The non-partisan “Truth in Accounting” project, which analyzes government financial reports, has awarded California an “F” grade for claiming surpluses instead of a $269.9 billion deficit.
The Chicago-based organization has been providing in-depth accounting reviews of the audited financial statements for America’s fifty states, as well as most major counties and major cities, in the United States since 2002.
The group’s mission is to educate and empower citizens with understandable, reliable, and transparent government financial information.
California received the lowest score of “F” on Truth in Accounting’s grading scale because despite Gov. Jerry Brown touting several years of surpluses, California actually faces a $269.9 billion shortfall in terms of its overall obligations, which equates to $22,000 burden for each of the 12.3 million taxpayers in the state.
California’s financial burden is primarily associated with the rapidly deteriorating condition of the state’s current $461.3 billion in promised public employee retirement benefits –which are $102.5 billion under-funded by the pension plan — and $107 billion for unfunded retiree health care benefits.
The State of California faced a near financial death experience in Great Recession, when the average taxpayer burden jumped from $15,000 to $23,500. Newly elected Gov. Brown, facing a $25 billion deficit in 2011, passed an array of income and sales tax hikes, including a 29 percent increase for Californians with taxable income over $1 million.
Gov. Brown has touted the “California Comeback.” But the data demonstrate that despite the gusher of tax revenue the flooded into Sacramento from the economic recovery and the substantially higher tax rates Gov. Brown passed, the state’s taxpayer burden only fell modestly to $20,900 by 2015. The taxpayer burden rose to $21,600 in 2016 and hit $22,000 in 2017, the second-highest in the history of the state.
Truth in Accounting Founder Sheila Weinberg warns that California is a giant “Sinkhole Sate.” Ms. Weinberg is especially critical of Gov. Brown claiming an $8.8 billion surplus this year, while avoiding the fact that California has only $100.1 billion in available assets to pay $369.9 billion worth of bills.
Weinberg emphasized to Breitbart News that California’s rising “taxpayer burden” is only for net state liabilities. Her organization intends to begin publishing consolidated reports this summer for all the states that will also capture the liabilities of counties and cities. Ms. Weinberg expects that the combined taxpayer burden for California to be a much higher number.