The “Roller Coaster” of California State Budgeting after“过山车”的加利福尼亚州预算.pptVIP

State and Local Tax Policy - Out of the Box, Georgia State University, May 14, 2008 California’s State and Local Revenue Structure After Proposition 13:Is Denial an Appropriate Way to Cope? Robert W. Wassmer Professor and Chairperson Department of Public Policy and Administration California State University, Sacramento Layout of Presentation Introduction California’s Revenue Structure: Pre and Post Proposition 13 Post-Proposition 13 Outcomes How to Better Cope “Out of the Box” Revenue Idea Introduction June 1978 approval of Proposition 13 60% cut in local property taxes California’s state and local reliance on property tax 1977-78: 26% greater than rest of U.S. 2005-06: 24% below rest of U.S. Introduction Introduction Reasons to pay attention 2008-09 budget shortfall in 25 states CA (15.4%) second only to AZ (17.8%) FL, NV, NJ, and RI 10% CA’s relative size in U.S 14% of GDP Cautionary tale to other states Adopted or considering similar fiscal reforms California’s Revenue Structure Sub-national revenue in California and U.S. increased after Prop 13 Per-capita terms CA distance from U.S. has shrunk Personal income terms CA further distanced itself from U.S. California’s Revenue Structure Greater reliance on personal income taxes Highly progressive Top rate of 9.3% at $90K married household Additional 1% levied on millionaires Household incomes $500K yield 1% returns, 39% revenue California’s Revenue Structure California reliance on corporate income taxes still greater than U.S. California reliance on current charge revenue now greater than U.S. California’s Revenue Structure Consider in context of Two-thirds, super-majority vote requirements Pass state budget (elsewhere only in AR and RI) Any statewide increase in taxes for revenue (11 states) Serrano v. Priest Separation of local finances from local schools An anti-tax and initiative constrained environment Table 1 in paper lists 12 propositions since Prop 13 Prop 98 most infamous 40% of state’s general fund expe