California Budget To Get Huge Windfall From Facebook IPO
Tuesday, May 15, 2012
Mark Zuckerberg stands to make billions of dollars this week as Facebook goes public. But he’s not alone. As Ben Adler reports from Sacramento, the state of California expects to make billions off Facebook’s initial public offering too.
California desperately needs some good budget news. And that’s where Facebook comes in.
“It’s a really big deal," said Jason Sisney who is with the non-partisan Legislative Analyst’s Office. “Because with the IPO, there will be a series of financial transactions – beginning Friday – that will generate a lot of taxable income for a few thousand Californians.”
Particularly Mark Zuckerberg, who by one estimate could pay hundreds of millions of dollars in state taxes himself.
“It will not be a panacea – the state’s budget problems are much bigger than this amount of money. But it’s a real help and it is a bright spot in the state’s economy," said Sisney.
Sisney is projecting a one-time windfall of about two billion dollars, roughly two percent of the state budget. But he says the state could net a few hundred million less, or a billion or two more.