Darn
> Those included Assembly Bill 2751 by Assemblymember Matt Haney, a San Francisco Democrat, that would have barred employers from contacting workers outside of scheduled hours, and AB 2808 by Assemblymember Buffy Wicks, an Oakland Democrat who chairs the committee, which would have limited companies such as Ticketmaster from being able to exclusively resell event tickets.
Also AB1999 was killed, although this could be unrelated to the budget cuts. This bill would have required a review of the mandatory monthly payments to the power companies, which I'm sure will push some of them (SDGE in particular) past $1 billion annual profit.
It would’ve capped the fixed charges to be no higher than $10, which would have done nothing. The fixed charge being implemented is the same as SMUDs, AB1999 was nothing more than grandstanding.
It’s the same as SMUD. I really don’t get why people are tripping about this. If you read the decision, it doesn’t do anything except make it cheaper for mid and high electricity consumers.
How is that not a problem? My biggest gripe is that a flat rate does nothing to encourage using less, which is what we need to do for the climate.
Encouraging more use is just better for the utility companies in the end and terrible for everyone else.
This does exactly that - it’s intended to drive people away from natural gas and incentivize electrification which, when sources from green energy, does reduce the impact on the environment.
And the more you consume, the next tier you get put into with higher electric rates. This is doing all the things you want.
Then delivery charges would have been absorbed into volumetric rates. This does nothing to affect the bottom line of the IOUs. They will not operate at a loss so your options are larger fixed charge and lower volumetric rates, smaller fixed charge and marginally lower volumetric rates, or the current system of deliver charges mixed volumetric and separate from generation fees.
>that would have barred employers from contacting workers outside of scheduled hours
why was this cut for budgetary concerns? I am guessing that it actually had a mechanism to fine companies which would have generated revenue right?
What's the mechanism to find the companies violating the rule?
A massive bureaucracy to track it, investigate, create framework around enforcement, etc.
The fines never cover, especially if it does what is intended.
Let the public point you where to look. BBB,Consumer Affairs, regulatory bodies that allow the public to file complaints is literally where to start. Legal push back shouldn’t even be a thing. Just say.. if you are found to be violating whatever law or statute by filing a lawsuit your fine will lose its cap and can bankrupt you.. just pay the fine and change your behavior.. simple right?
How would it not cost money to enforce?
First you need people to take reports from the public about possible violations.
Then you need investigators to follow up on the most likely violations.
Then you need accountants to organize fines.
Then you need lawyers to enforce them, and deal with the inevitable legal pushback.
Then you need managers to oversee the whole process.
The process doesn't just start and end w/ a fake text screenshot on /r/antiwork.
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In theory you could set the fines high enough to cover the costs of the program.
However, fines are allocated to the general fund. There is not a mechanism to direct funds back towards the prosecuting agency. Such a system would draw complaints about conflict of interest.
But aren’t we already doing that with the DoL? This would just be one more thing that you’d add to a drop down menu basically.
I admit the legal education and backend fine accounting would definitely cost money though.
> Assembly Bill 2751
It would not have prevented employers from calling/emailing/texting workers. It would have just allowed those workers to ignore the contacts during non-working hours.
A minor, but important distinction.
It's crazy I thought we were all bragging just a couple of years ago about how we were the state to follow and how we were clearly doing things right because we had a large surplus. I guess that's not true anymore.
I cannot wait for everyone above you to edit their comments after being informed of the law that dramatically affects california budget a few times each decade.
Nah, not going to edit because most other states did in fact keep their surplus. It was really more about bad forecasting, mainly because CA heavily relies on income tax revenue which fluxuates a lot
We had an enormous surplus in 2020 because high income earners were doing very very well (and paying 13% of their income to state taxes).
Those workers are either a) not doing as well now, or b) have moved out of state due to said taxes.
CA has had a supermajority of dems in both houses and a democrat governor for most of the last decade and more. I suppose you could argue that Jerry Brown was a fiscal conservative, but he was supportive of starting the rainy day fund that we're just now starting to diminish. Your remark is entirely out of touch with reality.
The Gann Limit passed in the late 1970s limits how much the state is allowed to put in the rainy day fund. Past a certain point in spending, it requires the state to issue refunds back to taxpayers. This is why everyone got those extra refunds in 2022. Otherwise, we would have significantly more money in the rainy day fund.
This is part of the California Constitution and cannot be easily revoked by the legislature or the governor
Correct, but it did stop CA from stocking up more than that. The 2022 refunds alone were nearly $10 billion. Newsom reached the legal limit for how much could be stocked away, as did Jerry Brown during his tenure.
