CA - Brown pushes 42% gas tax increase to pay for state pension fund

[Anti Federalist]

Jerry Brown Wants 42% Gas Tax Hike to Bail Out CalPERS

http://www.breitbart.com/california/...ilout-calpers/

Despite tax collection increasing by 50 percent in the last 9 years, California’s public pension insolvency is forcing Gov. Jerry Brown to propose a dangerously unpopular 42 percent increase in gasoline taxes and a 141 percent increase in vehicle registration fees.

Breitbart News reported on January 9 that Gov. Brown announced that for the first time since 2012, California’s $122.8 billion General Fund Budget is in deficit by $1.6 billion. Despite a near bankruptcy during the financial crisis, California’s tax revenues have increased by about $43 billion in the last 9 years. Brown on Monday only suggested relatively painless spending reductions to close the budget gap. He was very careful to not suggest highly controversial increases in gasoline tax or vehicle fees.

Democrat governors have been regularly spiking gas taxes and vehicle registration fees for decades. But 12 years ago, Democrat Gov. Gray Davis was recalled by voters after he pushed the state legislature to pass a vehicle registration fee increase from $46 to $158.

The legislature cancelled the increase and Democrats have avoided gas and vehicle increases since. When the Assembly tried to revive a gasoline tax last year, the issue was dropped after polls showed 63 percent voter opposed any increase.

Republican governor Arnold Schwarzenegger destroyed his popularity by pushing through the Proposition 1-A high-speed rail initiative in 2008 that added about 11 cents a gallon to the price of gasoline — for a project now referred to by Bloomberg News as a “fiasco.”

Gov. Brown’s willingness to try raising gasoline taxes by 17 cents a gallon, and on vehicle registration fees by $65, is a sign of the insolvency risk from the exploding cost of California Public Employees’ Retirement System (CalPERS) public pensions. Brown’s draft 2017-2018 budget already includes a $524 million increase for the public pension contribution. That amounts to an 11 percent increase over this year’s $5.3 billion cost.

The CalPERS contribution increase would have actually been another $516 million more next year, but the world’s biggest pubic pension is allowing the State of California to “smooth” the higher pension funding cost by reducing its projected investment return expectation from 7.5 percent to 7 percent. But that smoothing will lock California into about a $524 million CalPERS contribution increase for each of the next four years.

Breitbart News reported in December that Stanford University’s “U.S. Pension Tracker” calculated that if CalPERS used the 2.75 percent interest rate on 20-year U.S. Treasury bonds as a “conservative” expected investment rate of return, the state would have a $964.4 billion unfunded actuarial public pension debt, or about $92,748 per household.

But under this conservative scenario, California would be required to start contributing an extra $3 billion to CalPERS immediately. Given that CalPERS only earned a 2.4 percent investment return in 2015, and just 0.61 percent last year, the 2.75 percent expected investment return may actually not be that conservative.

Gov. Brown has little flexibility to raise taxes to fund CalPERS, because “Taxifornia” already has the highest personal tax rate of 13.3 percent and its sixth highest corporate rate of 8.84 percent. According to a study by the Pacific Research Institute, the brutally high tax burden has been the cause California’s abnormally slow growth, its net exporting of U.S. citizens and its shrinking labor force for over a decade.

[Brian4Liberty]

They promised the moon to public employees, and now they are paying the price. If this was a public company, it would have eliminated or radically reduced the pension plan, or gone out of business.

[Anti Federalist]

They promised the moon to public employees, and now they are paying the price. If this was a public company, it would have eliminated or radically reduced the pension plan, or gone out of business.

But it's not.

It's government.

So they'll just put a gun to your head and force you to pay.

[Zippyjuan]

The 17 cents a gallon proposed gas increase would go to the general budget- not just CALPERs. The gas tax mostly goes towards transportation. http://news.nationalgeographic.com/2...killer-whales/

Another attempt at a new vehicle fee and gas taxes for road repairs and transit

Negotiations at the state Capitol over the past two years have failed to produce a plan to produce needed new dollars for transportation. The governor’s budget offers a new plan to lawmakers, estimated to add $4.3 billion a year for the next decade to cover roadway repairs, and new efforts at expanding public transit.

