Day 10: Fiscal Year 2009-2010

SACRAMENTO

3:42 PM, Pacific Standard Time

No deal between the governor and the Legislature on closing the estimated $26 billion hole in the budget for the fiscal year that began July 1.

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Legislative leaders met privately with Gov. Arnold Schwarzenegger to discuss the budget.

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The Legislature was adjourned until Monday July 13.

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Gov. Arnold Schwarzenegger returned home to Los Angeles after meeting with legislative leaders.

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State Controller John Chiang issued his report on California’s cash balance, receipts and disbursements for the fiscal year that ended June 30.

The State started the fiscal year with a $1.45 billion cash deficit, which grew to $11.9 billion on June 30, 2009. Borrowed money from special funds provided enough cash to fund state operations through June 30.

On July 1, however, Chiang began issuing IOUs to pay a little more than 25 percent of the state’s bills. Use if the IOUs should see the state’s cash flow sufficient to make required payments to schools, state workers and debt through September.

For the final month of the fiscal year, personal income taxes nearly $1 billion below estimates used in governor’s May budget revision. Sales taxes were short by $154 million. Corporate taxes were $1.31 billion above estimates as corporate taxpayers paid early to avoid a new underpayment penalty. Year-to-date combined tax collections are nearly $700 million below the May Revision’s estimates. 

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