DOF Issues April 2022 Finance Bulletin, LAO Provides an Interim Update on Budget Surplus
This week, the California Department of Finance (DOF) issued its April 2022 Finance Bulletin, detailing the latest economic conditions of the state. Of note, DOF indicates that while Cash receipts for the month of March 2022 were $199 million below the forecast of $21.047 billion, preliminary General Fund agency cash receipts for the first nine months of the 2021-22 fiscal year were $17.35 billion above the 2022-23 Governor’s Budget forecast of $138.348 billion. Actual revenues received year-to-date total $155.698 billion, representing a 12.5 percent increase over the projected amount. The full DOF April Finance Bulletin is available here.
Relatedly, the California Legislative Analyst’s Office issued an interim update to its formal 2021-22 Revenue Outlook. According to estimates, the LAO is “virtually certain” that collections from the state’s personal income, sales, and corporation taxes will significantly exceed the Governor’s Budget assumption of $185 billion in 2021-22. Currently, the LAO’s best estimate is that there will be somewhere between $33 billion and $39 billion in unanticipated revenue.
The implications of unanticipated revenues, however, are not straightforward. The LAO anticipates the Legislature will face additional, significant constraints imposed by the State Appropriations Limit (or Gann Limit). Additional information from the LAO is available here.