TALLAHASSEE, Florida — Sparked by lower gas prices and a gradually improving economy, Florida's budget surplus for next year could be nearly $1 billion, according to new estimates drawn up Monday by state economists.
The good economic news could aid Gov. Rick Scott's campaign promises to cut taxes while at the same time spending more on schools and the environment.
Scott made his pledges during the height of his push for a second term, but at the time he made them state economists projected a relatively modest surplus of more than $300 million for 2015 and there were questions about whether the governor's promises were feasible.
Scott made it clear on Monday that he wants the Republican-controlled Florida Legislature to use the larger surplus to help him keep his promise to voters.
"Because we are creating an environment where our private-sector can succeed, our economy is growing, which makes it possible for us to invest in areas important to Florida families," Scott said in a statement. " I look forward to working with the Legislature to continue to cut taxes by $1 billion over the next two years and increase K-12 per pupil funding to the highest level in our state's history this coming year."
The state's economy was already projected to continue gradually recovering from the depths of the Great Recession.
But economists revised their estimates to show the state's main budget account should grow nearly 5 percent during the fiscal year that started in July and ends next June. Economists also predict an additional 4 percent growth in the 2015-16 fiscal year. The extra growth could add an additional $622 million to the bottom line.
The main source of money for state government is the state's 6 percent sales tax, but other taxes, such as those on real estate transactions, are also counted in the total. Florida's overall budget is roughly $77 billion, although that includes a mix of both state tax dollars and federal aid for programs such as Medicaid.
Amy Baker, coordinator of the Office of Economic and Demographic Research, said one key reason for the revised estimates was that lower gas prices appear to be spurring consumers to spend in other areas. Baker said forecasts anticipate that the lower gas prices will remain in effect until next year.
"If you give them more money in their pocket, they are likely to spend it," Baker said.
The new forecasts will be used by Scott as he prepares his budget recommendations for the Legislature. State legislators will then use Scott's proposals as they craft a final budget during the 2015 session that starts in March.
Legislative leaders expressed a "cautious optimism" about the increased surplus but stopped short of promising to go along with Scott's priorities.
"There is no shortage of ideas for how this slight increase in available general revenue could be spent," said Senate President Andy Gardiner in a statement, adding, "Our challenge is to remain vigilant and responsibly plan for Florida's future."
House Speaker Steve Crisafulli, R-Merritt Island, said, "It is important we don't forget the principles that brought us here. We will continue our commitment to fiscal responsibility with every dollar as we prioritize funding initiatives and seek ways to continue tax relief for Florida's families."
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