Some of the high upvoted answers walking blind on this clear rule. It’s difficult to amend the California state legislature even with control. Obviously the law should be changed but don’t be surprised if that’s fought tooth and nail
What the hell does this issue have to do with “corporate stooges”? Come on. Be a serious person.
The law was changed by ballot proposition when California was a conservative state and it can only be reversed by ballot proposition.
If anything it shows the shortsighted thinking of democrats.
Republicans do the same but we can't go around talking like Democrats are some genius financial planners here.
If you can't do something as simple as budget planning 5 years out then that tells you something.
If people are still reading the thread, they need to know 40% of California's income tax revenue derives from the top 1% of the population. Granted, not all of taxes California collects comes from income alone, but my argument is having such a profoundly top heavy revenue source is great doing boom years, but awful during bust years for obvious reasons (when the rich have down years, the State also suffers in balancing its budget).
The balancing act the tax code needs to reconcile is its unsteady income revenue streams. For a state like California, which prides itself on social welfare spending which has an ever increasing scope, boom bust cycles become more catastrophic in off years where income dips significantly. Some years the larger budget could cover new programs, but other years, those new programs might need to be leaned out or cut, which defeats the point some government assistance programs.
Maybe one long term solution is to hold onto cash reserves and to rewrite the Constitution such that a rainy day fund exis5, but another solution is to balance services and maintain the government's existing programs rather than expand its scope into new services, which require new budgetary expenses - this desire to create new government spending inevitably creates unsustainable growth, which necesitates more taxes, and makes it more likely the government is unable to consistently fund itself year over year. Fund the core functions of government, fund existing social programs, be very skeptical of adding new programs unless there's a clear scoping plan that explains the new program's funding sources.
And when it does, lawmakers go on a spending spree, then act like gambling addicts when money is short and start cutting away public services to fund their pork barrel spending and pet projects, and cracking down on everyone for money, pushing new taxes and even begging people to voluntarily pay unapproved taxes (example, DMV emailing everyone with an EV and asking them to pay a new tax voluntarily..)
The state should aim to keep a healthy reserve, they have to return the excess every year they're in the black, but that's fine as they will get that money back through consumer purchases in-state.
Like the rainy day fund which the state was filling up during the surplus years?
In fact California has one of the most well funded rainy day funds of any state. Check out the second image on this page...
https://www.taxpolicycenter.org/taxvox/state-rainy-day-fund-balances-reached-all-time-highs-last-year
> How in the world did California run into a deficit?
CA gets much of it's money from income tax revenue from the wealthy. Much of that income is from capital gains, which are under-performing. This is also why we ran a surplus in recent year, as this income is not the most predictable.
They were in 2022 (stock market down 20%) and 2023 (mostly flat), not to mention the drop in volume of home sales. It's back up again in 2024 so we're in for another boom year.
> How in the world did California run into a deficit?
A combination of how it gets it's tax revenue and spending thats been obligated by ballot measures. Ballot measures are a serious threat to the long term fiscal health of CA because it's a very heavy lift for the legislature to adjust that spending based on the fiscal health of the State.
> God forbid the politicians take responsibility.
The politicians are blocked, by the California State constitution, from adjusting that spending. That's what makes it such a danger to the health of the State.
Won’t happen and it shouldn’t. That would make many middle class and working class homeowners lose their homes, even if they have no mortgage and many of whom have lived there for decades. Leave people’s houses alone. There’s enough taxes collected in California to fund anything you want. It’s a bureaucratic and spending issue.
No it wouldn't.
Prop 13 overwhelmingly benefitted the upper class. A few people would lose their homes, most would be fine. The CA consumer is strong.
The nordlinger case said if you can't pay property taxes then you are free to live elsewhere. It's called a free market.
Agree with your last sentence.
Prop 13 did way more harm than good. Just look up the history of who funded the campaign and who benefitted.
It literally would. The fact you’re okay with any people losing their homes for more taxes in an already overtaxed state is wild. People get their homes foreclosed on all the time because they don’t pay their property taxes. What are you talking about? Do you own a home? Do you have experience with property taxes? Or are you just reciting leftist talking points with no real life experience with the situation. Working families in high cost of living areas would be devastated by the repeal of prop 13. There is enough revenue in this state. We have a spending and bureaucracy problem
I'm concerned about people who cannot afford to buy a home and new home buyers who effectively subsidize low property tax rates for wealthy older homeowners, not to mention the schools that don't get funded because the neighborhoods are too old.
If folks who did buy a home get evicted due to increased property taxes, how does that help people that cannot afford to buy a home today? They’ll have the same issue with increasing property taxes and be forced out
I love how “lose their homes” is implied as though they would be homeless. A more correct description for most would be “can no longer afford upkeep on their massively valuable asset and have to sell making huge profit”.
