Latest Monthly Finance Bulletin Provides Good News
June 23, 2016
The latest revenue information is available from the Department of Finance, and the numbers illustrate positive news for the state’s fiscal health. General Fund monthly revenues are tracking $7 million (0.1 percent) above budget, and year-to-date revenues are $78 million (0.1 percent) above budget projections as well. Personal income tax returns, sales and use tax receipts, and insurance tax revenues are all tracking above budget estimates, while corporation taxes are lower than expected due mostly to a technical timing issue of when refunds were sent out. Another positive highlight is that Prop 63 mental health services account received $5 million more than estimated this month.
However, it’s important to note that this is the first monthly report comparing actual revenues to the May Revision projections. As part of the May Revision, the Department of Finance adjusted budgeted revenue estimates downward.
The other data included in the monthly report is positive, too: California became the sixth largest economy in the world when measuring by gross state product, the unemployment rate continued to drop, job growth and building permits are increasing, and median home price is also on the rise. Sales of existing homes have decreased slightly compared to earlier this year, but are comparable to the 2015 average.
This report comes on the heels of the state budget compromise; while the majority of the budget was passed last week (see the latest CSAC Budget Action Bulletin) there are still some major budget items that remain open. The budget augments the Rainy Day Fund and one-time expenditures in anticipation of an anticipated economic downturn on the horizon.