State Budget

The Legislature’s budget deliberations kicked into high gear this week with committee hearings on Governor Gavin Newsom’s budget revision. The governor’s budget plan includes $9.2 billion in tax increases on California employers, to be imposed by suspending net operating loss provisions and capping the amount of tax credits a business could claim during three tax years. These provisions were discussed in the committees, but not brought to a vote. Assembly Speaker Anthony Rendon truncated the budget process in his house…

Governor Gavin Newsom released his revised budget proposal May 14, a $203.3 billion spending plan for the 2020-21 fiscal year that calls for higher taxes on California businesses via suspending net operating loss provisions and capping the amount of tax credits a business can claim. Newsom proposed the NOL suspension for 2020, 2021, and 2022 for what his budget summary describes as “medium and large businesses,” without additional details. The revised budget also would limit business incentive tax credits from…

The state government could increase funding for K-12 education by properly managing the California Lottery, which owes schools $36 million, the state auditor reported February 25. The auditor originally calculated that the Lottery shortchanged schools by $69 million, but reduced the figure after Lottery officials belatedly provided more documentation. “We shared our calculation with the Lottery of how we arrived at the $69 million that it owed to education several times before it received our draft report,” the auditor wrote.…

Governor Gavin Newsom on January 10 unveiled a $222.2 billion state budget proposal, reflecting a $7.4 billion increase in total spending (general fund and special funds) over the budget enacted in June. The governor said the budget has an operating surplus of $5.6 billion. At a press conference, Newsom touted the “highest level of investment ever” in public education – $84 billion, which represents a 3 percent increase over the current fiscal year, which also represented a record high. The governor’s…