Analysts report that the state of California will have a $31 billion surplus next year.
They say tax revenues have continued to climb despite the pandemic. Intheir annual report released Wednesday, Petek and his analysts found the surplus tax revenues would be counted toward multiple fiscal years. But most of the windfall — more than $22 billion — is paid in taxes collected during the current budget year, which began July 1 and runs through June 30 of next year. Substantial portions of the overall budget bonanza will go toward funding K-12 schools and community colleges. The analysts project guaranteed school funding will have increased by some $11 billion over the period between mid-2020 and next summer, with higher spending required after that.
Lawmakers could comply with the law by reducing taxes, spending more on excluded purposes like infrastructure, issuing tax rebates or providing extra money to schools to schools.
It's not clear what the governor and lawmakers plan to do with the extra money. It will be the fourth year in a row that the state has had a surplus thanks to higher tax collections.