STATE AND LOCAL FINANCE: A QUIZ
True or False? Personal income tax accounts for half of the money raised by the state.
True or False? A regressive tax affects low-income families more than those with higher incomes.
True or False? CalWORKs (California Work Opportunity and Responsibility to Kids) payments are about 25 percent of the state budget.
True or False? The Home Mortgage Interest Deduction is a tax subsidy.
True or False? The state shares the cost of child welfare programs equally with counties.
True or False? Kindergarten-12 education funding from the state grows every year.
True or False? If California mandates a program, it pays for it.
True or False? Fees for services have traditionally been a way for local government to raise revenue.
True or False? Revenue the state can spend comes from bonds, federal aid, and state taxes and fees.
The three most important services for state and local budgets to finance are:
(a)______________________ (b)______________________ (c)______________________
ANSWERS:
False. Sales tax, fees, bank and corporation taxes and others account for about 60% of the total budget.
True. When everyone pays the same percentage or dollar amount in taxes, it widens the gap between high and low-income earners.
False. Less than 10% of the budget goes to CalWORKs.
True. This tax deduction costs the state about $3 billion each year.
False. The state pays about 70% of the non-federal dollars for child welfare services.
True and False! The dollar amount grows due to enrollment growth, but the dollar per student amount may decrease in some years.
False.
True. However, fees are becoming an ever-increasing way to fund programs.
True. Federal aid is about 30% of the budget, bond sales about 5% and state taxes and fees account for the rest of the state budget.
It's tough to list just three things, isn't it? The governor and legislature have the same problem: there are many needs but a limited amount of money.
