https://www.dailymail.co.uk/news/article-11442029/Go-woke-broke-California-warns-state-budget-plunge-25-billion-red-2023.html

" After two years of budget surplus, the state of California will likely face a $25 billion budget deficit next year driven primarily by high inflation and a weakened economy.
The 2023-2024 fiscal year deficit projection comes despite a projection in May that forecast a surplus of just under $100 billion for the current fiscal year. "

" The predicted shortfall comes from the nonpartisan Legislative Analyst's Office. Their report indicates that California may be heading for its weakest yearly performance since the Great Recession.
The deficit is primarily being driven by a significant decline in income tax revenue and stock market drop-offs, though the analysts noted that the ongoing layoffs in the tech sector are also contributing to the deficit. "

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You would think they would have put a big chunk of that $100 billion surplus into the Rainy Day Fund.

Their tax base is just too thin. It only takes from the wealthy who, during economic difficulties, don't use their money in ways it can be easily taxed.

C@LAg said:

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let me guess, that does not include underfunded pensions, either.

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You're correct:
https://www.latimes.com/business/story/2022-09-29/are-calpers-calstrs-other-pension-plans-headed-for-crisis

FWIW, CAs rainy day Fund is at $34.6 billion. Unfunded pension liabilities are shrinking annually due to mandatory operating spending (8% contribution and 8% match in 2008 is now 10% and 20%) and are on target to be fully funded in 2046, which is slightly ahead of the original goal. This is not an endorsement of California's reckless spending, just a post about the unsexy nuances of CA budget policy that are sometimes missed.

Doesn't California have some sort of weird "boom bust" tax policy? Last year they had a multi billion dollar surplus

that will get wiped by the Dems next green new deal. no worries

Admiral Adama said:

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FWIW, CAs rainy day Fund is at $34.6 billion. Unfunded pension liabilities are shrinking annually due to mandatory operating spending (8% contribution and 8% match in 2008 is now 10% and 20%) and are on target to be fully funded in 2046, which is slightly ahead of the original goal. This is not an endorsement of California's reckless spending, just a post about the unsexy nuances of CA budget policy that are sometimes missed.

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Does that translate to reduced benefits in the intermediate time frame?

Benefits aren't reduced, but retirees didn't have to pay nearly as much as current workers when they were working to get the same pension. And imagine if the US raised the social security employer contribution from 6.2% to 20% to save social security. That has devastating consequences to operating budgets at any business, and that's exactly what's happening at local California school districts and municipal governments for pension funds. So, while the benefits for retirees might not be reduced, the actual services that local government provides are certainly reduced because they're paying for pensions instead of operations.

K2-HMFIC said:

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Doesn't California have some sort of weird "boom bust" tax policy? Last year they had a multi billion dollar surplus

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Mostly from fed COVID money I believe

The solution is simple, tax the sh@t out of Hollywood. They seem to have all this money to fund the campaigns like Beto "El Raton" o'rourke, among others. They might as well keep it in-state to fund their homeless camps and healthcare for illegal migrants.

If only the Feds would print more money, then there would be enough.

Those are rookie numbers. Gavin is going to have to pump those up if he wants to replace Biden in the White House.

Wait....am I reading that right?

Only six months ago, they predicted a 100 billion dollar SURPLUS....but ended up with a 25 billion DEFICIT?

So they were off by 125 Billion?? How is that even possible; especially in only 6 months?

Lord help us if Newsome makes it to Washington

Good. **** them. This will give DeSantis great talking points to kick Newsom down a few pegs in 2024

California is one of the major reason Democrats want their policies nation wide. They don't want people moving to other states. They want you to have to leave the country to avoid their disasters of policy.

dallasiteinsa02 said:

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California is one of the major reason Democrats want their policies nation wide. They don't want people moving to other states. They want you to have to leave the country to avoid their disasters of policy.

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It is already planned for me if this **** keeps up. I will not live in the US upon retirement if things don't change soon. Difference between me and liberals saying it is I already have things in motion for it.

I'm not abandoning the US. The US has abandoned me.

No more COVID money shell game to pretend that liberalism somehow comes without massive deficits

The boom-bust cycle was driven primarily from the unintended fallout of Prop 13 property tax overhaul in the 70s. Thus is only important as other states (Texas) look to overhaul our property tax code. Essentially tailly CA screwed by in 2 ways that had a snowball effect on overall tax receipts.

First they allowed homes to be out into trust. As homes didn't change ownership they weren't reevaluated to current market values.

Second, they allow parent child transfer of property which has the same effect.

Now if a home is improved. Expanded etc...a portion of that cost can be factored into a revaluation.

For single family owner occupied homes. If they were to eliminate those provisions a huge number of homes would be revalued and taxed appropriately. Unlike TX. Sale values are reported to the assessors office.

This resulted in taxes increasing on incomes and businesses...the boom bust cycle. Plus unchecked spending which is a whole other topic.

AlaskanAg99 said:

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The boom-bust cycle was driven primarily from the unintended fallout of Prop 13 property tax overhaul in the 70s. Thus is only important as other states (Texas) look to overhaul our property tax code. Essentially tailly CA screwed by in 2 ways that had a snowball effect on overall tax receipts.

First they allowed homes to be out into trust. As homes didn't change ownership they weren't reevaluated to current market values.

Second, they allow parent child transfer of property which has the same effect.

Now if a home is improved. Expanded etc...a portion of that cost can be factored into a revaluation.

For single family owner occupied homes. If they were to eliminate those provisions a huge number of homes would be revalued and taxed appropriately. Unlike TX. Sale values are reported to the assessors office.

This resulted in taxes increasing on incomes and businesses...the boom bust cycle. Plus unchecked spending which is a whole other topic.

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IIRC, the freeze on RE taxes was driven by exorbitant California spending and generous public pensions in the 1970s/early 80s. Basically, they were taxing people out of their homes. There must be a generational curse of kleptomania by government in that state.

But they will have a really nice rail transport between some major cities, right?

It's a good thing they passed out $5 billion of "inflation relief" checks this year.

They asked for it. Re-elected Hair Gel boy

If you actually believe for a minute there was an actual tangible surplus - cash in the bank surplus - well, I feel sorry for you.

How much of that lost money is in their ridiculous railroad that is years and billions over budget?

All that previous surplus and no investment in energy.

Moronic state.

Tony Franklins Other Shoe said:

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But they will have a really nice rail transport between some major cities, right?

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You mean between nowhere and somewhere.