Revenue Lagging Forecast

California Controller John Chiang Monday said revenues came in $351 million less in June and May than anticipated in the newly adopted state budget.

The spending plan presumed $1.2 billion in additional May and June revenues, above those projected in Gov. Jerry Brown’s May revised budget proposal to be carried over into the new fiscal year, according to Chiang.

Around $849 million of additional revenue had materialized by June 30.

The budget relies on rising revenue projections to make up a portion of its deficit later in the year. If the additional revenue doesn’t show up, spending cuts will be triggered.

June revenues came in 3.7%, or $440 million, above estimates used in the governor’s May budget proposal.

“The success of the newly adopted state budget will depend on continued economic expansion throughout the year,” Chiang said in a news release.

Brown signed the state’s $85.9 billion spending plan on the final day of the fiscal year.

It is the first time in five years the budget has arrived on time.

Lawmakers, relying on the Legislature’s Democratic majority, passed a budget that depends on cuts plus $4 billion of future revenue to fill a $9.6 billion hole.

Chiang said California ended the fiscal year with $95.5 billion in receipts and $93.8 billion in disbursements.

Sales taxes came in above projections by 0.8%, or $21 million, in June, while personal income taxes rose 6.8%, or $410 million, and corporate taxes gained 7.2%, or $156 million.

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