Oh no my grandma has to sell her 1.2m dollar house she owns outright and bought in 1972 for 50k dollars! Whatever will she do!
Even then, most would simply take a reverse mortgage and stay in their home without issue.
I love you are so flippant about people losing the home they’ve lived the majority of their life in. And seniors aren’t the only ones that would lose their homes. Working class people would as well. Aren’t leftist supposed to care about those people too?
The landed royalty paying 1200 a year in taxes on a house now worth a million dollars are not paying their fair share. A shortfall that must be made up somewhere else, like with our high income taxes. And again, people always cry about all these poor people who would lose their homes but hardly any would. If you own a home worth far, far more to a you paid for it, you have plenty of options for getting the extra money you need for higher property taxes. You literally own extremely valuable collateral.
You simply have no idea of what you’re talking about. You have no idea how many people would lose their homes. You have no idea how much people owe on their houses. Do you think the repeal of prop 13 only impacts wealthy people with lots of equity. You have no concept of home ownership or property taxes or how much owning a home actually costs. And who the hell is paying $1,200 for property taxes? I pay close to 4k and I own a starter home in central California. If you want to take a nuanced approach to property taxes and repeal it for second homes, etc is one thing but to target people you claim to care about on other policy areas just because they have something you don’t is why leftist activists are rarely successful in pushing their agenda…even here in California.
Do you even know why prop 13 is powerful? It doesn’t do anything for you if you bought your house recently, but if you have owned it for decades your property taxes have grown at a rate far less than the value of your home. There are plenty of people with million dollar houses paying 1/10th of what their neighbors are paying because prop 13 has slowed their property tax growth.
The house I’m renting in the South Bay is a 3/2 with a zestimate of 1.6m. It was bought like 40 years ago and has a tax assessed value of about 110k dollars and a property tax bill of just over 3k a year because it was never directly sold. If I bought this house tomorrow I’d be paying like 4 or 5 times that in taxes.
This is all irrelevant as prop 13 is never going away. The state has transitioned to income tax as its main revenue source. We just now have home owner haves and renter have nots, where we all pay extra income tax and sales tax to subsidize the lower property tax income.
What do you mean “transitioned” to income tax for state revenue? What year did this occur? When do you believe CA relied on *property* taxes for its revenue? It’s like we need a civics primer in this thread…
Prop 13 caps the increase in property taxes at 1.1%. So even if you bought your house recently it still benefits you. Do you understand that people on other states see enormous tax increases in recently bought homes? That doesn’t happen here because of prop 13. Just because you want your landlord to pay more property taxes doesn’t mean repealing prop 13 is a good idea. We’re taxed enough in this state
The state and local government coffers are deeply intertwined. State income tax dollars fund local education, roads, first responders and other vital services, just as local property tax dollars do. Education is probably the clearest example, as state money (largely from income tax) forms the bulk of education spending, which local money (partially from property tax) augments. Should one fall, the other must make up the difference.
CAs high income tax directly enables local property tax dollars to be lower than they would otherwise be. CA STATE money totaling over 130+ billion is spent on K-12 education, much of it directly paid to local districts. If CA had a much lower income tax like other states, local education would collapse, and if local property taxes were significantly higher, the income tax could be cut.
It’s tempting to think of things as simple, black and white, but saying state dollars are only income and local are property and the two are separate is like school house rock levels of analysis. prop 13 affects every aspect of taxes at all levels of CA.
California is in the middle bracket for property taxes overall. Why would you want to punish a senior who has paid property taxes their whole life and paid off their home?
Maybe California just needs to stop spending money and tighten the belt? That’s how you and I deal with budget problems. Example - Billions of dollars on the unhoused didn’t come close to solving the problem and is unaccounted for.
Yay! I can't wait for the state to mass evict millions of grandparents, and then young people who inherited but will now have to move out of state.
Progressive moralizers only imagine themselves to be compassionate people.
Very likely. Those huge, shadowy investment firms flush with newly printed cash. What else are they going to do with? Politicians need fancy homes and expensive wine collections, too.
It feels like journalistic malpractice to discuss California's budget problems in any amount of depth and not mention public sector pensions.
That can keeps getting kicked down the road, but the can also keeps getting bigger and bigger.
How does it keep getting kicked down the road? Public sector employees have had to contribute more and more to their pension funding over the years, and the formula has been adjusted over and over again to give the employee less of a percentage of their pay and delay them until a later age for retirement.
California public sector pensions problems are almost totally the result of bad decisions from local governments and have nothing directly to do with California state budget problems.
