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227 Publications Found
February 21, 2007 - For 2007, like most other economists at this time, we forecast that growth will continue but be modest for the nation and California. For the year as whole, 2007 growth will be somewhat less than it was in 2006, with the first half of the year the weakest. Throughout the year, however, growth should accelerate, as the housing sector stabilizes, especially in the second half of 2007. We expect that the state’s performance will generally be similar to the nation’s.
February 21, 2007 - Following two years of major increases, it appears that revenue growth is slowing sharply in 2006-07, reflecting the impacts of a more moderate economic expansion and a dip in income from capital gains. The budget assumes that revenue growth will revive somewhat in 2007-08, led by an improving economy beginning later this year. For the current and budget years combined, we are estimating that General Fund revenues will fall below the budget forecast by $2 billion.
February 21, 2007 - We discuss several of the most significant spending proposals in the budget. For more information on these spending proposals, and our findings and recommendations concerning them, please see our analysis of the appropriate department or program in the Analysis of the 2007-08 Budget Bill, available February 22st, 2007.
February 21, 2007 - The Governor’s budget proposes total spending in 2007-08 of $130.8 billion, including $103.1 billion from the state’s General Fund and $27.7 billion from its special funds. This total budget-year spending is $4.2 billion higher than current-year spending—an increase of 3.3 percent. Of total budget-year spending, General Fund spending accounts for about 80 percent. This proposed spending level translates into $3,430 for every man, woman, and child in California, or $358 million per day.
February 22, 2006 - State costs for reimbursing counties for two state-mandated programs to provide mental health services for school children have grown significantly in recent years. Moreover, serious weaknesses are evident in the system for delivering these services for children in special education programs. To help guide legislative policy-making in this area, we provide background information on these two mandates, assess the Governor’s budget and policy proposals relating to them, and outline the Legislature’s options for addressing these issues.
February 22, 2006 - The Governor has proposed to consolidate several energy-related activities in a new Department of Energy, to be headed by a cabinet-level Secretary of Energy. The Governor’s proposal would also transfer the responsibility for permitting new electricity transmission projects from the California Public Utilities Commission to the new department. In his analysis, we describe the existing energy organizational structure in the state, consider concerns raised about the existing structure, examine key points of the Governor’s proposal, and raise issues and make recommendations for reorganizing energy-related activities in California.
February 22, 2006 - The Governor’s budget contains proposals for increased spending of $61 million ($54 million General Fund) in the budget year related to the state’s emergency preparedness and response—primarily for public health and agricultural emergencies. While some of the proposals are warranted, most of the proposals suffer from one or more deficiencies—such as the failure to maximize funds other than the General Fund, poorly designed solutions, and the failure to follow state information technology policy. Consequently, we recommend the Legislature reject many of the administration’s proposals. We also offer a number of key considerations for the Legislature as it evaluates the state’s emergency preparedness. Finally, we comment on recent federal funding changes, reducing risks through land use decisions, and the creation of separate homeland security and public health departments.
February 22, 2006 - California has benefited greatly from an over $11 billion three-year revenue increase since the 2005‑06 budget was enacted; yet, the Governor’s budget plan would still leave the state with major structural budget shortfalls and a large amount of other financial obligations outstanding. In this regard, we believe the proposal misses a real opportunity to finally get the state’s fiscal house in order by meaningfully addressing what is still a formidable fiscal problem.
February 22, 2006 - Despite a slowdown in the final quarter of the year, the U.S. and California economies generally outperformed expectations in 2005, shrugging off soaring energy costs, rising interest rates, and the impacts of three major hurricanes on Gulf Coast states. Recent monthly data on spending, employment, and production suggest that the softness that occurred in late 2005 will be short-lived, and the economy will expand at a moderate pace in 2006 and 2007. This outlook is subject to significant downside risks, however, associated with the potential for further increases in energy prices and steeper-than-expected declines in the real estate market.
February 22, 2006 - The state budget continues to benefit from healthy revenue growth. After climbing by over 8 percent in 2004‑05, the 2006‑07 Governor’s Budget assumes that revenues from the state’s major taxes will increase further by 6.2 percent in 2005‑06 and 5.7 percent in 2006‑07. The administration’s current forecast is up substantially from the estimates included in the 2005‑06 Budget Act. It is also up significantly from our office’s prior forecast presented in November 2005. In addition, for the current year and budget year combined, our revised General Fund estimates are higher than the administration’s by roughly $2.3 billion.
February 22, 2006 - We discuss several of the most significant spending proposals in the budget. For more information on these spending proposals, and our findings and recommendations concerning them, please see our analysis of the appropriate department or program in the Analysis of the 2006-07 Budget Bill, available February 23rd, 2006.
February 22, 2006 - The Governor’s budget proposes total spending in 2006‑07 of $122.9 billion, including $97.9 billion from the state’s General Fund and $25 billion from its special funds. This total budget-year spending is $7.2 billion higher than current-year spending—an increase of 6.3 percent. Of total budget-year spending, General Fund spending accounts for about 80 percent. This proposed spending level translates into $3,268 for every man, woman, and child in California.
February 22, 2005 - The budget proposes total state expenditures of $109 billion in 2005-06. This includes $85.7 billion from the General Fund (up 4.2 percent from the current year) and $23.3 billion from special funds (up 5.3 percent from the current year). The overall General Fund spending growth rate reflects (1) changes in caseloads and utilization for major programs; (2) the impacts of the Governor's savings proposals; and (3) the impacts of numerous other special factors, such as one-time savings in the 2004-05 budget. The proposal includes about $3.5 billion in new budgetary borrowing related primarily to deficit-financing bonds, a judgment bond, and Proposition 42 suspension. This brings the total amount of budgetary borrowing outstanding to about $29 billion as of the end of 2005-06.
February 22, 2005 - The current strength in the economy is translating into solid growth in receipts from the state's taxes—particularly the corporate tax and personal income tax. Recent cash receipts trends have been even stronger than anticipated in the Governor's budget, mainly because of strong 2004 year-end collections from the personal income tax and corporation tax. Based largely on these positive trends, we project that General Fund revenues will exceed the budget forecast by $1.4 billion in the current year and $765 million in the budget year.