California Controllor John Chiang had troubling news for Gov. Jerry Brown and other leaders on Friday, announcing that tax revenues for the month of November in the state were almost $1 billion below projections.
“November’s disappointing revenues stand in stark contrast to recent news that California is leading the nation in job growth, has significantly improved its cash liquidity to pay bills, and even long-distressed home values are starting to inch upward,” Mr. Chiang said in a statement. “This serves as a sobering reminder that, while the economy is expanding, it is doing so at a slow and uneven pace that will require the state to exercise care and discipline in how its fiscal affairs are managed in the coming year.”
According to the report, revenues in the month of November were $842.5 million (19 percent) under projections.
Mr. Chiang and other officials blamed part of the shortfall on Facebook, the California-based social media giant that has failed to live up to some market expectations since the company went public in October.
Mr. Chiang, the state’s top financial official, like Mr. Brown, is a Democrat.
Mr. Brown and other Democrats led the successful push for Proposition 30, the voter-approved sales and income tax increases approved on Nov. 6.
Those tax increases, scheduled to take effect in April, were supposed to alleviate the cash-strapped state’s budget woes, but conservatives say the impending higher income tax rates are already driving millionaires and small businesses to relocate out of the state.
Here’s the official statement from Mr. Chiang: http://www.sco.ca.gov/eo_pressrel_12871.html