Hard to Spend It All in One Place — Or Is It?
(The Legislative Analyst said April 26 that despite an uncharacteristic month of income tax collections, the state will likely end April with $4.5 billion more in revenues than predicted in the budget GOv. Jerry Brown introduced in January.
“Our best estimate is that the state will end April with (personal income tax) collections for the fiscal year to date … somewhere around $4.5 billion ahead of the administration’s estimates. As day-to-day collection trends have been quite unusual this month, this figure certainly is subject to change and could go down slightly if, for example, refund activity accelerates,” the analyst writes.
While being above projections by $4.5 billion seems like a boon both Brown’s Department of Finance and the analyst caution that the impact of the unexpected cash on the budget might be slight — depending on the revised spending plan the Democratic governor unveils in the middle of next month.
“These additional revenues raise a number of challenging questions for next month’s updated budgetary forecasts,” the analyst writes, “and the corresponding improvement to the state’s financial bottom line may be quite limited. This is because a large portion of the additional revenues may be required to be allocated to schools and community colleges.”
(Editor’s Note: Scroll down from the link above to “Potentially Higher Revenues and Proposition 98 Requirements” for an explanation of why much of the money could go tos chools and community colleges.)
Filed under: Budget and Economy
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