Here is copy of notice sent to all city halls on the Governor's budget revisions.

Frances Medema
Policy Analyst
League of California Cities
1400 K Street Suite 400
Sacramento, CA 95814
phone: 916/658-8218
fax:       916/658-8240
email:    [EMAIL PROTECTED]

��ࡱ�>��  
-/����,��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������7
  ���bjbjUU   " 
7|7|�������l��������....

:�%2bbbbbbbb�������W
 
wn��bbbbb�v��bb�vvvb
�b�b�vb�v�v<

:,,���bV
`7lCʾ��f.l
X
��0%bR�v��v�������





URGENT FAX TRANSMITTAL -- PLEASE DELIVER IMMEDIATELY

Page 1 of 2

May 15, 2000


TO:     Mayors, Council Members and City Managers

RE:  GOVERNOR RELEASES REVISED MAY 
BUDGET

Today in Sacramento, Governor Davis released his annual revised state budget  
that is based on a reexamination of incoming state revenues. It is released at this 
time of the year to examine, among other revenues, the personal income tax receipts. 

Local Government Package

The highlights for local governments are as follows:

$2.2 
billion over five years for transportation projects and programs financed from the 
sales tax on gasoline, plus a $1.5 billion general fund appropriation for 2000-01 and 
$1.6 billion in future general fund appropriations over the next four years. In the 
transportation proposal there is $400 million designated for local street and road 
maintenance and $100 million for state highway maintenance.

$250 million in one-time 
discretionary funds for local governments (cities and counties). The proposal is to 
split the revenue according to the 1999-2000 formula used to provide $150 million in 
local government relief  � 50 percent on a per capita basis and 50 percent based on 
local governments� contribution to their counties� Educational Revenue Augmentation 
Fund (ERAF).

A host of categorical loan and grant programs for local governments that 
address environmental issues, housing, public safety and economic development. The 
details on these programs have not yet been disclosed.  

It�s the Economy Stupid!

The revised budget recognizes the continued �robust� nature of the California economy. 
Revenues are well above the amounts forecast in January. The report issued today 
estimates a $12.319 billion budget surplus that is divided between a $5.764 billion 
increase in revenues for the current year (1999-00) and a projected $6.555 billion in 
the 2000-01 budget year.

The surge in state revenues is being fueled largely by the 
stock market that is pushing capital gains and stock option income far beyond all 
projections. Capital gains realizations are estimated to have reached almost $84 
billion in 1999. This is an increase from $17 billion just five years ago. Stock 
options doubled in 1999 and reached $51 billion. Together these revenue components 
produce 17 percent of all state general fund revenues!

The state sales and use tax 
revenue forecast has been increased by $648 million for the current year (1999-00). 
Taxable sales grew by 9.3 percent in 1999, the highest rate since 1984. Taxable sales 
in 2000 are expected to grow by 6.9 percent. This mirrors sales tax revenue growth at 
the local level.

The state bank and corporation tax forecast has been increased by 
$563 million in 1999-00 and $564 million in 2000-01, for a combined increased of 
$1.127 billion. Through April, bank and corporation tax revenues are $472 million or 
16.7 percent above the 2000-01 Governor�s Budget forecast. This is the result a strong 
increase in the final payments for the 1999 calendar, which were $145 million above 
forecast.

The Rest of the Story

Among the other highlights of the revised budget 
are:

Education continues to be the Administration�s top priority and this is 
illustrated by an additional investment of $3.992 billion in K-12 education, boosting 
per pupil spending to $6,672 which is an increase of $359.

Tax rebates or one-time 
�prosperity dividends� are given to the taxpayers amounting to $1.9 billion. This will 
translate into a one-time check of $150 for single filers and $300 for joint-filers.

$545 million in tax relief to credentialed teachers by exempting all of their teacher 
earnings from the state personal income tax.