How does he propose to pay for it? The largest source of money would be a new $65 annual fee on all vehicles. The rest would come from a steadily growing excise tax on gas and diesel, money from the state’s auction of greenhouse gas pollution credits, and new efficiencies at Caltrans.

California’s rainy-day fund would grow to $7.9 billion

The governor proposes stashing away just about the exact amount of cash required by a 2014 voter-approved mandate, adding $1.15 billion in the fiscal year that begins this summer. While that would be enough to cushion the blow to state services in a mild recession, it’s only about one-fifth of the money that went missing during the depth of the 2008-09 recession.

Public employee pension costs are going up

The proposed spending plan assumes more taxpayer money to help pay the retirement promises made to state government workers. That includes $5.3 billion in payments to the California Public Employees’ Retirement System — mandated after the agency lowered its investment profit assumptions — and $2.8 billion in payments to the California State Teachers’ Retirement Fund.

[oyarde]

I think Caly should raise the gas tax by 100 percent . Go big .

[Zippyjuan]

Gas Taxes by State: (this is a year ago- some may have been raised since):



http://taxfoundation.org/blog/state-...tax-rates-2016

[Zippyjuan]

By country (US rates are just the Federal gas tax- not including state gasoline taxes- which is $0.184 per gallon):

[Cleaner44]

But it's not.

It's government.

So they'll just put a gun to your head and force you to pay.

Not to my head... to the head of the moronic California voters that keep endorsing this insanity.

CA did this to themselves.

[seapilot]

I think Caly should raise the gas tax by 100 percent . Go big .

That is not big try 1000%. Let get this show goin!

Calexit will then be all the people filling their tanks one last time before moving to another state.

[Zippyjuan]

Folks from Mexico have been coming across just to fill up. http://fortune.com/2017/01/12/driver...alifornia-gas/

Drivers Are Crossing the Border from Mexico to Buy Gas in California

For drivers below the Mexican border, the gas is too expensive — and many are crossing the border for lower prices.

Protestors of Mexico's “gasolinazo,” a 20% hike in fuel prices the government enacted to open the market up to foreign businesses, have blocked gas distribution centers in the Mexican state of Baja, Calif., Bloomberg reports. This prevents stations from refilling. And as a result, Bloomberg reports a steady flow of vehicles has been waiting in 4-5 hours of traffic to cross the border into the U.S. and fill up their gas tanks.

“Right now, it’s crazy,” Rodrigo Marquez, an employee at a Shell station five blocks from the border in Calexico, Calif., told Bloomberg. “We are having a lot, lot of people, everybody is fueling up their tanks.”

After people fill up their tanks in the U.S., they head back to the border to wait another 2 hours. In areas where people are able to buy gas, people are paying around $2.815 per gallon right now in Mexico—roughly 10 cents higher per gallon than in California.

But let me get this straight. According to the article, people are spending hours crossing the border and waiting to save ten cents a gallon? If you have a 20 gallon tank, that is $2.00 (I guess average tank size is 12 gallons- so $1.20). They are spending more than that burning gas to cross the border. A lot of work and time wasted for a little bit of money. (part is also that some station in Mexico have been running out so they can't find gas at any price in some areas)

TIME says difference is sixty cents. About $7.20 for a twelve gallon fill-up. Still maybe not worth the hassle.

http://time.com/money/4633109/mexico...tations-cheap/

Mexican nationals explained to one TV station in Texas that they'll save 60¢ per gallon by fueling up in Brownsville, Texas, rather than across the border in their hometown of Matamoros, Mexico. Some drivers said that the fuel is higher quality in the U.S. too, and that they're tired of the long waits—sometimes an hour or more—typical at gas stations in Mexico lately.

[oyarde]

Folks from Mexico have been coming across just to fill up. http://fortune.com/2017/01/12/driver...alifornia-gas/



But let me get this straight. According to the article, people are spending hours crossing the border and waiting to save ten cents a gallon? If you have a 20 gallon tank, that is $2.00 (I guess average tank size is 12 gallons- so $1.20). They are spending more than that burning gas to cross the border. A lot of work and time wasted for a little bit of money. (part is also that some station in Mexico have been running out so they can't find gas at any price in some areas)

TIME says difference is sixty cents. About $7.20 for a twelve gallon fill-up. Still maybe not worth the hassle.

http://time.com/money/4633109/mexico...tations-cheap/

They are delivering something else if they claim to be doing that for 7 FRN's .

