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Governor Brown Announces New Rainy Day Fund

 
Posted May 8th, 2014 @ 6:58pm by KFBK News - Mike Simpson

State lawmakers have reached a deal on a new rainy day fund.

Governor Jerry Brown says lawmakers from both sides of the aisle have come together on a plan that will ensure we're prepared for future downturns while tackling debt at the same time.

Changes have been made to an original proposal to appease Republicans, their votes are needed now that Democrats have lost their senate super majority.

The account would be funded by siphoning off capital gains revenue that spikes above 8 percent and through automatic deposits of 1.5 percent of general fund money.

Half of what's deposited would put toward paying down long term costs.

News of the rainy day fund comes at the same time as word that California tax receipts are $2 billion above expectations.

The State Controller's office says last month's revenues were $300 million higher than what the Brown administration had projected in January.

Income tax collections totaled $82.9 million and corporate taxes surged to $179 million, beating projections by 12 percent.

The governor will revise his budget proposal during further negotiations with lawmakers this month.

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