◼ Despite the claims from the Senate and Assembly Democratic caucuses or from Gov. Jerry Brown, calling this budget “balanced” is a stretch, to be kind. - Carson Bruno/Fox & Hounds
A quick look shows the spending plan relies upon temporary tax increases, fails to address unfunded pension and retiree obligations, pays down state debt slowly and – surprise – resorts to gimmicks to make the numbers work.
In November 2012, California voters passed Proposition 30, which increased the state sales tax by 0.25% and created four new “millionaire” tax brackets (10.3% for taxable income over $250,000, 11.3% for income over $300,000, 12.3% for income over $500,000, and 13.3% for income over $1 million). The additional revenue generated from the tax increases was sold to the electorate as strictly for education. However, while there is a debate as to whether the money is actually being spent on education, there is no doubt surrounding the temporary nature of the taxes. These taxes expire at the end of FY 2019 – meaning the estimated $6 billion in additional revenue will disappear with them.
