Florida Price Level Index 2010
The Florida Price Level Index (FPLI), established by the Legislature as the basis for the District Cost Differential (DCD) in the Florida Education Finance Program, is used to represent the costs of hiring equally qualified personnel across school districts.
This brief includes a county FPLI comparison table of past years and a review of the FPLI methodology.
2010 Florida Price Level Index
James F. Dewey, David A. Denslow, Eve Irwin, Susan Floyd, Phoebe Wilson
Overview: The Florida Price Level Index (FPLI) was established by the Legislature as the basis for the District Cost Differential (DCD) in the Florida Education Finance Program. In this role, the FPLI is used to represent the costs of hiring equally qualified personnel across school districts. Since 1995, and at the request of the Legislature, the Bureau of Economic and Business Research (BEBR) at the University of Florida has performed an ongoing review of the methodology of the FPLI and has made appropriate recommendations to improve it. Since 2000, BEBR has also been responsible for calculating the FPLI. To denote its intended use as an adjustment factor for school personnel costs, the index presented in this report is referred to as the FPLI for School Personnel, or FPLI_SP. Note that this is a cross-sectional measure that compares the relative wage levels among Florida’s 67 counties and is not designed to measure inflation from one year to the next.
Results: The table on this page presents the index for 2010, which is constructed so that the population-weighted average is 100. The median Floridian, ranked by county FPLI_SP, lives in Brevard County, with an index value of 101.02. That is, less than half of the state’s residents live in counties with index values that are greater than 101.02, less than half in counties with index values that are less than 101.02, and the rest live in Brevard County. The 9 counties with index values over 101.02 together account for 48 percent of the state’s population and the 57 counties with index values below 101.02 together account for 49 percent of the state’s population. Index values tend to be highest in the southern portion of the state, while 42 of the 57 counties with index values below the median are north of Hillsborough County. When population in and around urban areas reaches the high levels seen in south Florida, workers encounter high house prices, long commutes, or both, for which they must be compensated in the form of higher wages. Of course, factors other than housing prices affect wages in a market economy, so relative wages do not track relative housing prices exactly.
Summary: This report presented the 2010 FPLI_SP and the methodology used in its calculation. The index uses extensive data on wages, occupational location, and the prices of goods and services to estimate the relative wage level needed to maintain a given standard of living for occupations comparable to school personnel across Florida’s counties. Although many things affect counties’ FPLI_SP position, counties that are urban tend to have higher values.
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