California Would be One of the States to Lose the Most

Cities, Counties, Schools and Realtors Urge Congress to Reject Proposed Cut to Property Tax Deduction

November 13, 2017

The associations representing California’s local governments, economic development leaders, schools and realtors urged the California congressional delegation on November 9 to protect the State and Local Tax (SALT) deduction and a key economic development tool at risk under the Tax Cuts and Jobs Act in its current form.

The SALT deduction makes the cost of living more affordable in states like California. Eliminating the deduction for state and local income taxes and capping the local property tax deduction at $10,000 would hurt hard-working California families and only add to the housing affordability crisis in the state by eliminating a key incentive for homeownership. In 2015, 6.1 million California taxpayers claimed the SALT deduction with the average deduction at around $18,000.

The SALT deduction has been an integral component of the federal tax code since its creation in 1913 and was one of the six deductions allowed under the original tax code...

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NEA President Says Republican Tax Cut is Giveaway to Wealthiest, Would Jeopardize Students’ Education

November 13, 2017

On November 2, Republican leaders in the U.S. House of Representatives unveiled a massive, $5 trillion tax plan that the National Education Association describes as giving huge tax breaks for the wealthiest and corporations, while putting middle-class families at risk of higher taxes. The NEA also criticizes the plan for expanding an education tax loophole that would further benefit the wealthy and allow them to set aside money for private school expenses, while cutting tax deductions for the middle class; and eliminate the educator tax deduction that allows educators to deduct eligible unreimbursed classroom spending up to $250. Congress made this deduction permanent in 2015. According to a recent report, 99.5 percent of educators dip into their own pocketbooks to provide supplies and instructional materials for their students. This tax plan rollout is the first step in a rushed effort to rewrite the tax code and ultimately pave the way for devastating cuts to working families, students and communities...

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Report Documents Increased Pension Costs on Schools, Contributions Set to Triple by 2024

November 13, 2017

A new report shows that school district contributions to pension funds reached a record high in 2017 and are poised to climb even higher, hindering the ability of California school districts to invest in the classroom and provide students with the supports needed to succeed in college, career and civic life.

The California School Boards Association documents the effects of the pension crisis in a report released on November 8, titled The Impact of Pension Cost Increases on California’s Schools. Drawing on data from a 2017 survey of school board members across California, the report found that:

  1. 43 percent of respondents have already cut programs that are included in their Local Control and Accountability Plan (the plan every California school district develops to indicate its goals for students and the actions it will take to achieve them)
  2. 68 percent of those who have not yet cut programs anticipate making cuts and/or engaging in deficit spending in the next two to three years...

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Strong Retail Sales Keep State’s October Revenues Close to Budget Estimates

November 13, 2017

California State Controller Betty T. Yee reported on November 9 that California’s total revenues of $6.74 billion for October were just $38.7 million shy of expectations, even with two of the state’s biggest revenue sources missing the mark. A strong month for retail sales made up for most of the shortfall.

For the first four months of the 2017-18 fiscal year, total revenues of $32.65 billion are outpacing budget projections by $544.8 million, or 1.7 percent, with all of the “big three” – personal income, retail sales and use, and corporation taxes – in the black.

Sales tax receipts of $936.1 million for October were $45.0 million higher than anticipated in the budget. For the fiscal year, sales tax receipts of $6.86 billion are $195.3 million above budget estimates...

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NSBA Calls Trump Plan to Eliminate State/Local Tax Deduction “Assault on Local Governance in Education”

October 30, 2017

On October 26, National School Boards Association Executive Director & CEO Thomas J. Gentzel today released the following statement in response to congressional action related to President Trump’s proposed tax reform, which includes the elimination of the State and Local Tax (SALT) Deduction:

"The elimination of the state and local tax (SALT) deduction is an assault on local governance in education. State and local tax revenues are essential to support school infrastructure, teachers, curriculum, transportation, and other resources that ensure children’s success in college and career, as well as long-term economic stability in our communities.