[Anti Federalist]

So, I can safely assume Zippy is fine with this and will happily pay 42% more for fuel.

[Keith and stuff]

This is great news for out-of-state small business owners. It should be named the OR-NV-AZ Small Business Promotion Bill.

[Zippyjuan]

So, I can safely assume Zippy is fine with this and will happily pay 42% more for fuel.

42% increase in the state gas tax- not in the price of gas. Price increase would be $0.17 a gallon which at $2.50 a gallon would be about seven percent higher. I haven't said if it is a good thing or a bad thing.

[bunklocoempire]

Just a little bit of slavery. And then a little more slavery. And then a little more.

Slavery is apparently a tough bugga to manage.

[timosman]

Just a little bit of slavery. And then a little more slavery. And then a little more.

Slavery is apparently a tough bugga to manage.

Just a tip, just a tip.

[Keith and stuff]

42% increase in the state gas tax- not in the price of gas. Price increase would be $0.17 a gallon which at $2.50 a gallon would be about seven percent higher. I haven't said if it is a good thing or a bad thing.

It is definitely a good thing, a very good thing - for the small businesses located near the California state border in OR, NV, and AZ

[AngryCanadian]

Liberals love taxes and this just further proves it.

[mrsat_98]

Liberals love taxes and this just further proves it.

Shut up and pay your fair share comrade.

[AngryCanadian]

Shut up and pay your fair share comrade.

I pay, but to much is to much.

[mrsat_98]

I pay, but to much is to much.

Would you like some cheese with that whine ?

[AngryCanadian]

Would you like some cheese with that whine ?

Would you rather prefer some Carbon with that order?

[Cleaner44]

42% increase in the state gas tax- not in the price of gas. Price increase would be $0.17 a gallon which at $2.50 a gallon would be about seven percent higher. I haven't said if it is a good thing or a bad thing.

Of course you haven't said if it is a good thing or a bad thing, there is no need to state the obvious. Any time money can be taken from the people and given to the government it is a good thing... right? Clearly it is a tiny sacrifice for the individual cog, while machine becomes more powerful and benevolent. Is there ever a time that giving more money to the government is a bad thing?

[oyarde]

Californians are rich ,17 cents is chump change , they can pay more .Californian representatives are cowardly . All Caly gas tax increases should be in dollar increments .

[Chomp]

What we Californians can expect in our commie nanny corn hall ? Old dusty mummy Jerry Brown voted by CA legislature who are Libtards to enable their crap with his dusty inks pen.

[timosman]

What will happen in Cali when the techno bubble is over and the military contracts are no longer coming?

[oyarde]

What will happen in Cali when the techno bubble is over and the military contracts are no longer coming?

May be a little hard to support the 20 percent of LA County on welfare then . Best just get the CalExit out of the way now . Spare the children in the Heartland the site of the california apoCALypse when the liberals are running around looting and eating one another ......

[jllundqu]

Support #CalExit Send em packing and wish them luck in their utopian endeavors.

In all seriousness.... I'm surprised it's not talked about much. Perhaps, like entitlements, it is the 'third rail' so to speak. Future outlays for state and city pensions are nearly ALL in the RED. Federal employees, too.... although they rely on funny money and accounting tricks to hide the real numbers.

What will happen when the worker comes to collect what was promised to him and the GOV hands them an IOU?

Happy fun times!

[Chomp]

Californication is going to become another Detroit. Detroit became citywide, California is going to be statewide. The American Garden of Edom is turning into the graveyard of horrors. That's no kidding. I live in this state.

[Anti Federalist]

42% increase in the state gas tax- not in the price of gas. Price increase would be $0.17 a gallon which at $2.50 a gallon would be about seven percent higher. I haven't said if it is a good thing or a bad thing.

Quite right, thanks for the correction.

So, are you in favor or not?