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CFO: State's fiscal outlook not so rosy

Alex Sink says she sees the housing market slump and glut lasting through 2008.

By CARRIE WEIMAR, Times Staff Writer
Published November 22, 2007

Alex Sink, Florida's chief financial officer, gives the keynote speech at Focus on 2008 presented by the Largo/Mid-Pinellas Chamber of Commerce at the Largo Library on Nov. 15.
	[Jim Damaske | Times]

Even the sunniest optimist would admit the economic times in Florida are turbulent.

Insurance rates are up.

Property taxes are in flux.

The housing market is collapsing.

On Nov. 15, the Largo/Mid-Pinellas Chamber of Commerce tried to offer a clearer picture of the state's economy with its annual peek into the financial future. The event, called Focus 2008: A Tampa Bay Economic Forecast, featured state CFO Alex Sink as the keynote speaker.

Other panelists included Steve Raney, president of Raymond James Bank; Mike Marks, Hospital Corporation of America vice president; and John Masiello, director of Alternate Energy Strategies for Progress Energy.

Sink offered her assessment of the state's financial status for the crowd at the Largo Library. Here's what to expect for the coming year:

The housing slump will continue at least through 2008 and maybe into 2009.

Sink said the Florida housing market is still overbuilt and it will take a while to get the glut of houses off the market.

"We just need to get prepared for a longer housing slump than what we're used to," she said.

Population rates are declining.

About 1,000 people used to move to Florida every day. Now that number has dropped to 800.

Three of the nation's largest van lines moved more customers out of the state than into it last year.

This news isn't entirely bad, Sink said. However, population growth currently serves as Florida's economic engine.

Some serious adjustments lie ahead if the downward trend continues.

Insurance rates are stabilized.

That's the good news. The bad news is, insurance rates will never again be cheap in Florida, Sink said.

Now, the state is spending billions to offset the potential effect of a catastrophic storm. The key, Sink said, will be persuading investors to assume some of that burden.

"Let's share the risk with Arab sheiks and mega-rich people and hedge funds," she said. "And we can do it."

[Last modified November 21, 2007, 21:13:19]