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Thursday, May 8, 2014

Wait a Minute

The cash report for the California state general fund has been released by the state controller.  It covers the period through April - a big tax receipt month.  Compared to last year at this time, receipts (mainly taxes) are up a measly 0.5%, less than inflation.  [$80.1 billion for the first 10 months of the fiscal year compared to $79.7 billion last year.]  That's not something to break out the champagne bottles about. You will see headlines about more revenue than expected relative to what the governor forecast in January.  But Brown likes to make conservative forecasts in an effort to a) appear frugal and b) discourage legislative spending.  However, spending in the first 10 months is up a lot compared to last year.  Now there can be accidents of timing, particularly regarding when the state disburses funds to local governments.  The state's reserve at the moment is minus $10 billion, just where it was last year at this time.  So a lot of revenue relative to spending is going to be needed in the last 2 months of the fiscal year to get the reserve into positive territory.  Meanwhile, UC is hoping to get more from the legislature than the governor has so far proposed (in January).  We should be seeing the governor's May Revise budget shortly.

You can find the cash statement through April at http://sco.ca.gov/Files-ARD/CASH/fy1314_may.pdf

So we don't know yet that we are going to get nothing more than the governor proposed for UC back in January.  But if the Dept. of Finance is looking at the new figures through April, Brown may not feel especially generous.
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