Legislative Analyst Says California Needs To Save More For The Future
Sacramento, CA — The state´s legislative analyst says California can expect a tax windfall for the next budget year that is $2.3 billion more than Governor Schwarzenegger forecast in his budget projection last month.
But rather than celebrate by increasing spending, a legislative analyst says the governor should instead direct the unanticipated money toward closing the state´s multibillion dollar structural deficit.
Schwarzenegger´s budget plan for the fiscal year that begins July first provides a seven percent boost in spending over the current fiscal year without raising taxes, thanks mostly to additional tax revenue.
But the analyst says most of that revenue comes from “volatile sources” such as business earnings and investment income that could dry up with a sudden downtown in the economy.