May 30, 2012
When a Budget Cut Isn’t Really a Cut
Many news stories surrounding the Governor’s May Revision of the 2012-13 budget proposal leave the impression that state revenues in the next fiscal year will be dramatically lower than last year and that overall spending is being cut. The California Budget Fact Check found that:
Revenues are expected to grow in 2012-13 by $4.9 billion without the Governor’s tax increase. On average, the Governor predicts that state revenues would grow 6.6 percent annually over the next four years without a tax increase.
With the Governor’s tax increase and other proposed tax policy changes, revenues would be up $12.5 billion (from $83.2 billion in 2011-12 to $95.7 billion in 2012-13).
Despite the talk about deep cuts, General Fund spending grows by $4.9 billion in 2012-13 in the Governor’s proposal. Between 2012-13 and 2015-16, General Fund spending is expected to grow by 28.8% above 2011-12 levels.
All Spending since 2007-08 is up $30 billion ($194 billion in 2007-08 compared to $225 billion proposed for 2012-13).