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California could end April $3.5 billion ahead of expectations

5:25 PM, Apr 22, 2013   |    comments
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California's tax revenues began 2013 stronger than expected and will end the all-important month of April some $3.5 billion ahead of Gov. Jerry Brown's assumptions.

That's according to a new snapshot from the independent Legislative Analyst's Office, a reflection of this month's impressive tax collections.

"Last week, we had two days of over $2 billion a day in collections," says deputy analyst Jason Sisney.  "Those were among the largest revenue days in California history."

Even with several years of tinkering by lawmakers with the timing of tax revenues, April remains the most important month for the state budget's bottom line.

On Monday, analysts say the state netted $535 million in personal income tax revenues, bringing April's total to almost $10.9 billion.

Sisney says while it's true that the governor's winter budget assumed that April would bring in almost $13.3 billion and thus the month seems to be running slightly behind expectations, the January windfall was so large -- a net result of almost $4 billion in unexpected cash -- as to make "subsequent monthly estimates kind of meaningless."

The only number that matters, he says, is the year-to-date estimate, which remains strong.

Even so, it remains unclear just why revenues are beating expectations -- from wealthy taxpayers writing checks early to beat 2013 federal tax increases, the Proposition 30 state increases, a slowly improving economy... or some combination of these.

"We really won't know until a year, or a year and a half from now," says Sisney on deciphering exactly what's behind the extra cash.

While the vast majority of the money will likely be earmarked for K-12 schools and community colleges (under provisions of the state constitutional guarantee, Proposition 98), it's possible some of it will be available for other uses.

As far as the governor's concerned, it's not going to restore spending for social services or other programs.

"I believe we're right on the edge right now," Brown said in an interview at the conclusion of his China trade mission.

Earlier in the trip, the governor told reporters traveling with him that his administration is collecting data to prove that California remains more generous than most other states when it comes to assistance for low income families.

"In California, how much does the taxpayer have to contribute to other people who are less fortunate?" Brown mused while riding a high speed train in China.  "I'd say we are at a very, at a generous scale," he said, "compared to what some other states are doing, and compared to what the taxpayers probably want."

NOTE: Since we did this story, the revenue numbers have grown even higher... to at least $4.5 billion, perhaps more.  Final numbers won't be known until Gov. Jerry Brown releases his revised state budget in mid-May.

News10/KXTV

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