**Distressed Real Estate Consulting Services, Inc. **
The Sunshine State exodus of families with children depicted in the Wall Street Journal(NYS:DJ) article is reflected starkly in Florida’s 2006-2007 public school enrollment figures. Statewide, 48,400 new students were expected in 2006-2007, but only 477 showed up. South Florida public schools saw 15,000 fewer students than expected. This same trend of lowered new enrollees was identified in five of seven South Florida counties. Broward County experienced the biggest difference between expected and actual new enrollments – 6,000 student desks went empty! Palm Beach administrators expected an increase, albeit modest; but instead saw a 3,000 pupil loss. The continued flight of families with children is predicted to continue through the 2010-2011 school year.
United Van Lines, Inc., the country’s largest moving company, reported 16,212 inbound shipments to Florida in 2006 and 17,019 outbound shipments. The number of inbound moves to Florida by United Van Lines grew each year for the period from 1999 to 2004. The current pattern of resident loss began in 2005. What is the cause of this demographic shift? Where are these families headed? The causes can be traced to the forces of nature coupled with economic decisions made in response to these natural occurrences.
The active hurricane seasons of 2004 and 2005 led to massive rate hikes from the state’s largest home and business insurance carriers. With no state income tax, Florida local governments rely heavily on property taxes which have skyrocketed as more and more cash fuel is needed to pay for the infrastructure demands placed upon a state bursting at the seams with nearly 14 million inhabitants. Property values have risen in response to demand and limited supply, especially after the disastrous storms of 2004 and 2005.
So, to where are all these people headed? North Carolina, South Carolina and Oregon have all implemented remarkable public relations programs to lure disgruntled Floridians. To combat this population hemorrhage, Governor Charlie Crist, in cooperation with a willing state legislature, has big plans to slash insurance rates, drastically reduce or even eliminate property taxes on homestead parcels, and apply growth caps on business tax bills. In addition to providing immediate fiscal relief, the plan is also to stem the flow of émigrés. Time will tell.