population
Population Projected Population
(Millions)
Population and FTE
Annual Educational and General Funds of the University System of Florida FY 1989-2006 in Billions of Dollars
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
FY1989
FY1990
FY1991
FY1992
FY1993
FY1994
FY1995
FY1996
FY1997
FY1998
FY1999
FY2000
FY2001
FY2002
FY2003
FY2004
FY2005
FY2006
SOURCE: Florida Department of Education Fact Book 2003, Table 40
FTE and Headcount Enrollment: Florida Universities FY 1989-2006
050,000
100,000150,000200,000250,000300,000350,000
1988
-89
1990
-91
1992
-93
1994
-95
1996
-97
1998
-99
2000
-01
2002
-03
2004
-05
FTE
Hdcount
Source: Florida Department of Education Division of Colleges and Universities
Undergraduate Tuition and FeesFY 2006
• Florida $2,648• Texas $4,400• North Carolina $3,551• Georgia $3,377• United States $5,027
Source: National Center for Educational Statistics 2006
Tuition, Constant 2007$, FL & US
0
1000
2000
3000
4000
5000
6000
7000
2005 2006 2007
FL
US
030
0060
0090
00
1985 1990 1995 2000 2005year
UF GaTechUK UNCUSC UVA
In-State Tuition Constant 2007$, 1985-2007
Higher education status:
• Funding remains below average
• Tuition remains extremely low– Bright Futures and Florida Prepaid
• Absence of political will for excellence
• First separation of Bright Futures from tuition
Medicaid Enrollment Growth Fiscal Years 1985-2011
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
FY 198
4
FY 198
6
FY 198
8
FY 199
0
FY 199
2
FY 199
4
FY 199
6
FY 199
8
FY 200
0
FY 200
2
FY 200
4
FY 200
6
FY 200
8
FY 201
0
SOURCE: Social Services Estimating Conference July 17 07, Sept. 26, 03.
Annual Medicaid Expenditure Growth Rate, FY 1985-2008
-5%
0%
5%
10%
15%
20%
25%
30%
35%
FY 85
FY86FY87
FY88FY89
FY90FY91
FY92FY93
FY94FY95
FY96FY97
FY98FY99
FY00FY01
FY02FY03
FY04FY05
FY06FY07
FY 08
SOURCE: A Snapshot of Florida Medicaid. Oct. 4 2006 Updated by Social Services Estimating Conference—
Medicaid Services Expenditures Services Expenditures July 30 2007
Medicaid Status
• Recent drops in Medicaid spending are temporary
• Slowing economy increases demands on program
Florida KidCare Title XXI Enrollment 2002-2007
050,000
100,000150,000200,000250,000300,000350,000400,000
2002
July
2002
Nov
2003
Marc
h
2003
July
2003
Nov
2004
Marc
h
2004
July
2004
Nov
2005
Marc
h
2005
July
2005
Nov
2006
Marc
h
2006
July
2006
Nov
2007
Marc
h
2007
July
Florida KidCare Title XXI Enrollment 2002-2007
050,000
100,000150,000200,000250,000300,000350,000400,000
2002
July
2002
Nov
2003
Marc
h
2003
July
2003
Nov
2004
Marc
h
2004
July
2004
Nov
2005
Marc
h
2005
July
2005
Nov
2006
Marc
h
2006
July
2006
Nov
2007
Marc
h
2007
July
Florida KidCare
• Enrollment has stabilized but program is undersubscribed
• State loses federal dollars when enrollment drops
Bottom Line
• Two years later little change in overall diagnosis
• Florida’s future is compromised by low service levels and a narrow and inequitable tax base
• Demographic trends show richer, older state
• K-16 Education endangered• Long-term thinking is key