One of the first registered warrants is seen after printing at the Controller's office in Sacramento, Calif., Thursday, July 2, 2009. The reason for the IOUs is California's $26.3 billion deficit. Lawmakers have not been able to agree on a balanced budget by cutting spending, raising taxes or both. (AP Photo/Rich Pedroncelli)
Today is the constitutional deadline for the California legislature to pass a state budget. And they're about to pass one. (Laughter). Thank you very much. I'll be here all week.
Since it's not clear when the legislature and governor might get together on a budget (Schwarzenegger is pledging to hold out until he gets pension reform, so Thanksgiving would be a good bet), the real question is: when the state might run out of cash again?
The good news here is that, according to the June bulletin from the California Department of Finance, personal income and corporation income tax revenues are coming in above projections. (Unsurprisingly to anyone who lives in the state and sees all the empty retail space, sales tax revenues were below projections). The mostly better-than-expected tax numbers are not enough to make balancing the state's broken budge any easier. But there appears to be enough cash for the state to be able to pay its bills through summer. We won't know that for sure until next month, when we'll see what tax revenues came in this month.