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• Significance: Economic downturns can have significant adverse <br />impact on major General Fund revenues <br />Stronger Economy -2% prop tax, <br />-5% sales tax, <br />over 12 months <br />Moderate Economy -3% prop tax, <br />-7.5% sales tax, <br />over 18 months <br />Weaker Economy -4% prop tax, <br />-10% sales tax, <br />over 24 months <br />Aggregate Reduction in Total California City <br />Revenues from Recent Recessions Compared to <br />"Normalized" Statewide Growth Rate <br />35% 32.8% <br />30% — -- - <br />25% 24.1% <br />20% <br />15% <br />d9.6%10•�5% � 0954.2%5.3% <br />0% - <br />1969-70 1973-74 Early Early 2001-02 2007-09 <br />Vietnam oil/ 1980s oil/ 1990s S&L, Dot.com Great <br />war debt stagflation inflation aerospace, Bust Recession <br />real estate <br />• Equivalent to average impact of Dot.com Bust <br />recession of 2001-02 <br />• Average of two middle -impact recessions of the <br />six since 1960's (Dot.com Bust and early 1980's) <br />• Equivalent to average impact of recession in <br />early 1980's <br />All scenarios assume next recession starts in FY21 and on a 7-year cycle <br />thereafter, with a 3-year recovery period <br />za <br />