Finance Data Show State Fell $608M Short in October Revenues
On Monday, the state Department of Finance released data showing that California fell $608 million below October revenue expectations, making the total shortfall $1.26 billion for the current fiscal year, the Orange County Register reports.
The release of the data follows an announcement last week by state Controller John Chiang (D) that the state has fallen $1.5 billion short of revenue expectations this year (Joseph, Orange County Register, 11/14).
The figures raise the prospect that deeper cuts to education, and healthÂ and human services programs could be triggered based on forthcoming revenue projections for the remainder of the fiscal year (Nash, Bloomberg, 11/14).
Gov. Jerry Brown (D) signed an $86 billion state budget plan in June.
Lawmakers relied on an assumption that the state would receive $4 billion in new revenue over what previously was expected through June 2012.
If officials determine that revenue has fallen $1 billion short of expectations for this fiscal year, additional cutsÂ could take place automatically. Most cuts would become effective Jan. 1, 2012.
Additional cuts could include:
- $100 million from services for individuals with developmental disabilities; and
- $100 million from the In-Home Supportive Services program for the elderly and people who are blind or have disabilities (California Healthline, 11/11).
Details of the Finance Data
Last month, the state reported $5.2 billion in tax and fee revenue -- an amount that was 10.5% below forecasts for the month, according to the Department of Finance.
TheÂ state's total revenueÂ for the fiscal year to dateÂ isÂ 5.1% below projections.
According to the department, October's income tax revenue registered 10.6% below what was projected. However, sales and use taxes came in 7.3% above estimates (Bloomberg, 11/14).
Prospects for Automatic Cuts
In determining if additional cuts will be needed, officials will consider not only the existing budget data but also what economists estimate will happen in the next eight months.
Later this week, the non-partisan Legislative Analyst's Office is expected to release its budget forecast (Yamamura, "Capitol Alert," Sacramento Bee, 11/14).
The Department of Finance is expected to release its revenue forecast in December (Bloomberg, 11/14).
On Monday, KPCC's "KPCC News" reported on the state's revenue shortfall and the possibility of additional state spending cuts (Small, "KPCC News," KPCC, 11/14).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.