Jump in May revenue collections argues against Brown’s austerity budget
For the first time since the onset of the recession, the monthly revenue report from the state Controller’s office, released Monday, showed collections outpaced budget estimates for all of the state’s major indicators.
Total revenues exceeded projections made just a few weeks ago by more than 12 percent, or nearly $800 million, led by income tax collections, which came in almost $600 million, or 20 percent, higher than estimates the Brown administration made as part of its revised May budget.
While the report is clearly an important milestone in the resurgence of the California economy, the state’s top fiscal officer also warned that May accounts for only 7 percent of the California’s annual revenue. This month, June, which brings in closer to 12 percent of the total, will provide a much clearer picture of the where the economy is heading.
“California continues to show strong signs of recovery. May’s higher revenues reflect growing employment, increased consumer spending, and a resurgent housing market,” said Controller John Chiang in a statement. “However, this good news should be tempered by nagging questions regarding its sustainability and by the need to repay years of accumulated debt.”
The numbers would have tended to support legislative leaders in their argument that next year’s budget should include a higher amount of spending than what had been proposed by Gov. Jerry Brown.
But that argument appears to have been won by the governor, after announcement of an agreement on the budget
Budget compromise calls for LCFF next year, raises base grant for all schools
Gov. Jerry Brown and legislative leaders reached agreement on a budget plan Monday that will usher in sweeping changes to school funding that give local officials far more control over spending decisions.