Week in review Golden State racks up bigger surplus

California will have a $31 billion budget surplus next year as revenues continue to climb despite the pandemic, according to a new forecast from the state's independent Legislative Analyst's Office.

The predicted surplus is so large the office estimates California will surge past a constitutional limit on state spending by more than $14 billion. That could require Gov. Gavin Newsom and state lawmakers to either cut taxes, spend more money on schools and infrastructure or - perhaps the more popular choice in an election year - give rebates to taxpayers.

California's tax collections have continued to soar despite the pandemic. From April through June of this year, California businesses reported a record high $216.8 billion in taxable sales - a 38.8% increase over the same period in 2020 and a 17.4% increase over those months in pre-pandemic 2019. Nick Maduros, director of the California Department of Tax and Fee Administration, said it is "a sign that business owners found creative ways to adapt during a difficult year."

The state's fiscal year runs from July 1 to June 30. During the first three months of this budget year, California tax collections are more than $10 billion ahead of projections. The LAO predicts that by June, California will have collected $28 billion more in taxes and transfers than it had expected.

That means there likely will be a significant increase in spending on public schools. The state Constitution requires lawmakers to spend about 40% of state tax collections on public education each year. The LAO said Wednesday that means public schools and community colleges could see an $11 billion increase.

All of this is possible because of a historic surge in tax collections. In September, collections from taxes on income, sales and corporations were 40% higher than September of last year and almost 60% higher than September 2019. That's because retail sales have had double-digit growth this year and stock prices have doubled from their low point last spring at the start of the pandemic.

California jobless claims jump

California workers filed more initial claims for unemployment last week compared with the week before as the state continues to struggle in its pandemic recovery.

Workers statewide filed 61,464 first-time jobless claims during the week that ended Nov. 13, an increase of 6,431 from the 55,033 claims that were filed in the week ending Nov. 6, the U.S. Labor Department reported Thursday.

The increase in unemployment claims in California ended three consecutive weeks of decreases.

Nationwide, workers filed 268,000 initial jobless claims last week, a decrease of 1,000 from 269,000 that were filed the week before, the Labor Department reported. These numbers are adjusted for seasonal volatility.

CVS will close hundreds of stores

CVS Health will close hundreds of drugstores over the next three years, as the health care giant adjusts to changing customer needs and converts to new store formats.

The company said Thursday that it will close about 300 stores a year for the next three years, nearly a tenth of its roughly 10,000 retail locations as it reduces store count density in some places.

CVS Health said it has been evaluating population changes, customer buying patterns and future health needs to "ensure it has the right kinds of stores in the right locations."

The company also has been expanding the health care services it provides at many locations.

The closings make sense as CVS Health seeks to remake many stores into more of a "one-stop shop" for care, Edward Jones analyst Ashtyn Evans said, adding that the company's Aetna health insurance business should steer customers to those stores.

The company released no details Thursday on where the closings will occur. It did say they would start next spring.