Posted on 12/08/2023 8:14:58 AM PST by george76
California's budget deficit is expected to soar to $68 billion as income tax revenues fall behind with a slow-growing economy.
The latest calculated figures from the state’s nonpartisan Legislative Analyst’s Office predict California “will face a serious deficit” of $68 billion, a massive increase from the $14 billion predicted in June. The LAO suggested a number of possible cuts state lawmakers could look into to lower the estimates.
“While addressing a deficit of this scope will be challenging, the Legislature has a number of options available to do so,” according to the LAO website.
The state could look into $24 billion in reserves and possibly reduce funding for schools and community colleges, saving $17 billion, according to the LAO. Reducing “one‑time spending” could also give the state “at least an additional $10 billion.”
However, the LAO predicted the state’s reserves likely are not sufficient to cover the state’s deficits over the years, which will average $30 billion per year under the office’s estimate.
“These deficits likely necessitate ongoing spending reductions, revenue increases, or both," according to the LAO. "As a result, preserving a substantial portion—potentially up to half—of reserves would provide a helpful cushion in light of the anticipated shortfalls that lie ahead."
Under Proposition 98, which requires a minimum funding guarantee for public education, an automatic reduction is about $4 billion, but the state could reduce the general fund by $21 billion if lawmakers approved.
“These options and some others, like cost shifts, would allow the Legislature to solve most of the deficit largely without impacting the state’s core ongoing service level,” according to the LAO.
In June, Gov. Gavin Newsom (D-CA) signed the $310 billion 2023-24 state budget, covering a $30 billion-plus deficit. Newsom is set to release his proposed 2024-25 budget in January, followed by a revision in May. The legislature and the governor will need to take into account the state's multi-billion dollar budget deficit before the former approves the budget for the fiscal year, which begins July 1.
Just as reckless with money as his aunt Nancy
Dear God, give them bankruptcy.
SF City Council:
“Lets hire homeless to clean up the poop...that should save us 3M/year”
“More homeless come to SF for the $ and then they leave even more poop”
“We need more homeless to clean up the poop”
“Socialism works until you run out of other peoples money. “ - Margaret Thatcher..............
From a $90 billion surplus to a $68 billion deficit in two years.
Doesn’t matter. The feds will bail them out. The lunatics in CA can continue on with their wokeness.
Didn’t Calif have a budget surplus just a short time ago????
I think CA has been operating on the “too big to fail” policy for quite a while. Legislating and committing to financial obligations it can’t possibly meet. All with the goal of holding itself hostage to the fed for a ransom bailout. Too big to fail, too big and important for shipping, growing, etc. And leftists in charge of the fed will oblige if they’re in power.
You can’t even trust the meanings of the words they use.
C’mon man—go after Hunter now—at least a million in state income tax to be found there....
I predict gas taxes and vehicle registration will sky rocket.
Too bad they can’t lay off employees.
Every 4000 employees choped would be $1 billion
But, first responder services will take the hit and CHP will be pulling everyone over left and right writing “revenue tickets”
Pretty soon the words for Twelve Thirty (Young Girls Are Coming to the Canyon) will be changed from I used to live in Studio City Everything there was dark and dirty.
“reduce funding for schools and community colleges”
That is ALWAYS the FIRST choice of government scoundrels. If they were serious, they would:
1. Cut all financial support for illegals to ZERO. (that alone would nearly close that budget gap and leave schools alone)
2. Stop construction on the stupid choo-choo
3. Get tough on crime. That would stop the hemorrhaging of businesses and people.
4. End all “green” energy programs and build lots of natural gas fired combined cycle power plants. That would at least stabilize energy prices and provide a predictable energy future so businesses could plan. At best, it would bring energy prices down.
That program would fix the budget mess in less than a year.
Gee, I wonder where the state income tax income went?? Could it be it left with those who were earning it?? Could it be they found somewhere cheaper to live. Could it be they found areas where their way of life was similar to their beliefs.
Pretty soon the words for Twelve Thirty (Young Girls Are Coming to the Canyon) will be changed from I used to live in New York City Everything there was dark and dirty to I used to live in Studio City Everything there was dark and dirty.
I think deficit spending by individual states is paid off by money granted from the Federal Government. That payment happens with a state says it’s unable to pay for the spending.
That money from the Federal Government is borrowed by the Federal Government with no collateral requirement. States can’t do that; therefor the gimmick of getting the money from the Federal Government is employed.
This Federal deficit spending is the cause of inflation, which is effectively a tax increase on ordinary people.
So reckless spending goes without the need to explain how it will be paid for, but we ordinary people do pay for it.
Yeah, as imbecile Newsome wax poetic during his debate with DeSantis about how many homeless his government has helped and gotten of the street.
The only thing that came to my mind while watching him is the chinses proverb about swatting flies around the outhouse, you think you’re getting a lot done but then you look around the problem just keep getting worse.
California budget deficit $68 billion
Florida budget surplus $16 billion
California pols acted like the federal Covid money would be coming forever and budgeted spending levels upward accordingly. The federal money dried up but the spending levels stayed high.
At first I cringe at the thought of reducing funds for education, but those baseline spending levels may still be highly inflated from the free Covid money.
I suspect they could go back to the pre Covid budget plan and be fine. But they won’t.
EC
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