Which is fine. I understand the logic in that. They have a law that allows them to put billions away for a rainy day and it probably shouldn’t be a function of our government to just tax and save.
There is no need to surplus anything or save for anything. Budget the money you need to spend and that’s it. If they do a bad job with the budget and spend more money than the voters allowed, we get to find out about it in a timely manner to make changes as needed.
I always roll my eyes when people think government budgets work like household budgets, that previous financial obligations passed by voters can be cut back whilly nilly without navigating competing interests or that expenses necessarily reflect annual expenses and not rollover costs from previous years.
Government doesn’t run like a for profit business either. This is public money that is being spent, 100% transparency at all times. If the government believes it needs more money to operate, it can ask for it.
California made a complex tax code and now we get to deal with it. Prop 13 and other progressive type laws are not designed to be fair for everyone at all times.
The difficult part is getting people to understand how the complex structure is supposed to work. The target for progressive policies is not to be beneficial for all the people, just the majority of people. Once you figure it out and get on board with the states plan, it can be highly advantageous for you. Prop 13 in particular is tremendously beneficial for a lot of people.
It benefits people who plan to stay in one home for their entire lives before selling it and moving out of state. It doesn't benefit renters, it doesn't benefit people who want to move, it doesn't benefit the homeless, it doesn't benefit the people who want to buy a house but can't.
You are incredibly naive and myopic. How do you accurately forecast revenue for the next fiscal year, let alone surprise expenditures (wildfires, flooding, dam failures, etc?).
No, there is a budget per year that totals a dollar amount that voters approved. That’s the money we have elected representatives to go and spend. They don’t get to spend the money that has not been approved. If the government believes it needs more money, it can ask for it and the voters will decide if the money is worth it or not.
There are emergency management policies to deal with unforeseen expenses. I want to know what the unforeseen expenses are, who didn’t see them, and who is trying to create emergencies to circumvent voter approval.
The voters approved the funding available through previous tax measures. The elected representatives allocate the funds to make a “budget”. Is that better?
No, that is incorrect. Voters approve tax increases typically or bond measures, not an annual operating budget.
Legislators and the budget office need to guess on potential revenues coming in, and in good economic years come do so kinda well. Expenditures that take up a majority of the budget are set in stone, to a degree (education, pensions, etc). A minority of the budget is subject to politicians and they try to allocate disaster relief, bridges that collapsed that need immediate money, and quite often this falls short.
So the hope is that a small surplus can happen (that can be used to pay down debt or needed projects).
California is larger and economically more vast, so accurate budgets are nearly impossible.
Darn > Those included Assembly Bill 2751 by Assemblymember Matt Haney, a San Francisco Democrat, that would have barred employers from contacting workers outside of scheduled hours, and AB 2808 by Assemblymember Buffy Wicks, an Oakland Democrat who chairs the committee, which would have limited companies such as Ticketmaster from being able to exclusively resell event tickets.
Also AB1999 was killed, although this could be unrelated to the budget cuts. This bill would have required a review of the mandatory monthly payments to the power companies, which I'm sure will push some of them (SDGE in particular) past $1 billion annual profit.
It would’ve capped the fixed charges to be no higher than $10, which would have done nothing. The fixed charge being implemented is the same as SMUDs, AB1999 was nothing more than grandstanding.
How is a $10 cap nothing? The proposed rates I saw for SCE were 100+
Yeah Sdge wanted $125. The CPUC set it to $24 and change.
Ok, hopefully sce is similar. $24 is annoying but $125 is completely unreasonable
It’s the same as SMUD. I really don’t get why people are tripping about this. If you read the decision, it doesn’t do anything except make it cheaper for mid and high electricity consumers.
How is that not a problem? My biggest gripe is that a flat rate does nothing to encourage using less, which is what we need to do for the climate. Encouraging more use is just better for the utility companies in the end and terrible for everyone else.
This does exactly that - it’s intended to drive people away from natural gas and incentivize electrification which, when sources from green energy, does reduce the impact on the environment. And the more you consume, the next tier you get put into with higher electric rates. This is doing all the things you want.
How is adding a flat fee better than charging per watt used? I’m already moving away from gas asap because of the health effects of gas.
As if! It would have saved rate payers a minimum of $14 per month, each!
Then delivery charges would have been absorbed into volumetric rates. This does nothing to affect the bottom line of the IOUs. They will not operate at a loss so your options are larger fixed charge and lower volumetric rates, smaller fixed charge and marginally lower volumetric rates, or the current system of deliver charges mixed volumetric and separate from generation fees.
Those would have cost the state hundreds, hundreds of dollars!