NSBA opposes any efforts to weaken our country’s public schools or that infringe on the ability to provide students with a high-quality education. For schools and communities to thrive, they require investments of resources and commitment, not reductions, which is precisely what will occur if the SALT deduction is eliminated...

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Torlakson Assures Schools Closed by Hazardous Air Quality that State Funding Will Continue

October 16, 2017

State law allows schools to apply to receive state Average Daily Attendance (ADA) funding, the main source of school funding, if they have to close because of a natural disaster such as floods, fires, or earthquakes.

On October 12, State Superintendent of Public Instruction Tom Torlakson announced that schools closed because of dangerous air quality can also apply to receive state Average Daily Attendance (ADA) funding, and that they will be assisted by administrators from the California Department of Education (CDE).

Nearly 600 schools with about 260,000 students statewide were closed on October 12 because of fire danger, dangerous air quality, and evacuations...

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CDE Requires CAVA to Pay Nearly $2 Million to State

October 16, 2017

State Superintendent of Public Instruction Tom Torlakson announced on October 9 that the California Virtual Academies and three Insight Schools (together CAVA) must remit nearly $2 million to the California Department of Education (CDE) in improperly used Common Core education funds.

This and several other actions required by the CDE stem directly from an audit conducted by the State Controller’s Office and commissioned by the CDE. The audit, which covered July 1, 2014, to June 30, 2016, was released today and is available on the California State Controller’s Special Reports Web page.

“The California Department of Education is committed to ensuring public schools follow the laws and regulations that safeguard taxpayer funds. It’s critical that our students receive all the resources they need to succeed,” Torlakson said...

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Controller Reports State Revenue Outpacing Expectations

October 16, 2017

On October 10, State Controller Betty T. Yee reported the state brought in $10.92 billion in September, exceeding revenue projections in the state budget by $50.9 million, or 0.5 percent.

Total revenues of $25.92 billion for the fiscal year to date are $583.4 million, or 2.3 percent higher than projections in the state budget enacted in June with all of the “big three” tax revenue sources beating expectations. Revenues for the first quarter of the 2017-18 fiscal year were $1.36 billion higher than one year ago.

Personal income tax (PIT) receipts of $7.62 billion in September were $3.3 million higher than 2017-18 Budget Act estimates. For the current fiscal year, California collected total PIT receipts of $17.58 billion, $216.2 million more than anticipated in the 2017-18 Budget Act...

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Controller Reports State’s Three Major Taxes Running Higher Than Budget Projections

September 18, 2017

State Controller Betty T. Yee reported on September 12 that the state brought in $8.90 billion in August, exceeding projections in the state budget by $343.7 million, or 4.0 percent.

After July revenues exceeded expectations, the positive August numbers put total fiscal year-to-date revenues at $14.99 billion, $532.5 million higher than projections in the state budget enacted in June. Revenues for the first two months of the fiscal year were $1.01 billion higher than they were one year ago.

Led by personal income taxes (PIT), each of the “big three” revenue sources beat expectations. PIT receipts of $5.22 billion in August were $135.7 million higher than 2017-18 Budget Act estimates. For the current fiscal year, California collected total PIT receipts of $9.96 billion, $212.9 million more than anticipated in the 2017-18 Budget Act...

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Controller Reports Encouraging July Revenues

August 21, 2017

California started the 2017-18 fiscal year with encouraging revenues, State Controller Betty T. Yee reported on August 10, with total revenues of $6.09 billion in July exceeding projections in the state budget approved in June by $188.8 million, or 3.2 percent.

Total revenues in July 2017 were $667.9 million higher than in July 2016. In July, each of the “big three” revenue sources beat expectations.

Personal income tax receipts of $4.74 billion in July were $77.3 million higher than 2017-18 Budget Act estimates. July corporation tax receipts of $363.5 million were $18.9 million more than anticipated in the budget, or 5.5 percent. Retail sales and use tax receipts of $899.5 million for July surged $84.6 million, or 10.4 percent, above budget estimates...

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