His spending plan allocates $478 million for maintenance on the state’s universities, parks, prisons and hospitals, a tiny fraction of the $66 billion the state needs to spend to catch up with deferred maintenance, according to the state Department of Finance.
California income and corporation tax collections surged in December, pushing estimated tax revenue since July to about $3.6 billion above what lawmakers projected when they approved the current budget, according to preliminary totals compiled by the nonpartisan Legislative Analyst’s Office.
In 2006 California voters approved about $40 billion in bonds to address infrastructure deficiencies. About $5 billion of that hasn’t been spent. Brown’s Department of Finance says about $1 billion will be included in this year’s budget.
With his first bill as a state senator, former Assembly Speaker Bob Hertzberg has proposed a massive shift in California tax policy, one he says better reflects a 21st century economy where information and services make up a huge portion of economic activity. The Los Angeles Democrat proposes extending the state’s sales tax to many services and devoting the money to education and local governments. As a tax hike, the bill requires two-thirds approval – a heavy lift in a Legislature where Democrats have lost their supermajority. But Hertzberg chairs the committee that oversees tax bills and is widely seen as an ambitious politician. Taxes will also figure big this year as political operatives prepare ballot measures for the 2016 election. Education advocates are calling for an extension of the temporary tax increases voters approved with Proposition 30 in 2012, and liberal activists want to change 1978’s Proposition 13 to increase taxes on commercial property. Public health advocates have said they will pursue a new tax on cigarettes this year, through either legislation or the ballot box.
School districts throughout San Diego County are seeing huge electricity bill increases that have soared as much as 40 percent in recent months, according to some officials.
Governor Edmund G. Brown Jr. today took the oath of office as Governor of California and delivered his inaugural address in the Assembly Chamber. The address serves as the Governor’s constitutionally required annual report to the Legislature.
California officials have no plans to make up for an expiring federal pay incentive designed to entice doctors to treat low-income patients..
America’s corporate income tax rate, at 35%, is the highest in the world. A rising chorus would like to bring it more in line with foreign rates, which average around 23%. I have a better idea—abolish the tax. The long-term benefits would greatly outweigh the short-term costs. And revenue from other sources, especially the personal income tax, would quickly make up for it and then some.
A state-mandated schedule for replenishing California’s cash-strapped teachers’ retirement fund means school districts will see their pension contributions triple by 2021 and remain high for decades, according to budget forecasts released this month by several local districts.
Administrators say they’re at a loss for how they’ll come up with the cash, which for some districts could be tens of millions per year. The forecasts come just six months after a legislative deal was struck by Sacramento lawmakers to recover billions of dollars for the California State Teachers’ Retirement System, or CalSTRS.
In June 2014, the Legislature directed the LAO to prepare a report analyzing the costs, benefits, and trade-offs of various options for a state earned income tax credit (EITC) that would supplement the federal credit. This report discusses considerations for adopting a state EITC and provides three options for the Legislature’s consideration.
Hertzberg’s tax increase — introduced as SB 8 immediately after he was sworn in Dec. 1 — actually is long-needed tax reform, the kind that causes most politicians to avert their eyes.
The measure finally would extend the state sales tax to services, the fastest growth sector of California’s economy.
Two major contributors to the decline in total revenues were employee retirement revenue, which includes earnings on investments and contributions, (dropping 67.7 percent, from $533.3 billion to $172.0 billion) and interest earnings (falling 44.6 percent, from $91.9 billion to $50.9 billion).
A new analysis from the California Budget Project (CBP) looks at how California could create its own state EITC and shows that a refundable state credit could provide an economic boost for more than 3 million households. In addition, a state EITC would help rebalance California’s tax system, under which low-income families currently pay an outsize share of their incomes in state and local taxes, and would also strengthen our state’s social safety net.
But while San Jose and other cities will never literally reach a single employee who sits in the room mailing out pension checks, the trajectory is headed in that troubling direction. One city manager even quipped to a newspaper a few years ago that cities are becoming pension providers that offer a few public services on the side.
The much higher voter turnout of a presidential election, coupled with a much lower threshold for qualifying initiative ballot measures, creates the opportunity for pro-tax-increase forces – such as public employee unions – to make their big move.