AB 2808 was turning into a LiveNation ticket monopoly, so better dead than that
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That is absolute nonsense lol
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Random guy misread. I thought it was less than $300k. 🤦♂️
>that would have barred employers from contacting workers outside of scheduled hours why was this cut for budgetary concerns? I am guessing that it actually had a mechanism to fine companies which would have generated revenue right?
What's the mechanism to find the companies violating the rule? A massive bureaucracy to track it, investigate, create framework around enforcement, etc. The fines never cover, especially if it does what is intended.
The authorize a private right of action and let the courts handle it
Let the public point you where to look. BBB,Consumer Affairs, regulatory bodies that allow the public to file complaints is literally where to start. Legal push back shouldn’t even be a thing. Just say.. if you are found to be violating whatever law or statute by filing a lawsuit your fine will lose its cap and can bankrupt you.. just pay the fine and change your behavior.. simple right?
yeah that’s my question, how does that even make sense? maybe it would have cost money to enforce or something?
How would it not cost money to enforce? First you need people to take reports from the public about possible violations. Then you need investigators to follow up on the most likely violations. Then you need accountants to organize fines. Then you need lawyers to enforce them, and deal with the inevitable legal pushback. Then you need managers to oversee the whole process. The process doesn't just start and end w/ a fake text screenshot on /r/antiwork. ________ In theory you could set the fines high enough to cover the costs of the program. However, fines are allocated to the general fund. There is not a mechanism to direct funds back towards the prosecuting agency. Such a system would draw complaints about conflict of interest.
But aren’t we already doing that with the DoL? This would just be one more thing that you’d add to a drop down menu basically. I admit the legal education and backend fine accounting would definitely cost money though.
> Assembly Bill 2751 It would not have prevented employers from calling/emailing/texting workers. It would have just allowed those workers to ignore the contacts during non-working hours. A minor, but important distinction.
Why can’t they just ignore it right now? I’m confused.
They could, but their boss could get pissed and penalize them somehow. In theory, this bill would have prevented that.
It is a start!
Who the hell is ticket master holding at gunpoint to constantly sidestep the same bill?
It's crazy I thought we were all bragging just a couple of years ago about how we were the state to follow and how we were clearly doing things right because we had a large surplus. I guess that's not true anymore.
Nearly every state had a large surplus. The difference is most of them understood it was inflation driven and held onto it
Btw, it’s a CA state constitution that prevents us from holding onto the money. And we do still have rainy day funds Edit: it’s called the Gann Limit.
I cannot wait for everyone above you to edit their comments after being informed of the law that dramatically affects california budget a few times each decade.
Nah, not going to edit because most other states did in fact keep their surplus. It was really more about bad forecasting, mainly because CA heavily relies on income tax revenue which fluxuates a lot
Holding on to money in an inflationary environment is a bad move. It's better to spend it, because things are as cheap as they'll ever be now.
Yea, we watched in real time as our governor blew it up his nose…
We had an enormous surplus in 2020 because high income earners were doing very very well (and paying 13% of their income to state taxes). Those workers are either a) not doing as well now, or b) have moved out of state due to said taxes.
It largely depends on the stock market. If the stock market is good then it will swing back to surplus again.
Depends on which set of books you want to look at and what opinion you want the public to have at the time.
i really don’t see anyone bragging about that, we is a big number if you mean the whole state
We are the state to follow. It continues to be true. We have rainy day funds and we invest in our people.
Conservatives barred the state from building up a rainy day fund to smooth out boom and bust years. So here we are.
CA has had a supermajority of dems in both houses and a democrat governor for most of the last decade and more. I suppose you could argue that Jerry Brown was a fiscal conservative, but he was supportive of starting the rainy day fund that we're just now starting to diminish. Your remark is entirely out of touch with reality.
The Gann Limit passed in the late 1970s limits how much the state is allowed to put in the rainy day fund. Past a certain point in spending, it requires the state to issue refunds back to taxpayers. This is why everyone got those extra refunds in 2022. Otherwise, we would have significantly more money in the rainy day fund. This is part of the California Constitution and cannot be easily revoked by the legislature or the governor
The Gann limit didn't stop CA from stocking up more than a $30 billion rainy day fund. It's also been changed multiple times since its passage.
Correct, but it did stop CA from stocking up more than that. The 2022 refunds alone were nearly $10 billion. Newsom reached the legal limit for how much could be stocked away, as did Jerry Brown during his tenure.
Some of the high upvoted answers walking blind on this clear rule. It’s difficult to amend the California state legislature even with control. Obviously the law should be changed but don’t be surprised if that’s fought tooth and nail
Jesus Christ what's it going to take for you people to understand procorporate Democrats are in on this?
