Topic: Public Finance
News
May 19, 2017

California’s new-car sales market is cooling down, but Golden State dealers remain on track to again ring up more than 2 million unit sales in 2017, according to the Sacramento-based California New Car Dealers Association.

CNCDA released its first-quarter 2017 report on Tuesday, showing 506,745 new-car sales in the period. That was up less than 1 percent from 503,463 in the opening quarter of 2016.

News
May 19, 2017

But the state will still be worse off after the next market peak. That’s because Brown and the legislature have not addressed core budget issues. As proof, consider these unfortunate facts: If revenues over the next three years follow the same path as 2001–2003, revenues would fall $50 billion short. If revenues over the next four years follow the same path as 2008–11, revenues would fall $60 billion short. The Rainy Day Fund is expected to have a balance of only $8.5 billion by 2018, a drop in those buckets. Even if the Rainy Day Fund were to reach its constitutional maximum, revenues would still fall $40–50 billion short.

News
May 19, 2017

Last April, we highlighted research from Joshua Rauh, a professor at Stanford’s Graduate School of Business, placing America’s state and local pension shortfall at an eye-popping $3.4 trillion. This year, Rauh has crunched the numbers again—and, despite a growing stock market, the situation has not improved. . . The numbers are so grim that it is hard to see how America gets through the next recession and its aftermath without a wave of municipal bankruptcies. Public employee unions have managed to extract promises from state and local governments that are simply impossible to keep. And those governments have been papering over the extent of their obligations with accounting assumptions that are so overly-optimistic as to be deceptive.

News
May 19, 2017

California is spending record sums on anti-poverty programs, $19 billion per year more than in 2012. We have the highest poverty rate in the nation, over 20 percent, according to the Census Bureau, when the cost of living is taken into account. But taxpayer-funded programs can never catch up to the problem, because higher taxes are part of the cause of the problem. Where are the jobs that allow people to climb out of poverty and enjoy a rising standard of living, instead of declining wages and never enough money to buy things?

News
May 19, 2017

Fresno Unified School District used state money meant for low-income minority students to pay for police programs, bathroom renovations and other expenses not related to the students, the California Department of Education reported. . . The American Civil Liberties Union has led the criticism of the district’s spending, arguing that the district misspent more than $36 million in special funds, including $5.6 million on bathroom renovations and additional janitors; $5.6 million for a middle school redesign; $3.8 million for school employees; and $440,000 to hire more school police officers and to expand the use of a bullet-tracking system.

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May 19, 2017 / Natalie Kitroeff

May 19, 2017 / Ben Leubsdorf