California Gov. Jerry Brown is really betting big time that Facebook’s initial public offering takes off.

That’s because state analysts recently announced that they estimate Facebook’s estimated $5 billion IPO could bring California $2 billion of additional personal income tax revenues in the next 18 months, and a total of more than $2.4 billion in the next five years.

And that’s why Moody’s Investors Service now says this “added revenue is credit positive for the state because it will help close a $9 billion budget gap for fiscal year 2012-13,” under the budget proposal released by Governor Jerry Brown in January.

Meaning, Moody’s may hold off on any further credit downgrades of the state’s battered balance sheet.

But did Moody’s get this right, that Facebook is riding to California’s rescue? Because of higher tax revenues in a tax slaphappy state?

Even California has already said capital gains revenue is notoriously volatile and unreliable, because wealth is created and easily destroyed in recessions and stock market downturns. Also, all those Facebook stockholders may sit on their stock for awhile and not cash out—unless Facebook pays their taxes for them, which it might do.

Facebook has said it plans to pay taxes on its employees' restricted stock units, or RSUs, when they vest six months after the company's initial public offering, Reuters reports.

In February 2011, Facebook set up a $1.5 billion credit agreement with affiliates of Morgan Stanley (MS) , JPMorgan (JPM), Goldman Sachs (GS), Bank of America's (BAC) Merrill Lynch and Barclays Capital (BCS), the leading underwriters of the company's IPO. In September 2011, the borrowing capacity was increased to $2.5 billion, Reuters said.

Moody’s says: “It is hard to imagine one company being able to have a real effect on the revenue of a state as large as California, which collects over $86 billion in taxes per year, but California’s tax structure is heavily reliant on the personal income tax.”

Moody’s adds that California’s “tax structure is also highly progressive, which means the state relies heavily on its wealthiest taxpayers and gets a high percentage of its personal income tax revenue from capital gains.”

In fact, California ranks number one out of all 50 states in the amount of revenue it gets from the personal income tax.

In its last fiscal year, in 2010, California got more than half of its state revenue from personal income taxes, 51.5%.

That compares to 39.4% for the other 49 states.

The state’s Analyst's Office has said that, already “the top 1% of PIT  [personal income tax] filers pay around 40% of state income taxes, the General Fund’s dominant funding source.

“In 2009, taxpayers with adjusted gross income of more than $200,000 made up only 3.8% of the total number of tax returns filed that year, but accounted for 54.6% of total personal income tax liability in 2009,” Moody’s says.

California figures that for every buck of capital gains revenue, the state reaps 9 cents in personal income taxes.

That’s why the tech and dotcom bubble saw a boom year in state revenues, Moody’s notes. When those bubbles burst, so did California’s spending war chest.

So now, California is hoping the Facebook IPO will “bring the state $2 billion in personal income tax revenue by the end of fiscal year 2012-13,” Moody’s notes. 

But Moody’s has a warning for California: “Because capital gains revenues are volatile and difficult to forecast, there is no guarantee that the state will receive the amount” it estimates, Moody’s warns, adding, “the state could receive much less, or much more.”

And that’s exactly what California’s Legislative Analyst's Office has already warned, that the tax hikes Gov. Brown wants on top earners may fall short of what he thinks he can get, because their income is extremely volatile. Even California, a tax and spend state, knows the fallacy of “tax the rich” doesn’t work.

Gov. Brown wants to push higher the rates on individuals earning between $250,000 and $300,000 to 10.3% from 9.3% and to 10.8% for those earning up to $500,000. Anyone making above $500,000 would pay 11.3%.

(For more, click on this link: http://www.lao.ca.gov/reports/2012/bud/budget_overview/budget-overview-011112.pdf).

But since Gov. Brown’s revenue is built on getting the upper brackets to pay more, California “would become more dependent on this uncertain revenue source,” state analysts note.

It also adds that, “for this reason, revenue estimates are an even bigger question mark than usual for the Legislature this year. As we have learned in past years, differing fortunes for upper income taxpayers can quickly create or eliminate billions of dollars of projected state revenues. If our current revenue estimates are closer to the target than the administration’s, the Legislature will have to pursue billions of dollars more in budget balancing solutions."

In fact, the California state analysts already estimate that capital gains revenue in 2012 will come in at only just around a third versus what the governor projects from the governor’s new “tax the rich” moves, and that his proposed tax on the top bracket would raise about $2 billion less annually than what Gov. Brown projects.

Watch out for these rosy estimates, California taxpayers: The recession wiped out an estimated $9 billion in capital gains tax revenue over the ensuing two years. What did your elected officials do? Covered up that paper hole by increasing income and sales taxes even more in 2009.

Elizabeth MacDonald joined FOX Business Network (FBN) as stocks editor in September 2007 and is the author of Skirting Heresy: The Life and Times of Margery Kempe (Franciscan Media, June 2014).
Follow Elizabeth MacDonald on Twitter @LizMacDonaldFOX.