Four years ago North Carolina’s unemployment rate was above 10% and the state still bore the effects of its battering in the recession. Many rural towns faced jobless rates of more than 20%. But in 2013 a combination of the biggest tax-rate reductions in the state’s history and a gutsy but controversial unemployment-insurance reform supercharged the state’s economy and has even helped finance budget surpluses.
The so-called split-roll proposal to change Proposition 13 would require the regular reassessment of commercial properties while keeping tax protections for residences in place. Fifty percent of likely California voters said they favor the split roll, while 44% said they opposed the idea, the poll found. In January 2012, 60% of voters supported such a change.
California is paying interest on the loan, an estimated $174.5 million this year, according to a new report from the state Employment Development Department, and the balance is shrinking only because in lieu of direct payments, the Department of Labor has raised taxes on employers.
Elon Musk says his companies don’t need the estimated $4.9 billion they enjoy in government support, but the money will help them move faster to transform the dirty business of energy.
These are hard times for the blue-state governing model of high taxes and public unions—see Illinois, Connecticut and Maryland. But our friends on the left ignore these states and tout California as their real model, as Sacramento celebrates record tax revenue. So it’s worth noting that the Golden State may be repeating the fiscal mistakes it made before its last economic bust.
The proposal is a response to the “maturing” of a CalPERS system that soon will have more retirees than active workers. From two active workers for each retiree in 2002, the ratio fell to 1.45 to one by 2012 and is expected to be 0.8 to 0.6 to one in the next decades.
More than likely, therefore, the EITC will evolve into an “entitlement” that will expand to ever-more recipients. That’s been the history of such benefits, even those deemed to be temporary or non-entitlements when first implemented.
Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.
Marin officials echoed the approach of state officials, who quietly passed that landmark 1999 legislation without a full public airing. In his 2010 testimony before the state Senate regarding a proposed pension-reform measure, Crane said CalPERS claimed at the time that “no increase over current employer contributions is needed for these benefit improvements.” Yet CalPERS recently boosted costs to local and state agencies by around 50 percent — and few legislators were concerned enough about the impact to seriously revisit pension reform — or look at ways to more thoroughly account for the level of debt today.
Despite the bull market, the state’s other big pension fund, the California Public Employee Retirement System (CalPERS), recently imposed a 50% increase in pension costs on local and state governments, and there will be more. The diversion of government revenues to pension costs explains in part why, despite record revenues higher than before the Great Recession, state spending on social services, courts, parks, universities and other programs is lower.
The variations in revenue projections are getting wider, not only between those of the agencies, but from one cycle to the next. And they make state budgeting less an exercise in priority-setting and more a crapshoot whose outcome is determined by esoteric factors completely out of politicians’ control.
The fatter budgets outlined by Assembly and Senate leaders seize on alternative estimates from legislative analysts that the state will receive $3.2 billion more revenue than the Brown administration projects.
As the condition of the pavement worsens and the price to repair it grows, ideas that seemed outlandish a few years ago are back on the table, including a plan by a San Jose lawmaker that would raise vehicle license and registration fees as well as the gas tax.
Unions and grass-roots organizers are considering an effort to, over Brown’s objections, extend the higher taxes that the governor persuaded voters to go along with in 2012. They are also pondering a proposal to alter the state’s landmark restrictions on property taxes, to raise more revenue from commercial interests.
As the condition of the pavement worsens and the price to repair it grows, ideas that seemed outlandish a few years ago are back on the table, including a plan by a San Jose lawmaker that would raise vehicle license and registration fees as well as the gas tax.