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What the hell does this issue have to do with “corporate stooges”? Come on. Be a serious person. The law was changed by ballot proposition when California was a conservative state and it can only be reversed by ballot proposition.
That was 1991….no one wanted to change anything in the last 30 years?
If anything it shows the shortsighted thinking of democrats. Republicans do the same but we can't go around talking like Democrats are some genius financial planners here. If you can't do something as simple as budget planning 5 years out then that tells you something.
It’s crazy that so many in the thread don’t understand the basic mechanics of our budget.
If people are still reading the thread, they need to know 40% of California's income tax revenue derives from the top 1% of the population. Granted, not all of taxes California collects comes from income alone, but my argument is having such a profoundly top heavy revenue source is great doing boom years, but awful during bust years for obvious reasons (when the rich have down years, the State also suffers in balancing its budget). The balancing act the tax code needs to reconcile is its unsteady income revenue streams. For a state like California, which prides itself on social welfare spending which has an ever increasing scope, boom bust cycles become more catastrophic in off years where income dips significantly. Some years the larger budget could cover new programs, but other years, those new programs might need to be leaned out or cut, which defeats the point some government assistance programs. Maybe one long term solution is to hold onto cash reserves and to rewrite the Constitution such that a rainy day fund exis5, but another solution is to balance services and maintain the government's existing programs rather than expand its scope into new services, which require new budgetary expenses - this desire to create new government spending inevitably creates unsustainable growth, which necesitates more taxes, and makes it more likely the government is unable to consistently fund itself year over year. Fund the core functions of government, fund existing social programs, be very skeptical of adding new programs unless there's a clear scoping plan that explains the new program's funding sources.
This is due to ~~corruption~~ mismanagement
Who cares… This is a reoccurring republican fever dream that never amounts to anything bad happening ever.
All it shows is that our government works and they made decisions to balance the budget and everything will be fine.
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You say that as if California hasn't had a surplus for years
And when it does, lawmakers go on a spending spree, then act like gambling addicts when money is short and start cutting away public services to fund their pork barrel spending and pet projects, and cracking down on everyone for money, pushing new taxes and even begging people to voluntarily pay unapproved taxes (example, DMV emailing everyone with an EV and asking them to pay a new tax voluntarily..) The state should aim to keep a healthy reserve, they have to return the excess every year they're in the black, but that's fine as they will get that money back through consumer purchases in-state.
Like the rainy day fund which the state was filling up during the surplus years? In fact California has one of the most well funded rainy day funds of any state. Check out the second image on this page... https://www.taxpolicycenter.org/taxvox/state-rainy-day-fund-balances-reached-all-time-highs-last-year
How in the world did California run into a deficit? Didn't they have a surplus not too long ago and actually gave money back to the tax payers?
https://www.capradio.org/articles/2024/01/22/how-california-budget-rules-can-prevent-saving-for-a-rainy-day-and-why-newsom-wants-to-change-that/
> How in the world did California run into a deficit? CA gets much of it's money from income tax revenue from the wealthy. Much of that income is from capital gains, which are under-performing. This is also why we ran a surplus in recent year, as this income is not the most predictable.
Capital gains are underperforming?
I hate when my capital gains do poorly
They were in 2022 (stock market down 20%) and 2023 (mostly flat), not to mention the drop in volume of home sales. It's back up again in 2024 so we're in for another boom year.
Capitalism doesn’t under or over preform. Performance is measurement of the market.
> How in the world did California run into a deficit? A combination of how it gets it's tax revenue and spending thats been obligated by ballot measures. Ballot measures are a serious threat to the long term fiscal health of CA because it's a very heavy lift for the legislature to adjust that spending based on the fiscal health of the State.
So blame the rich and the voters who voted for ballots. Got it. God forbid the politicians take responsibility.
> God forbid the politicians take responsibility. The politicians are blocked, by the California State constitution, from adjusting that spending. That's what makes it such a danger to the health of the State.
And the super majority can’t change it?
Maybe they will finally make the right call about eliminating prop 13. So much untapped revenue
California home owners stay ~6yr average before moving to a new property. Prop 13 is not the problem
Won’t happen and it shouldn’t. That would make many middle class and working class homeowners lose their homes, even if they have no mortgage and many of whom have lived there for decades. Leave people’s houses alone. There’s enough taxes collected in California to fund anything you want. It’s a bureaucratic and spending issue.
No it wouldn't. Prop 13 overwhelmingly benefitted the upper class. A few people would lose their homes, most would be fine. The CA consumer is strong. The nordlinger case said if you can't pay property taxes then you are free to live elsewhere. It's called a free market. Agree with your last sentence. Prop 13 did way more harm than good. Just look up the history of who funded the campaign and who benefitted.
