Florida economists delivered some sobering news Wednesday to state lawmakers: Money is tight.
Citing rising costs — especially in Medicaid spending where pharmaceutical costs have been climbing — economists forecast a $1.3 billion budget shortfall by 2018, when Gov. Rick Scott will be entering his final year as Florida’s chief executive.
Next year, the state should have just enough money to meet what economists consider Florida’s basic, critical and high priority needs. But after that, rising Medicaid and K-12 school costs, combined with the cumulative loss of state dollars from years of tax cuts, will be felt.
Scott’s successor as governor — whoever it is who takes office in 2019 — could be greeted by a looming $1.8 billion shortfall if nothing is done soon, according to the three-year financial outlook presented this week to the Legislative Budget Commission.
What it all means is, lawmakers will probably begin making selective budget cuts next year — to stave-off the deeper hole forecast.
If so, Scott’s drive for another round of robust tax-cutting could be shelved.
Incoming Senate President Joe Negron, R-Stuart, also will likely have a tougher time selling fellow lawmakers on his plan to pump another $1 billion into higher education and buy land south of Lake Okeechobee to ease flood-preventing releases that are polluting nearby waterways.
Signs of the money crunch became public last month, when state economists shrunk revenue predictions by $267 million for this year and next.
The state’s current $82 billion budget looks on course to close out next June 30 with a significant surplus. But rising costs will eat that up — fast, economists found.