California State Controller: Revenue and Spending Tracking Budget, Warns on impact from Shutdown

From California State Controller: Bottom Line: What the Numbers Mean

State coffers welcomed a jump in revenues in September that offset shortfalls in the prior two months. With spending holding in line with estimates, California ended the first quarter of its fiscal year on track with estimates contained in the 2013-14 Budget Act.

September saw total revenues move past expectations by $427 million, or 5.3%. Personal income taxes, which are California’s dominant revenue source, lurched past monthly projections by 9.5%. ... Retail sales tax receipts also beat budget estimates by close to double digits in September, as California consumers resumed shopping with the support of more jobs, higher home prices, and a rising stock market.
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California has completed the first leg of the fiscal year with a good pace. Both revenues and state spending have stayed close within their designated lanes, almost exactly matching estimates contained in the 2013-14 Budget Act. Revenue collections could be challenged in the coming months by any negative developments related to jobs, interest rates, stock prices, and home values. Spending will be impacted by demands for education, health care, social services, and other line items. Decisions or a stalemate in Washington related to defense outlays, research funds, Medicare, and other federal programs could ripple back to California in major ways.
emphasis added

The 4+ year drag from the cutbacks at the state and local governments levels are mostly over.  However the Federal government shutdown could start negatively impacting state budgets soon.  Just as the states are starting to recover ... the House pulls the football away.