California Financial Report for May

The State Controller’s office has released the May financial report for the California General fund. Eleven months in the fiscal year (2014-2015), total receipts were up by 12.0% to $99.6 billion compared with the same period last year. Total disbursements ($107.6 billion) increased by 13.3% over the same period, exceeding cash receipts by $8.0 billion. As of May 31, the state’s cash balance stood at -$6.1 billion.

Total revenues (receipts from taxes, licenses, fees or investment earnings) were up by 12.4% to $97.5 billion compared with the first 11 months of the previous fiscal year. The state relies most heavily on personal income tax revenues, followed by sales and use taxes, and then to a much smaller extent, corporate income taxes. Year-to-date, nearly 70% of general revenue funds have come from personal income taxes.

• In May (fiscal year-to-date), personal income taxes increased by 14.8% to $65.4 billion and were in line with projections

• Corporate income taxes rose by 26.0% to $7.6 billion, falling just short of expectations (-0.3%)

• Revenues from sales and use taxes were up by 4.6% to $21.1 billion, running marginally ahead (by 0.1%) of forecasts

The schedule of cash disbursements in the Controller’s report showed that expenditures on Local K-12 Education were $40.2 billion during the first 11 months of the fiscal year, which was up by 16.2% compared with the previous year. Disbursements to Community Colleges increased by 20.4% to $4.4 billion. Funds received by the UC and CSU systems rose by 9.5% to $5.9 billion. Contributions to CalSTRS (the state teachers’ pension fund) increased by 9.3% to $1.5 billion.

Spending for the Department of Corrections increased by 9.9% to $8.9 billion, while outlays for Health and Human Services rose by 8.6% to $2.2 billion. The amount the state paid to service its debt obligation was up by 8.5% to $4.7 billion (debt service amounts are net of offsets such as federal subsidies and reimbursements for other services).

So far this fiscal year, General Fund receipts are running 0.1% ahead of Department of Finance projections. Unfortunately, disbursements were also slightly higher than expected with spending pushing past expectations by 0.7%.

As of May 31, the General Fund had $32.2 billion in borrowable resources against $6.1 billion in outstanding loans. The loan balance is comprised of $3.3 billion in internal borrowing and $2.8 billion of external borrowing in the form of revenue anticipation notes.

Sources:  http://www.sco.ca.gov/eo_pressrel.html