Only in California: $440.5 Million in Extra Revenue Is $350 Million Short

Here in the Bronze Golden State, the state income numbers for June have just come in. Collections came in better than forecast by $440.5 Million. That seems good, but it’s not quite good enough to meet California’s budget. That budget projected that revenues would exceed the projection by $790.5 Million, so California’s golden revenues in June now look like pyrite.

The problem for California is, there really is no driver for continued revenue growth. The new Amazon Tax will lead to less revenues in future months (it won’t be a huge loss, but it will be a loss) rather than the $200 Million increase that was written into the budget. Unemployment is increasing, and California businesses continue to face regulatory hell. I’m not seeing any improvement in the national economy.

California policymakers are hoping, of course, that I’m wrong. But for business to expand there must be reasons to do so. The administration in Washington is giving no one a reason to expand. Sacramento is following suit. Unless something drastic changes, California is looking at another year of malaise.


Comments are closed.