Tougher Choices Facing Florida’s Future Dr. Carol Weissert Director, LeRoy Collins Institute Professor of Political Science Florida State University May.

Tougher ChoicesFacing Florida’s Future

Dr. Carol WeissertDirector, LeRoy Collins Institute

Professor of Political ScienceFlorida State University

May 20, 2014

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Looking Behind and Ahead

• 1987 Zwick reportWhat Kind of Future do we want for

Florida?“fundamental changes are needed in the ways we finance government in Florida…”

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• “We can no longer compete successfully by relying merely on cheap land, cheap labor, low taxes and plenty of sunshine.”– Sound physical infrastructure– Educated and motivated work force– Quality universities and research and

development institutions– Reasonable tax rates and prudent spending policy

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• “Florida is a state with boundless economic potential…

• Also a state with jammed highways, polluted natural resources, struggling schools, poorly paid teachers, teeming jails, neglected children, needy senior citizens, inadequate health care, a shortage of affordable housing and a declining quality of life.”

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• “Florida is a state on a collision course with painful realities that must be faced—now.”

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Tough Choices 2005• As noted in the Zwick report (1987), in the 1980s Florida

faced challenges and also opportunities• Promise of the 1980s slipping away by the 2000s

– Growing share of low-skill jobs – Lagging investment in education, Class Size Reduction

Amendment (CSRA), accountability sans funding– Infrastructure: low on major urban roads, effective public

transportation– Little willingness to raise taxes to alter these things

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Here’s What We Found This Time

• Growing share of low-skill jobs• Lagging investment in education• Roads not keeping apace with growth• Little willingness to raise tax to alter these

things

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In addition,

• Florida’s reliance on retirees and tourists comes at a price

• Education comparisons of younger generation in Florida are problematic

• Florida’s workforce is “hollowing out” • State lags nation and South in K-12 education;

higher education• Congestion grows and roads aren’t keeping up

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• And then there’s Medicaid….

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Tough Choices: Shaping Florida’s Future

• Bureau of Business and Economic Research– Jim Dewey and Dave Denslow

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First, setting the stage

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Data from the U.S. Bureau of Economic Analysis

Income peaks in 2005; Population Growth Continues

1930

1934

1938

1942

1946

1950

1954

1958

1962

1966

1970

1974

1978

1982

1986

1990

1994

1998

2002

2006

2010

75

80

85

90

95

100

105

1

2

3

4

5

6

7

Income per capita Population SharePe

r Cap

ita In

com

e (U

S =

100)

Popu

latio

n Sh

are

(% o

f US)

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Data from the U.S. Bureau of Economic Analysis

Relative productivity down in the 1990s and 2000s

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

87

88

89

90

91

92

93

94

95

Relative output per worker (US = 100)

Output Trend 1991-2000

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Florida is Old, Getting Older

• 18% Floridians 65+ (14% nation)• By 2020 20% 65+• By 2030 24% 65+

– 62% of Florida’s children will be black or Hispanic– 29% of Florida’s senior will be black or Hispanic

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Implications of Retirees

• Demand different set of services – Housing patterns– Labor Market– Politics

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Manag

ers

Profes

sionals

Tech

nician

sSa

les

Office &

Admin

Producti

on, Craft

, and Rep

air

Operato

rs, Fa

bricato

rs, La

borers

Protec

tive Se

rvice

s

Food Prep

& Clea

ning

Personal

Care &

Servi

ces

0%

10%

20%

30%

40%

50%

60%

Figure 2.7: Florida Employment GROWTH,(2000-2010)

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Going into the Knowledge Economy…Florida’s young workers are less educated!

25-34 35-44 45-64 65 plus

Florida Men 0.216 0.253 0.279 0.299

US Men 0.271 0.292 0.293 0.274

Florida Women 0.295 0.299 0.257 0.175

US Women 0.35 0.333 0.279 0.168

2%

7%

12%

17%

22%

27%

32%

College Graduates in Florida and the US in 2010by Age and Gender

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Education Spending

1988

-198

9

1989

-199

0

1990

-199

1

1991

-199

2

1992

-199

3

1993

-199

4

1994

-199

5

1995

-199

6

1996

-199

7

1997

-199

8

1998

-199

9

1999

-200

0

2000

-200

1

2001

-200

2

2002

-200

3

2003

-200

4

2004

-200

5

2005

-200

6

2006

-200

7

2007

-200

8

2008

-200

9

2009

-201

0

6,000

7,000

8,000

9,000

10,000

11,000

12,000

Current Expenditure per Student ($2012)

Florida South US

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21

22

Lagging Higher Ed Human Capital Investment

State appropriation recovered some in FY 2013, 2014

Per FTEState

Appropriationsper FTE

Net TuitionRevenueper FTE

Appropriationsplus Net Tuition

per FTE

2006-2007

2011-2012

2006-2007

2011-2012

2006-2007

2011-2012

US 7,667 5,905 4,395 5,189 12,026 11,094

Florida 8,147 4,832 2,301 2,905 10,448 7,737

FL/US 106% 82% 53% 56% 87% 70%

FL Rank 15 37 46 47 43 50

FL Percentile 58 22 16 13 8 0

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1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

100

110

120

130

140

150

160

170

Indices of Lane Miles and VMT, Florida and the US(1994 = 100)

LM-FL LM-US VMT-FL VMT-US

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2008

-200

9

2009

-201

0

2010

-201

1

2011

-201

2

2012

-201

3

2013

-201

4$14

$16

$18

$20

$22

$24

Medicaid and Education Spending by Fiscal Year (Billions)

Medicaid Education

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• Medicaid spending per enrollee less in Reform population than non-reform population.

• Reform counties had lower Per Member Per Month costs than non-reform counties.

Medicaid Reform?

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Here’s What We Found

• Growing share of low-skill jobs• Lagging investment in education• Infrastructure needs growing• Some troubling demographic trends• Reliance on tourists and retirees

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Record $100 Million in Funding for Florida Tourism

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Legislative Update

$77.1 billion—largest in state history$500 million—tax cutsIncreased education funding by 2.6% --$575 million—but $400 from higher property taxesHigher ed--$200 million performance based fundingMedicaid--

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Economy

• Economy is slowly recovering• Unemployment rate lower than nation• Jobs numbers are up

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National Climate Assessment

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• “No longer can Florida be a state that is cheap and proud of it. This seems unfortunate, if not silly, in a competitive, global economy that feeds on high-skilled jobs. Tougher choices remain ahead.”

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What is the Solution?

• Floridians need to have open minds to guide some tough choices. They have the right to expect their elected officials—like the Floridians of earlier years—to lead the way. Failing to do so is simply choosing to accept a future far less bright than it could be.

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What is the Solution?

• Floridians need to have open minds to guide some tough choices. They have the right to expect their elected officials—like the Floridians of earlier years—to lead the way. Failing to do so is simply choosing to accept a future far less bright than it could be.

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More information?

http://www.Collinsinstitute. fsu.edu

[email protected]