Gov. Jerry Brown counting on estate-tax funds that may never come
Every California budget is based on expectations about taxes and spending that may or may not pan out. In the budget Gov. Jerry Brown signed last week, the biggest risk is that voters won't approve higher taxes in November.
But there are others too. He's also counting on Congress to reverse years of estate-tax policy, allowing California to collect revenue it hasn't seen since 2004.
The Brown administration is expecting only a small amount of revenue, $45 million, from the federal estate tax in the fiscal year that began Sunday. By the 2015-16 fiscal year, the administration is expecting $1.2 billion.
That assumption has helped Brown and Democratic lawmakers insist that California will emerge from its financial turmoil with a budget surplus three years from now.
H.D. Palmer, a spokesman for Brown's Department of Finance, the administration included the estate-tax money because the existing federal policy is set to expire at the end of the year.
However, the nonpartisan Legislative Analyst's Office warned in a report last fall that it's unlikely Congress will allow that to happen.
— Chris Megerian in Sacramento
Photo: Opened and discarded envelopes after Californians mailed in their tax returns in April, when state revenue fell short of projections. Credit: Laura Morton / For The Times