XPost: alt.california, alt.fan.rush-limbaugh, talk.politics.guns
XPost: sac.politics, alt.politics.economics

https://finance.yahoo.com/news/californias-budget-deficit-likely-grown- 042307741.html

SACRAMENTO, Calif. (AP) — California Gov. Gavin Newsom will update his
budget proposal on Friday, and the news likely won't be good.

Newsom, in his last term as governor and widely seen as a future
presidential candidate, announced a nearly $38 billion deficit in January, driven by declining revenues. Days later, the nonpartisan Legislative
Analyst's Office said the deficit was actually $58 billion when including
some reductions in public education spending.

State officials needed a big rebound in tax collections to improve things,
but it hasn't happened. Through the end of April, state tax collections
from its three biggest sources — personal income, corporations and sales — dropped more than $6 billion below the previous estimate.

That means the deficit has likely gotten larger, and Newsom will have to propose more ways to fix it. This is the second year in a row California
has had a deficit, and so far the state has avoided the most painful cuts
to major ongoing programs and services. Instead, Newsom and lawmakers have slashed one-time spending, delayed other spending and borrowed from other accounts.

A bigger deficit could force tougher choices. In January, Newsom floated
the possibility of delaying a minimum wage increase for health care
workers that Newsom signed into law to much fanfare just last year.

“We still have a shortfall. We will manage it and we’ll manage it, yes,
without general tax increases,” Newsom said on Wednesday during an event
held by the California Chamber of Commerce. “We’re not just going to try
to solve for this year. I want to solve for next year. I think it’s too important. We have got to be more disciplined.”

State budgeting is a guessing game, particularly in California, where a progressive tax system means the state gets the bulk of its tax
collections from rich people. About half of the state's income tax
collections came from just 1% of the population in 2021. This makes the
state more vulnerable to swings in the stock market.

If lawmakers and Newsom get revenue projections wrong and the state takes
in less than they thought, there's a shortfall. And unlike the federal government, the California Constitution requires the state to have a
balanced budget.

Last year, their predictions were way off after a series of destructive
storms in January 2023 prompted lengthy delays in tax filing deadlines.
Instead of filing their taxes in April, most Californians could wait until November. Lawmakers still had to pass a budget by June, despite not
knowing how much money they had.

This January, Newsom said the state’s revenues for 2022-23 to 2024-25 have
been coming in $42.9 billion lower than they estimated.

Newsom and lawmakers have already agreed to about $17 billion in
reductions and deferrals to reduce the deficit. Plus, Newsom has said he
wants to take $13 billion from the state's various savings accounts to
help balance the budget.

But these won't close the gap, and California appears headed toward more deficits in the future.

Corporate tax collections are down 15% from last year, the fourth largest
drop in the past 40 years, according to the LAO. And while income taxes
are growing thanks to a 20% increase in the stock market since October
that's driving an increase of 8% in total income tax collections this
year, the LAO said growth is unlikely to continue. That's because the
broader state economy has not improved — the unemployment rate has risen
and investments in California businesses have declined.

After Newsom reveals his proposal on Friday, state lawmakers will have
until June 15 to pass a balanced budget. The new fiscal year begins July
1.


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We live in a time where intelligent people are being silenced so that
stupid people won't be offended.

Durham Report: The FBI has an integrity problem. It has none.

No collusion - Special Counsel Robert Swan Mueller III, March 2019.
Officially made Nancy Pelosi a two-time impeachment loser.

Thank you for cleaning up the disaster of the 2008-2017 Obama / Biden
fiasco, President Trump.

Under Barack Obama's leadership, the United States of America became the
The World According To Garp. Obama sold out heterosexuals for Hollywood
queer liberal democrat donors.

President Trump boosted the economy, reduced illegal invasions, appointed dozens of judges and three SCOTUS justices.

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