Budget & Taxation
Blue Sky Consulting Group has done extensive work on budget and taxation issues. Our budget work ranges from investigating the effect of budget cuts on service providers, recipients, and departments to forecasting budget needs and debt burdens. Blue Sky Consulting Group's work on tax issues is just as diverse, ranging from estimating local property tax changes from housing developments or casino expansions to implementing a green manufacturing equipment tax exemption program. Often, projects involve both budget and taxation expertise as we estimate the impact of changes in tax revenue and service use for public budgets.
The City of Los Angeles Office of Economic Analysis (OEA) sought assistance in addressing one of the most important questions facing any governmental entity: to what extent will a change in tax policy result in increases in economic activity? Working closely with the OEA, we utilized an econometric model of the city’s multi-billion dollar economy to estimate the likely fiscal and economic implications of phasing out the city’s gross receipts tax.
In 2009 and 2010, Blue Sky co-founder Tim Gage served as fiscal adviser to California Forward, which sought expertise on how to reform California's budget process. The effort included analyzing various proposals to mitigate the impact of volatile state revenues on budget planning. With this assistance, California Forward created a 6-point platform for fiscal reform. This effort was just one of numerous fiscal advisory projects undertaken by the Blue Sky Consulting Group, which range from delineating higher education funding challenges to modeling changes to the state's "rainy-day" fund mechanisms.
An Examination of California's Debt Burden
The sorry state of California's infrastructure is a common refrain, but how much additional infrastructure investment can the state afford? In order to address this question, we examined California's ability to take on additional debt to fund infrastructure projects, constructing a simulation and forecasting model to project debt service payments and state General Fund costs and revenues under a variety of scenarios. This interactive simulation tool allowed our client to project the effects of various interest rate assumptions, program caseload and cost increase scenarios, and new debt approval schedules. The resulting insights were used to guide strategic decision-making with respect to new infrastructure initiatives.
Long-Term Budget Planning for the University of California
The Blue Sky Consulting Group developed a long-term business planning model for the Board of Regents and Office of the President of the University of California, which sought to improve the ability of the system's leaders to manage the organization's $20 billion annual budget. The model can adapt over time as enrollment, state budget, and cost structures change, making it more than just a one-time planning solution.