California had years of massive budget surpluses. Now it could face a $25 billion deficit – By Maggie Angst and Lindsey Holden (Sacramento Bee) / Nov 16, 2022
After back-to-back historic budget surpluses, California analysts on Wednesday projected that Gov. Gavin Newsom and state legislators could be forced to navigate a $25 billion budget deficit next year.
That shortfall, according to a new report from the state’s independent Legislative Analyst’s Office, could be followed by annual budgetary gaps between $17 billion and $8 billion through 2026-27.
The downturn is due to state revenues growing slower than spending — a possible precursor to a recession, the analyst indicated. The revenue estimates, if accurate, would represent the weakest economic performance California has experienced since the Great Recession of 2007 to 2009, the report said.
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