April 12, 2006

State General Revenues Continue to Outpace Estimates

Today the California Department of Finance released their April Finance Bulletin that reflects March economic activity and state revenues.  Once again the report includes good news for state revenues. The report estimates that, since January, state General Fund revenues are slightly more than $1 billion greater than estimated in the Governor’s Budget released in January.

This increase is positive but the really important revenue numbers will be after the April 15th tax date for tax payments and refunds.

The March data showed continuing strength in personal income tax revenue, corporate tax revenue and sales tax revenue. If the trend continues, the May Revision should identify from $3 billion to $5 billion in additional revenue for the combined 2005-06 and 2006-07 fiscal years. Slowing in the housing market and construction, however, could result in a dampening of the revenue expectations.

We will update with May Revision information as soon as it is available.