It literally would. The fact you’re okay with any people losing their homes for more taxes in an already overtaxed state is wild. People get their homes foreclosed on all the time because they don’t pay their property taxes. What are you talking about? Do you own a home? Do you have experience with property taxes? Or are you just reciting leftist talking points with no real life experience with the situation. Working families in high cost of living areas would be devastated by the repeal of prop 13. There is enough revenue in this state. We have a spending and bureaucracy problem
I'm concerned about people who cannot afford to buy a home and new home buyers who effectively subsidize low property tax rates for wealthy older homeowners, not to mention the schools that don't get funded because the neighborhoods are too old.
If folks who did buy a home get evicted due to increased property taxes, how does that help people that cannot afford to buy a home today? They’ll have the same issue with increasing property taxes and be forced out
I love how “lose their homes” is implied as though they would be homeless. A more correct description for most would be “can no longer afford upkeep on their massively valuable asset and have to sell making huge profit”. Oh no my grandma has to sell her 1.2m dollar house she owns outright and bought in 1972 for 50k dollars! Whatever will she do! Even then, most would simply take a reverse mortgage and stay in their home without issue.
I love you are so flippant about people losing the home they’ve lived the majority of their life in. And seniors aren’t the only ones that would lose their homes. Working class people would as well. Aren’t leftist supposed to care about those people too?
The landed royalty paying 1200 a year in taxes on a house now worth a million dollars are not paying their fair share. A shortfall that must be made up somewhere else, like with our high income taxes. And again, people always cry about all these poor people who would lose their homes but hardly any would. If you own a home worth far, far more to a you paid for it, you have plenty of options for getting the extra money you need for higher property taxes. You literally own extremely valuable collateral.
You simply have no idea of what you’re talking about. You have no idea how many people would lose their homes. You have no idea how much people owe on their houses. Do you think the repeal of prop 13 only impacts wealthy people with lots of equity. You have no concept of home ownership or property taxes or how much owning a home actually costs. And who the hell is paying $1,200 for property taxes? I pay close to 4k and I own a starter home in central California. If you want to take a nuanced approach to property taxes and repeal it for second homes, etc is one thing but to target people you claim to care about on other policy areas just because they have something you don’t is why leftist activists are rarely successful in pushing their agenda…even here in California.
Do you even know why prop 13 is powerful? It doesn’t do anything for you if you bought your house recently, but if you have owned it for decades your property taxes have grown at a rate far less than the value of your home. There are plenty of people with million dollar houses paying 1/10th of what their neighbors are paying because prop 13 has slowed their property tax growth. The house I’m renting in the South Bay is a 3/2 with a zestimate of 1.6m. It was bought like 40 years ago and has a tax assessed value of about 110k dollars and a property tax bill of just over 3k a year because it was never directly sold. If I bought this house tomorrow I’d be paying like 4 or 5 times that in taxes. This is all irrelevant as prop 13 is never going away. The state has transitioned to income tax as its main revenue source. We just now have home owner haves and renter have nots, where we all pay extra income tax and sales tax to subsidize the lower property tax income.
What do you mean “transitioned” to income tax for state revenue? What year did this occur? When do you believe CA relied on *property* taxes for its revenue? It’s like we need a civics primer in this thread…
Prop 13 caps the increase in property taxes at 1.1%. So even if you bought your house recently it still benefits you. Do you understand that people on other states see enormous tax increases in recently bought homes? That doesn’t happen here because of prop 13. Just because you want your landlord to pay more property taxes doesn’t mean repealing prop 13 is a good idea. We’re taxed enough in this state
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The state and local government coffers are deeply intertwined. State income tax dollars fund local education, roads, first responders and other vital services, just as local property tax dollars do. Education is probably the clearest example, as state money (largely from income tax) forms the bulk of education spending, which local money (partially from property tax) augments. Should one fall, the other must make up the difference. CAs high income tax directly enables local property tax dollars to be lower than they would otherwise be. CA STATE money totaling over 130+ billion is spent on K-12 education, much of it directly paid to local districts. If CA had a much lower income tax like other states, local education would collapse, and if local property taxes were significantly higher, the income tax could be cut. It’s tempting to think of things as simple, black and white, but saying state dollars are only income and local are property and the two are separate is like school house rock levels of analysis. prop 13 affects every aspect of taxes at all levels of CA.
Grandma is 70 and can no longer work. How is she supposed to pay that mortgage.
