The Wrong Kind of Investment
According to the Governor’s budget writers, the state is forecast to receive $6.3 billion more in tax revenue than estimated in last summer’s Budget Act.i
Much of this unanticipated revenue is the result of a stock market that hit record highs last year.
Given this one-time funding surge, many are asking the question -- what is the best way for California to invest this likely temporary uptick in state revenue?
The California Budget Fact Check found that:
Despite rosy revenue projections, the state’s revenue picture is even more unpredictable this year and it would be wise for the Legislature and the Governor to spend responsibly.
The Governor’s proposed budget will continue to add to its long-term budget problems by hiring new state workers, implementing Obamacare faster than other states, and increasing welfare grant funding.
Setting aside dollars for debt repayment and one-time needs represents a responsible path to invest in the state without adding to the state’s ongoing budget challenges.