SAN FRANCISCO — California revenues came in at $6 billion for the month of October-12.3% above estimates, according to State Controller John Chiang.
For the fiscal year, which began July 1, total revenues reached $27.9 billion, beating estimates made by the Department of Finance by $1.2 billion.
"Four months into the fiscal year, California's coffers overflow by $1.2 billion," Chiang said in a statement Nov. 10. "The news comes on the heels of two other positive developments: the vote to strengthen California's rainy-day fund through Proposition 2, and the credit upgrade that followed one day later."
According to Chiang's monthly report covering the state's cash balance, receipts, and disbursements income tax collections for October totaled $363.5 million, or 8.4% above estimates. Corporate tax revenues came in $33.6 million above estimates.
The controller's office said the positive results from both the personal income and corporate tax revenues reflect and validate the solid economic expansion California continues to enjoy.
Higher-than-estimated withholding was the most significant driver behind the amount of personal income tax revenues. Rapid growth in the technology sector, producing both more jobs and above-average incomes, may be contributing to the overperformance of withholding, according to the controller's office.
The only dip in expected revenues came from retail sales tax revenues, which fell 4.1% short of expectations. Chiang said consumers are either not shopping as much as anticipated or are buying goods and services not subject to California's sales tax.
For the fiscal year, which began on July 1, the state's revenues so far total $1.2 billion ahead of projections.
On the spending side, total disbursements were also more than expected during October — by $613 million, or 6.1%. For the fiscal year to date, disbursements are still about $1.1 billion below projections.
Chiang said that to further boost California's credit worthiness on a long-term basis, the state must next tackle the growing $64 billion unfunded liability stemming from providing health benefits to the retired public workforce.
"To not only protect taxpayers, but also the retirement security promised to our firefighters, teachers, and other providers of critical public services, we can no longer deny, delay, or equivocate," Chiang said.
