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February 21, 2007 - We estimate that the Governor’s budget plan would result in 2007-08 expenditures exceeding revenues by $2.6 billion. This would leave the state with a $726 million year-end deficit, compared to the Governor’s January 10th estimate of a $2.1 billion positive reserve. In addition, the state would face operating deficits of $3.4 billion in 2008-09, $2.5 billion in 2009-10, and $1.4 billion in 2010-11. Thus, additional solutions will be needed to bring the budget into balance, such as budgetary savings, enhanced resources, or reduced supplemental payments toward paying off budgetary debt. It will also be important to avoid raising ongoing budget commitments without identifying alternative reductions or new revenues to pay for them.
February 22, 2006 - California has benefited greatly from over $11 billion in unanticipated increases in state revenues. Yet, due to its allocation of these funds, the 2006-07 Governor’s Budget would still leave the state with large structural budget shortfalls and an enormous amount of outstanding financial obligations. In this regard, the budget proposal misses an important opportunity to take advantage of highly favorable revenues to get the state’s fiscal house in order. We thus recommend that the Legislature reduce the amount of ongoing spending increases proposed in this budget, and use the savings to either increase reserves or pre-pay additional budgetary debt.
February 22, 2005 - The Legislature has an important budget opportunity. We project that revenues are $2.2 billion higher (for the current and budget years combined) than reflected in the Governor's budget. This, combined with the magnitude of ongoing solutions proposed in the budget plan, would result in a balanced 2005-06 budget with a solid reserve. However, the price of inaction is significant. Without the adoption of ongoing solutions of the magnitude offered by the budget plan, the 2005-06 budget would be precariously balanced and the state would experience major budget shortfalls in 2006-07 and beyond. These shortfalls would be close to $10 billion.
February 20, 2002 - Perspectives on the state's fiscal condition and the budget proposed by the Governor for 2002-03. We find that the state will need to identify and additional $5 billion in budget solutions beyond those proposed by the administration.