NEWSOM STARTS TENURE WITH $30 BILLION SURPLUS

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By Miriam Raftery

November 19, 2018 (Sacramento) -- When Gavin Newsom is sworn is as CaliforniaGovernor in January, hell be starting out on a strong footing. The state has nearly $30 billion in combined reserved and unexpected tax revenues, the Legislative Analysts office just reported, stating, By historical standards, this surplus is extraordinary.

So even though Newsom also starts his reign with a two-thirds supermajority of Democrats in both the Assembly and Senate, capable of raising taxes without a single Republican vote, its unlikely that they will do soCal Matters reports.

Credit for the extraordinary surplus is due mainly to outgoing Governor Jerry Brown, who started his tenure eight years ago facing a $27 billion budget deficit  so bad that some experts feared the state might not stay solvent.

Brown was blocked by Republicans from efforts to increase taxes to balance the budget. So Brown then got approval from voters through ballot measures to raise income taxes mainly on people earning $1 million a year or more.  Those revenues now account for over $100 billion projected in the coming fiscal year  thats 71 percent of the revenue flowing into the states general fund to finance programs ranging from schools to healthcare. 

While revenues have risen, spending has leveled off for several reasons. Schools have experienced declining enrollment as the states population ages. With property values rising, property tax revenues have doubled in the past eight years. Health care costs, though still rising, are forecast to increase at only half the rate as last year since Browns successful push to enroll poor people in Medi-Cal means the vast majority of eligible recipients are already signed up. 

Brown also wielded his veto power judiciously, sometimes frustrating liberal legislators by vetoing spending bills for various proposals.

Despite the optimistic outlook, budget experts recall the dot.com crash back in 2000, which caused anticipated revenues to plummet, taking the state from a $10 billion surplus to a $12 billion deficit in just one year.  The state also faces formidable costs of fighting wildfires and aiding in disaster recovery.

Some legislators have voiced eagerness to push for popular programs to help more Californians, from an ambitious universal healthcare program to public ownership of utilities.  California has long led the nation on areas such as combatting climate change and environmental protection.

But while sweeping reforms may have broad appeal, Newsom may be wise to use caution, keeping most of that $30 billion surplus built up since the last recessionand saving it for the proverbial rainy day.

Comments

Pure propaganda,

"Projections show California’s pension funds (CALPERS and CALSTRS) will come up at least tens of billions of dollars short in covering future retirement obligations. Tens of billions is a big shortfall. How can California have a budget surplus when our public pension plans are not projected to meet their promised benefit payments to participants?" Democrats running for California governor need to stop talking about Trump and start talking about public pensions

RE: Pure Propaganda

Considering California has the Fifth largest economy in the World only behind only three Countries, US, China, Japan, and Germany, how do you Patriot’s expl the unfunded liabilities in the Chart contained in this link of all the States? And that California is 39th on the list? And this coming from the Heritage Foundation.

 

https://www.heritage.org/budget-and-spending/commentary/how-big-your-sta... 

Pure propoganda,

"Projections show California’s pension funds (CALPERS and CALSTRS) will come up at least tens of billions of dollars short in covering future retirement obligations. Tens of billions is a big shortfall. How can California have a budget surplus when our public pension plans are not projected to meet their promised benefit payments to participants?" Democrats running for California governor need to stop talking about Trump and start talking about public pensions

30 Billion in reserves?

Only the "progressive" crooks running the State of California can come up with a number like this. 

Forbes has the real number.."According to a January 2017 study, “California state and local governments owe $1.3 trillion as of June 30, 2015.” The study was based on “a review of federal, state and local financial disclosures.” In other words, that $1.3 trillion in debt is the amount to which California governments admit. Apr 19, 2018".

https://www.forbes.com/sites/thomasdelbeccaro/2018/04/19/the-top-four-re...