SEBRING - Florida's chief economist is projecting a $1.2 billion or bigger surplus, but don't expect that windfall here.
Highlands County is still vetting next year's figures, said Senior Budget Manager Tim Mechling. Two major factors loom: "One, I haven't heard from the property appraiser yet, and current-year expenditures are still going on."
However, at this point, Mechling expects a $9 million to $10 million deficit.
The county's current $122.7 million in revenues rest on a three-legged stool: 41 percent stand on property and sales taxes, 26 percent is drawn from the rainy day savings of pre-recession years, and 15 percent from federal, state and other governments. The remaining 18 percent is from other county funds, fines, charges for services and miscellaneous revenues.
State sales taxes are growing modestly as consumer spending recovers, said Amy Baker, the Florida Legislature's chief economist. At the same time, revenue forecasters shaved off some money from expected rebounds in real estate-related taxes as interest rates inch up and federal programs taper for homeowners with "underwater" mortgages.
At Lake Placid, Finance Manager Rachel Osborne predicts a small surplus, "If the town doesn't acquire Placid Lakes Utilities."
If the town does buy the small utility in this fiscal year?
"We're not sure," Osborne said, "it's still too early to know."
City Manager Julian Deleon said Avon Park has low overhead and no debt.
"Today, we still have $4 million set aside in our rainy-day fund. I doubt that we'll be back in debt ever," Deleon told the council on Dec. 9.
In the current fiscal year, revenues and expenses are within forecasted levels, and utility fund revenues have increased because new customers have connected and two previously private utility systems have been acquired. However, it's still too early determine whether that will increase the city's income, Deleon said.
"We do not have revenue projections yet," but he is forecasting a revenue increase from 1,000 housing units annexed into the city during the current fiscal year.
"We are planning on reducing the fire assessment tax by 23 percent for both residential and commercial accounts," Deleon said.
"On the utility fund, revenues will also increase," Deleon predicted. "We are experiencing rapid growth. Everyone wants Florida's best drinking water."
"We just completed a $2.1 million water main expansion in the distribution network," Deleon said. "Our field employees have been swamped with new customer installs. We have installed close to 100 meters in the past 12 months. Revenues also continue to increase from the acquisition of other privately owned systems."
Asst. City Manager Bob Hoffman said Sebring's budget process doesn't start until May
"So we're way early in the process," Hoffman said. He expects to see a slight trickle from state revenues. "But that's a minor part of our budget."
The city's revenues are based mainly on property taxes, but he doesn't expect those to rise until next year.
Last year, the city dipped into the rainy day fund for $300,000, but that's a fraction of the fund balance, Hoffman said. This year's budget will be similar, he suggested.
For the county, the next step comes when department heads and the five constitutional officers submit their budgets, Mechling said.
He's heard - but still doesn't know - whether insurance will go up. The county carries general liability policies and health packages for its workers.
"The board will have to decide whether to pay or lower the benefits," Mechling said. In recent years, commissioners have voted to cut a few benefits and shift rising costs to employees.
"The board hasn't changed its contributions," Mechling said.
To cut the budget over the past five years, commissioners have whittled expenses in every department, asked constitutional officers to trim expenses, and chipped away at the rainy day fund.
Also, Mechling said the county will avoid expenses in this fiscal year, and in recent years the constitutional officers have collectively returned around $1 million in unspent funds.
"We're all in the same boat," Mechling said. However, budgets have been increasingly tighter each year, so less is returned from departments and the sheriff, tax collector, property appraiser, clerk of court and elections supervisor.
At a meeting last week, state forecasters boosted their projections by $150 million over the next 16 months, with $26 million of that increase coming before July 1. Under the latest estimates, the state is expected to take in $1.4 billion in the next budget year more than in the current year.
The state's surplus, Mechling said, "usually doesn't translate here because we have an older population on fixed incomes."
Also, Highlands County doesn't see as many tourists as the coastal counties, and its workforce is among the lowest paid in the state.
Some of the state surplus is already earmarked. Gov. Rick Scott and legislative leaders have pledged to reduce taxes by $500 million during the election-year session.
"It's going to allow us to continue to look for ways to reduce the tax burden on the citizens of the state, invest in things like education and hopefully have a very productive session," said House Speaker Will Weatherford, R-Wesley Chapel, who left little doubt where he saw much of the extra money headed. "Obviously, a lot of it's going to be spent on tax cuts."
At the same time, lawmakers said a modest surplus would not radically alter what they do.
"It's a little bit more, but I don't know that if that substantially changes the game," said House Appropriations Chairman Seth McKeel, R-Lakeland.
One possible tax cut?
The Senate has unanimously agreed to roll back its controversial 2009 hike on motor vehicles, while HB 7123 has passed the lower chamber.
The proposals would potentially save Floridians between $20 and $25 per vehicle registration. The total depends on the size of the vehicle.
The 2014 cut would erase only some of the 2009 increases.
House Democrats have claimed the vehicle registration fee is being reduced to aid the Republican Scott's re-election campaign, noting that Charlie Crist signed the tax increase.
Lower rates should go into effect by Sept. 1, but Highlands County Tax Collector Eric Zwayer has suggested owners hold off buying two-year tags until they're sure.
News Service of Florida contributed to this report