The state budget, signed last week by Gov. Jerry Brown, was crafted with a number of high-stakes assumptions, the L.A. Times points out today.
The future of wealth inheritance and estate tax in the country, for example, seems destined to cause a ripple that will either flood California shores with revenue, or drag the state through the sand of fiscal drought a while longer.
The accuracy of Brown's crystal ball will be tested, and the potential consequences of potential forecast fails will play out in the uncertain future (AKA: Reply hazy).
The Times reports that the Governor partially built the budget on the following big bets:
- That current policy on federal estate tax will change.
- That voters will approve $8 billion in higher taxes in November.
- That Facebook will generate $1.9 billion in tax receipts.
- That defunct redevelopment agencies will provide $900 million more than is currently being anticipated.
Regarding the expectation of the estate tax, the Brown administration calculates a slow start with approximately $45 million the first year, says the Times. By fiscal year 2015-16, they foresee that number growing to around $1.2 billion.
Full Revised Budget Detail: California Governor's Budget 2012-13