Revenue estimating conference updates Florida transportation revenue outlook; analysts cite hurricanes, fuel-efficiency and methodological changes

The Revenue Estimating Conference on Oct. 12 reviewed updated transportation revenue data through the December 2024 distribution and debated differing forecasts for motor fuel, diesel, off‑highway fuel, aviation fuel and the rental car surcharge that largely feed the State Transportation Trust Fund.

Conference analysts presented data showing modest year‑to‑date gains in most fuel categories but a decline in aviation fuel. Matthew Coachello, Department of Revenue, told the group, "As a reminder, there's a 2 month lag in the data," noting the December 2024 distribution represents November collections and October consumption. Jesse Atkinson of the Economic Development Research office said the conference adopted a new national forecast input for fleet miles per gallon — "the first time in a while that we've seen them actually go through the forecast and make an update throughout the forecast to every year," he said — a methodological change that raises fuel‑efficiency assumptions by roughly 0.7 percentage points across the projection horizon.

Why it matters: The conference’s recommendations shape estimates that feed the State Transportation Trust Fund and other budgetary planning. Small changes in consumption, price or refund assumptions can move the trust fund forecast by millions of dollars over the five‑year window.

Key numbers and drivers - Data used: distributions through December 2024 for fuel (six months of fiscal year 2025) and the February 2025 distribution for the rental car surcharge (eight months). Analysts reminded participants that collections data have a roughly two‑month reporting lag. - Year‑to‑date comparisons: motor fuel gallons were 0.3% above the prior year; diesel gallons were 1.4% above; off‑highway fuel collections about 1.7% above; aviation gallons about 3% below the prior year; rental car surcharge receipts about 1.5% above. - Methodology: Analysts relied on a mix of variables to shape forecasts — Florida pump price per gallon, fleet miles per gallon (the Conference’s national provider updated its fleet MPG path), total visitors, construction expenditures, real personal income and other economic indicators. The change in the national provider’s fleet‑miles‑per‑gallon series produced a uniform upward adjustment of roughly 0.7% across forecast years. - Weather effects: Several analysts said hurricane impacts appear to have depressed gasoline and aviation consumption in late 2024. Tom Parks (Department of Revenue) and other analysts noted October–November collections likely reflected storm impacts; DOT staff attributed increased diesel use in part to post‑storm debris removal after Hurricane Milton.

Analyst differences and preferences Analysts presented alternative forecasts and discussed which series the conference should adopt. Jonathan Kramer (Governor’s Office) presented a motor‑fuel forecast that shows stronger growth in fiscal 2025 that tails off and becomes negative in the far‑out years as population growth and registrations slow; Tom Parks (Department of Revenue) and DOT staff offered slightly different shapes. For diesel and off‑highway fuel, analysts pointed both to stronger year‑to‑date actuals and to construction expenditure assumptions as drivers of higher near‑term estimates.

On aviation fuel, analysts diverged on how much late‑2024 declines should influence the annual forecast. Some models down‑weighted the late‑2024 decline as a storm anomaly; others incorporated more of the observed drop. DOT’s fiscal‑year‑2025 aviation forecast was lower than the prior REC forecast and DOT said it applied the statutory aviation rate (4.27¢ per gallon) and a blended refund methodology when calculating gross collections. For FY2025 DOT reported applying a 60.4% blended refund rate to account for unusually high partial‑year refunds.

Refund rates and rental cars Analysts discussed refund‑rate calculations for highway and aviation fuel and for the rental car surcharge. Approaches differed: some used three‑year blends (FY23–partial FY25), others favored two‑year averages or heavier weights on the most recent partial year. For the rental car surcharge, DOT reported gross collections for the first eight months of FY25 were about 1.5% ($1.7 million) above the prior year same period; analysts generally lowered the FY25 level relative to the prior forecast and modeled a new, lower level with similar long‑run growth.

Requests and follow‑up Participants asked staff to consider adding monthly actuals to future handouts so the conference can see month‑by‑month patterns alongside annual totals. Jesse Atkinson said staff would add that task to a summer assignment list for follow up.

No formal adoption or roll call vote was recorded in the transcript; analysts and members expressed preferences for particular forecasters for specific series during the discussion but the meeting record supplied does not show a final, formal vote on which single set of analyst forecasts was adopted.

Taper: The conference closed after analysts reviewed fallout tables and alternative outputs that show the budgetary effect if each analyst’s forecast were adopted in full. The session focused on reconciling near‑term storm effects, the new national fleet‑efficiency inputs and varying refund‑rate treatments before any formal adoption was recorded in the transcript.