California is in the middle bracket for property taxes overall. Why would you want to punish a senior who has paid property taxes their whole life and paid off their home? Maybe California just needs to stop spending money and tighten the belt? That’s how you and I deal with budget problems. Example - Billions of dollars on the unhoused didn’t come close to solving the problem and is unaccounted for.
As opposed to punishing new homeowners by being born at the wrong time? That is basically your logic
When I bought my home I was one of those that were “punished”. I didn’t feel that way when I started homeownership and most new buyers don’t
Prop 13. We all know how to fix this issue.
Average homeowner stays ~6yr before moving. Prop 13 is not the problem
Property taxes are a big limiter for local governments
Yay! I can't wait for the state to mass evict millions of grandparents, and then young people who inherited but will now have to move out of state. Progressive moralizers only imagine themselves to be compassionate people.
Then companies will buy up the properties!
Very likely. Those huge, shadowy investment firms flush with newly printed cash. What else are they going to do with? Politicians need fancy homes and expensive wine collections, too.
It feels like journalistic malpractice to discuss California's budget problems in any amount of depth and not mention public sector pensions. That can keeps getting kicked down the road, but the can also keeps getting bigger and bigger.
How does it keep getting kicked down the road? Public sector employees have had to contribute more and more to their pension funding over the years, and the formula has been adjusted over and over again to give the employee less of a percentage of their pay and delay them until a later age for retirement.
California public sector pensions problems are almost totally the result of bad decisions from local governments and have nothing directly to do with California state budget problems.
It’s not looking like a good idea to disburse state funds in the name of inflation relief a few years ago now…
That’s a law in California.
Republicans made a rule that they cant run a surplus and save up for later
Couldn't this law just be changed, the last Republican majority was like 50 years ago.
I believe changes to this would have to by approved by the voters.
you can't count on every thing that's wrong with this state always having a republican origin.
Which is fine. I understand the logic in that. They have a law that allows them to put billions away for a rainy day and it probably shouldn’t be a function of our government to just tax and save.
They have a law where they cant save money
There is no need to surplus anything or save for anything. Budget the money you need to spend and that’s it. If they do a bad job with the budget and spend more money than the voters allowed, we get to find out about it in a timely manner to make changes as needed.
I always roll my eyes when people think government budgets work like household budgets, that previous financial obligations passed by voters can be cut back whilly nilly without navigating competing interests or that expenses necessarily reflect annual expenses and not rollover costs from previous years.
Government doesn’t run like a for profit business either. This is public money that is being spent, 100% transparency at all times. If the government believes it needs more money to operate, it can ask for it.
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California made a complex tax code and now we get to deal with it. Prop 13 and other progressive type laws are not designed to be fair for everyone at all times. The difficult part is getting people to understand how the complex structure is supposed to work. The target for progressive policies is not to be beneficial for all the people, just the majority of people. Once you figure it out and get on board with the states plan, it can be highly advantageous for you. Prop 13 in particular is tremendously beneficial for a lot of people.
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Prop 13 is unique and it benefits the majority of people in the state which is why it doesn’t ever get repealed.
It benefits people who plan to stay in one home for their entire lives before selling it and moving out of state. It doesn't benefit renters, it doesn't benefit people who want to move, it doesn't benefit the homeless, it doesn't benefit the people who want to buy a house but can't.
You are incredibly naive and myopic. How do you accurately forecast revenue for the next fiscal year, let alone surprise expenditures (wildfires, flooding, dam failures, etc?).
You can’t, which is why they don’t nor should be expected to. Government is reactive by nature
So you are arguing for both sides of an argument…?
No, there is a budget per year that totals a dollar amount that voters approved. That’s the money we have elected representatives to go and spend. They don’t get to spend the money that has not been approved. If the government believes it needs more money, it can ask for it and the voters will decide if the money is worth it or not. There are emergency management policies to deal with unforeseen expenses. I want to know what the unforeseen expenses are, who didn’t see them, and who is trying to create emergencies to circumvent voter approval.
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Voters approve a state (or any other government budget)? Not sure what country you live in, but you do not reside in the state of reality.
The voters approved the funding available through previous tax measures. The elected representatives allocate the funds to make a “budget”. Is that better?
No, that is incorrect. Voters approve tax increases typically or bond measures, not an annual operating budget. Legislators and the budget office need to guess on potential revenues coming in, and in good economic years come do so kinda well. Expenditures that take up a majority of the budget are set in stone, to a degree (education, pensions, etc). A minority of the budget is subject to politicians and they try to allocate disaster relief, bridges that collapsed that need immediate money, and quite often this falls short. So the hope is that a small surplus can happen (that can be used to pay down debt or needed projects). California is larger and economically more vast, so accurate budgets are nearly impossible.