Officials predict weak economy
BY SCOTT PAGE Gulf Breeze News Scott@gulfbreezenews.com

Many residents of Northwest Florida are fighting to make ends meet in a slacking, post-hurricane economy. Locally and nationally, the housing market is plummeting, oil prices are surging and the dollar is falling to new lows and it seems the economic outlook for 2008 could be very grim.

Some economists warn that we are headed into a recession, but Santa Rosa County Commissioner John Broxson doesn't agree.

"There is a slowdown in the economy here, however, this is cyclical in nature and does not forebode a drastic outcome for the future," says Broxson. "It appears to some that things are really bad, but the reality is that this slump is not as severe as some of the past downturns."

Even with an optimistic point of view, it is impossible to overlook the existing strains on the local economy. Residents of Santa Rosa County are presented with a number of economic challenges this year. The following is a list of the major challenges/ threats that the general populace could face in the next year.

Real Estate Market - The of 2007 compared to 2006. This is especially alarming because Florida's tax base is heavily reliant on real estate - property taxes, document stamp taxes, intangibles taxes and sales taxes.

Insurance - Residents face increasing insurance rates, and there is a growing number of homes in the Citizen's coverage pool, which is now the largest insurer in the state. If a natural disaster happens in a normal system the premiums from ratepayers nationwide help cover the damage. However, in Florida hurricanes will be the sole responsibility of ratepayers and now taxpayers, through the state provided insurance.

Fewer Government Services - "[Because Amendment 1 passed] there will be noticeable reductions in local government services to the citizens," Broxson said. This is especially true when considering that government revenues have already been lacking.

According to the UWF Haas Center's Northwest Florida Economic Outlook, state and local budgets have been hit very hard by the housing slump.

"Florida is already in a real estate and government recession," quipped Harper during a speech to the Gulf Breeze Rotary Club last month.

Job Market - The status of the job market is also disturbing. Local job creation has slowed and the unemployment rate increased last year. In 2007, Santa Rosa County had one of the lower numbers of jobs added, 493, of all the counties in Northwest Florida. Walton County had the highest number, 3, 779, and Calhoun County had the lowest with 64.

The population of Santa Rosa County continues to grow. From 2006 to 2007, the county saw a population gain of over 25, 000 people. Population gain, coupled with a slower job creation rate caused the unemployment rate in Santa Rosa County to increase by 0.3 percent.

Higher Energy Costs - Harper warns that Energy costs are expected to increase dramatically in 2008 as result of Governor Crist's plan to start taking steps to lower emissions. Harper says that this effort will possibly raise electric prices by as much as 20 to 40 percent.

Hurricanes - The biggest threat to the economy faced in the coming year may not be taxes, the real estate market or energy prices. It could be weather. Another direct hit from a large storm could do substantial damage to our economy.

"The biggest threat to the economy, as I see it, is hurricanes," Eddy said. "If we were to take another direct hit, the longterm impact to the economy would be major and lasting."

Although these challenges and threats to the local economy are daunting, it is not time to panic. There are just as many bright spots and opportunities for economic growth in 2008.

New Business / Job Growth - There is the possibility for improvement of the job market. Although local population growth was previously cited as negative factor in the job market, it can also lead to positive developments. Harper states, in the Economic Outlook, that it is likely that population growth will cause jobs to arise and replace those that are lost.

Tourism - When tourists visit our area, the government collects revenues in the form of bed taxes, which are a percentage of the cost of renting a hotel or condominium. Last year, Santa Rosa County enjoyed the largest increase in bed taxes over the months of April, May and June with an over 59 percent increase.

According to Harper, The Travel Industry Association of America predicted an increase in summer tourism to be up 1.4 percent from last year. Harper adds that Northwest Florida will see increased tourism all year and will enjoy the economic impact. Furthermore, all money tourists spend at local businesses will help offset the drop in sales tax revenues.

Local Government Efforts - Local government is also trying to help residents weather the storm. The City of Gulf Breeze plans to find new revenue to foot the bill for government services.

The county is also putting forth efforts to help locals.

This will leave more money in the pockets of citizens, which will undoubtedly be welcomed. However, it also means that citizens will be more responsible for their financial security because this will result in less government services.