TALLAHASSEE — Florida's economy is expected to grow slowly, yet steadily, over the next two years, meaning that an end could be coming to recurring years of budget cuts in state government.
State economists on Thursday projected that the state's tax collections should grow by 4.3 percent in the coming year — and then grow an additional 5 percent in the year after that.
The new numbers are on almost on par with projections that economists made back in January, which itself is one sign that the economy has stabilized since the state's tax collections rely heavily on such items as consumer spending and tourism.
"At least the economy is starting to behave like we expect it to behave," said Amy Baker, the head of the state's Office of Economic and Demographic Research.
Baker, however, still cautioned that "the economy still has far to go to return to normal conditions." Baker's office earlier this summer put out a report that highlighted that a drop in the state's jobless rate was because people are dropping out of the work force not because they are finding jobs.
Still the growth could be good news for both Gov. Rick Scott and the Florida Legislature since it would lessen the need for budget cuts in order to balance the state budget.
The slight uptick in state tax collections, however, could give fresh impetus to Scott in his quest to cut and eventually eliminate the state's corporate income tax.
Legislators have been reluctant to embrace Scott's tax cut because it would have required spending cuts in areas such as schools and health care.
Florida's budget relies primarily on a variety of taxes, especially the state's 6 percent sales tax that itself rises and falls based on consumer spending.
The new forecast projects that the state should take in nearly $25 billion in the coming year in its main budget account. That amount is expected to grow to nearly $27 billion in the fiscal year leading up to Scott's re-election campaign. The state's fiscal year runs from July 1 to June 30.
The state's overall budget is nearly $70 billion, but that's because it includes federal aid for such programs such as Medicaid, the safety-net health care program for the poor, and money that is spent on road-building and transportation.
If the projections hold then lawmakers could have as much as a $2.5 billion cushion when they draw up a new state budget in the spring of 2013. But that depends on whether expenses in such programs as Medicaid remain flat.