CA Fiscal Watchdog Says Gov. Newsom’s Revised Budget Leaves State ‘Ill-Prepared for a Slip-Up’
The analyst office said the plan leans on $20 billion in reserves and one-time money while planned spending still outpaces revenue.
- On Thursday, Governor Gavin Newsom released a budget proposal aiming to balance state finances, though the Legislative Analyst's Office warns California still faces a $16.9 billion deficit.
- Despite revenues exceeding predictions by $30 billion, the state continues to face significant structural shortfalls, according to Rachel Ehlers, deputy legislative analyst for the Legislative Analyst's Office.
- To bridge the gap, the administration plans to use $20 billion through reserve withdrawals and suspended funding requirements, a strategy Stephen Benson of the California Department of Finance described as taking important steps.
- The proposal includes tax relief, such as halving LLC fees, but Republican Senator and business owner Roger Yolo criticized the measure, arguing it fails to provide meaningful assistance to businesses before they become profitable.
- While the governor claims the budget remains structurally balanced for the next 18 months, Ehlers noted that projected expenditures still exceed revenues, necessitating continued reliance on reserves for future fiscal years.
18 Articles
18 Articles
Gavin Newsom’s last budget still leaves California’s finances wobbly
Gov. Gavin Newsom arrives for his State of the State address Thursday, Jan. 8, 2026, in Sacramento. (File photo by Godofredo A. Vásquez/Associated Press) This commentary was originally published by CalMatters. Sign up for their newsletters. Last week Gov. Gavin Newsom proposed a revised version of his eighth and final state budget, which he said would not only be balanced for the 2026-27 fiscal year but also for his successor’s first year. “I’m…
Dan Walters: Gavin Newsom’s Last Budget Still Would Leave California’s Finances Wobbly
[Noozhawk’s note: We republish news articles and commentaries from CalMatters on state and local policy issues that affect Santa Barbara County readers.] Last week Gov. Gavin Newsom proposed a revised version of his eighth and final state budget, which he said would not only be balanced for the 2026-2027 fiscal year but also for his successor’s first year. “I’m not trying to get out of Dodge,” Newsom said. “This is a balanced budget structurally…
thepress.net
California lawmakers, officials discuss state's $16.9B deficit
(The Center Square) – Officials from the Legislative Analyst’s Office told lawmakers on Tuesday that despite California Gov. Gavin Newsom’s latest budget proposal, lawmakers need to consider the “gray cloud in the silver lining” as they work on the final…
The Myth of Two Balanced Budgets, California and New York City
Both California Governor Gavin Newsom and New York City Mayor Zohran Mamdani claim to have balanced their respective budgets, but in both cases, they are running huge deficits while creating the illusion of balance through creative accounting and bailouts. Liberal commentators are hailing Gavin Newsom and Zohran Mamdani as proof that socialist governance works, that a government can expand free programs, tax the wealthy, and still balance the bo…
CA fiscal watchdog says Gov. Newsom’s revised budget leaves state ‘ill-prepared for a slip-up’
California Gov. Gavin Newsom’s latest budget plan leaves the state “overextended” and vulnerable in the event of a stock market decline, according to the Legislative Analyst’s Office.
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