Bloomberg News

California Revenue $1.26 Billion Below Forecast, Agency Says

November 15, 2011

(Updates shortfall percentage in first paragraph.)

Nov. 14 (Bloomberg) -- California’s revenue trailed projections in October for the fourth consecutive month, bringing the total shortfall to $1.26 billion, a deficit of 5.1 percent, the state Finance Department said.

In October, the most-populous state reported $5.2 billion in tax and fee revenue, 10.5 percent below forecasts for the month, the department said in its monthly bulletin.

The report was in line with figures released Nov. 10 by Controller John Chiang, who said the state was $1.5 billion behind projections since the start of the fiscal year in July.

October’s income taxes, the largest single revenue category, came in 10.6 percent below projections, the Finance Department said, while sales and use taxes, the second-largest category, came in 7.3 percent above estimates.

The shortfall raises the prospect of mid-year budget cuts that would hit universities, social services, public safety programs and schools. Under the $86 billion spending plan Governor Jerry Brown and fellow Democrats adopted in June, a revenue gap of $1 billion or more would trigger a series of automatic cuts. In December, the Finance Department will estimate whether the rest of the year’s revenue can meet the original projection.

--With assistance from Greg Chang in San Francisco. Editors: Pete Young, Mark Schoifet

To contact the reporter on this story: James Nash in Sacramento at jnash24@bloomberg.net

To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net


Best LBO Ever
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus