Capital outlay forecasts take dive; outlook grim for higher education
Oct 3, 2011
The following article was published in the Florida Current on October 3, 2011:
Capital outlay forecasts take dive; outlook grim for education
By Travis Pillow
Public schools, colleges and universities likely face a tough time expanding campuses and even just maintaining existing buildings, based on new state projections released Monday.
State forecasters revised downward by more than two-thirds their revenue projections for a program that helps pay for building maintenance and construction projects at public schools, colleges, and universities.
The updated projections for the Public Education Capital Outlay (PECO) lowered forecasts of funds available for the 2012-13 fiscal year from $380.8 million to $113.2 million.
The falling funding levels cascade into future years, dropping from previous estimates by $409.7 million in 2013-14 year and by $206.6 million the year after that.
Legislative economist Amy Baker said Monday that the declines were because of lower revenue projections for the Gross Receipts Tax, a levy on electrical and telecommunications services which goes to PECO, and an accompanying decline in bonding capacity. If the new projections hold, the state will not be able to issue new PECO bonds in either the current or the upcoming fiscal year.
Baker said the revenue face downward pressure in the short term because of a soft economy, and long-term growth could be stymied by efforts to curb energy consumption.
This past month, the state Board of Governors requested $22 million to maintain and renovate buildings on state universities, the product of a process Chancellor Frank Brogan likened to “triage,” as officials sought to prioritize needed repairs. In the current fiscal year, universities received only $13 million for renovations and maintence, as PECO funding fell below its lowest levels after the recession of 2008.
The decline in funding likely will affect universities and colleges more harshly, since local schools can tap property taxes to help pay their way. In recent years, an increasingly large share of PECO funding has gone to higher education. In the 1990s K-12 received about 60 percent of the PECO funding. Now higher education receives about 70 percent. This past year, only charter schools received PECO money; public K-12 schools received none.
Sen. Evelyn Lynn, R-Ormond Beach, who chairs the Budget Subcommittee on Higher Education Appropriations, said she would like to find more money to help cover capital costs but there appear to be “no easy answers.”
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