Budget Watch–General Revenue Estimates Reduced Slightly
Loss of Indian Gaming Revenue Puts a Dent in General Revenue; State to Refund $542 Million in Excess Corporate Income Taxes
The General Revenue (GR) Estimating Conference met on August 14 to develop a new revenue forecast for Florida. It was a challenging and complex conference for the state’s economists. The uncertainty surrounding corporate income tax collections, the loss of Indian gaming revenue, a weaker economic forecast, and the impact of Hurricane Michael were some of the factors they were dealing with.
The estimates of General Revenue for FY2019-20 and FY2020-21 were reduced from the last official GR Conference (March 2019) by $867.7 million; however, actual GR collections for the fiscal year that ended on June 30 (FY2018-19) came in $507.2 million over the last estimate and these are collections that were not anticipated. Most of that added money ($385 million, 76 percent) is from corporate income tax (CIT) collections which, along with another $158 million in already collected CITs, will be refunded to taxpayers this Spring (see below). These refunds are a major reason the estimates were reduced and represent money the state did not expect to receive.
So, when FY2018-19 is included, the total revenue loss in the three years that can be used to fund the next budget is $360.5 million.
The other big contributor to the revenue decline is the loss of all Indian Gaming Revenue. Due to the failure of the state to enter into a new compact with the Seminole Tribe, the Tribe ceased revenue sharing with the state after making its April 2019 payment. This reduces GR in FY2019-20 and FY2020-21 by a total of $683.8 million. Florida will continue to lose approximately $350 million annually without a new compact.