California tax revenues keep coming in well above projections.
The state controller’s office says February collections have brought the total revenue this fiscal year to a billion dollars above the estimates in Governor Jerry Brown’s January budget proposal. Personal income tax collections led the way.
But although this might seem entirely counterintuitive, the strong revenues could actually make it harder to balance next year’s state budget.
It’s all because of California’s complicated school funding guarantee, Proposition 98. The more money that comes into the state, the higher the baseline funding requirement becomes for schools next year – and that could mean less money for everything else.
The governor and non-partisan Legislative Analyst’s Office have both said they don’t believe there will be much money available for new spending for non-education programs next year.