Details to Follow

A briefing with the 
state Department of Finance has been scheduled tomorrow for city representatives in 
Sacramento. The briefing should provide greater background on the proposals in the 
Davis budget. For now, the May Revision of the Budget is a good start, but it needs to 
improve for local governments. The work now lies with the Conference Committee(s) to 
pull together the final 2000-01 state budget and set the exact amount of local 
government fiscal relief. Integral in those deliberations will be the efforts of city 
officials to push the Governor�s office and Legislators for a larger share of the 
state budget surplus.
:�������4Y����
     �     �
�
Vh������������
  
5�>*\�5�\�5�:;GHUVW������������������������������
  ���0�^��`�0�$a$/$$d%d&d'd-D!4M�

N�O�P�Q�a$������
             �     �     �     �     ^_

FG����23
��UVh�����������������������������^�
&Fhi����^�
 1�h��/ 
��=!�"�#��$��%�
i8@��8NormalCJ_HaJmH       sH     tH    
 2@2   Heading 1$@&5�\�6@6     
Heading 2$@& 5�>*\�8@8 Heading 
3$$@&a$5�\�<A@���<Default 
Paragraph Font,B�,     Body 
Text5�\�<C@<Body Text Indent
��^��� 
����:;GHUVW����������������^_
       F
G
����23


�
�
UVhi��0���0���0���0���0���0���0���0���0���0���0��
0��
0���0��0��0��0��0�0��0�f�0�f�0�f�
 0�f�@0�f� 0�f�@0�f� 
0�f�0�f�0�f�@0�f�0�f�0�f�0�f�0�f�0�f�0�f�0���0�f0��0���0���0���
 0���0��� 0���0��� 
0���0���0���0���0����h�
�
����Office 
2000MC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
Document1.asdOffice 
2000!G:\LEGISLTV\DS\mayrevisealert.docOffice
 2000RC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
mayrevisealert.asdOffice 
2000RC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
mayrevisealert.asdOffice 
2000RC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
mayrevisealert.asdOffice 
2000RC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
mayrevisealert.asdOffice 
2000!G:\LEGISLTV\DS\mayrevisealert.docOffice
 2000LC:\WINDOWS\Application 
Data\Microsoft\Word\AutoRecovery save of 
mayrevi1.asdOffice 
2000C:\WINDOWS\TEMP\mayrevi1.docOffice 
2000C:\WINDOWS\Desktop\mayrevi1.docjK�'R@B����������H

�~D�����������h�������^��`���OJQJo(���h�p����p^�p`���OJQJo(o�h�@����@^�@`���OJQJo(���h�����^�`���OJQJo(���h�������^��`���OJQJo(o�h�������^��`���OJQJo(���h�������^��`���OJQJo(���h�P����P^�P`���OJQJo(o�h�
 ���� ^� 
`���OJQJo(��h�������^��`���OJQJo(���h�������^��`���OJQJo(o�h�p����p^�p`���OJQJo(���h�@����@^�@`���OJQJo(���h�����^�`���OJQJo(o�h�������^��`���OJQJo(���h�������^��`���OJQJo(���h�������^��`���OJQJo(o�h�P����P^�P`���OJQJo(��jK�'H
�~������������                             
                                                    
       
:���@�P@��Unknown������������G��:�Times
 New 
Roman5��Symbol3&��:�Arial?5�
       �:�Courier 
New;��Wingdings"����hD|E&D|E&5|E&p�

�������r02�Q���
May 15, 2000Office 2000Office 
2000�������Oh��+'��0��������
     $
@LX
dpx���
May 15, 
2000oay Office 
2000ffiffiNormal.dotOffice 
20003fiMicrosoft Word 
9.0@F�#@VD�Ⱦ�@X�<ʾ�@X�<ʾ�p�
����՜.��+,��0
hp��������
���League of CA Cities�
        
May 15, 2000
Title
   

�������� 
!"#����%&'()*+��������.����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������Root
 Entry��������    
�F(�Cʾ�0�1Table�������������WordDocument��������"
 
SummaryInformation(����DocumentSummaryInformation8������������$CompObj����jObjectPool������������(�Cʾ�(�Cʾ�������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������
���� �FMicrosoft Word Document
MSWordDocWord.Document.8�9�q

Reply via email to