California’s Strong Revenue Trends Mask Looming Budget Risk

Jan 23, 2026 - After the dot-com bust and the Great Recession, it took four and five years, respectively, for revenues to recover. Incorporating revenue risk into the budget now, therefore, reflects prudence, not pessimism.
https://lao.ca.gov/Publications/Report/5104

Building Reserves to Prepare for a Recession

Mar 7, 2018 - By most measures, the recession of the early 1990s was more severe than the dot ‑com bust in the early 2000s. For example, unemployment in California reached 9. 7  p ercent in mid ‑ to late ‑1992, but peaked at 6. 9  p ercent after the dot ‑com bust.
https://lao.ca.gov/Publications/Report/3769

The 2018-19 May Revision: LAO Economic Outlook

May 12, 2018 - The typical PE ratio since 1990 is 21 (19 if the dot-com bubble of the late 1990s and early 2000s is excluded). Similar to the price-to-earnings ratio, the home price-to-rent ratio is used to gauge if home prices are in line with underlying demand for housing.
https://lao.ca.gov/Publications/Report/3829

The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - For California, the dot ‑com era —when stocks rose and then fell precipitously in response to widespread adoption of the internet —offers the most salient example. The internet has proven to be a transformative technology and, yet, the stock market ’s initial reaction was clearly overly exuberant.
https://lao.ca.gov/Publications/Report/5091

Whether or Not to Tap Reserves to Solve Estimated Budget Problem Emerges as Key Fiscal Decision Facing California’s Legislature

Apr 19, 2023 - Other downturns, such as the 2001 so-called dot-com recession, had severe fiscal implications while inflicting somewhat milder economic damage. The 2008 Great Recession had brutal effects on both the state ’s economy and budget.
https://lao.ca.gov/Publications/Report/4762

Managing California’s Cash

Sep 3, 2019 - Figure  8 shows the state ’s cash cushion in December of each fiscal year from 1996 ‑ 97 t o 2018 ‑19 (a month when the state often reaches its annual cash balance lows). The figure displays month ‑end cash, so the state reached even lower levels in some of these years within the month.
https://lao.ca.gov/Publications/Report/4092

The 2018-19 Budget: Overview of the Governor's Budget

Jan 12, 2018 - The Governor ’s budget also includes $1. 8  b illion for K ‑12 discretionary grants. Similar to previous years, funds would be allocated on a per ‑student basis and the grants would offset any existing mandate claims.
https://lao.ca.gov/Publications/Report/3731

The 2019-20 Budget: California Spending Plan—Debt Liabilities

Oct 17, 2019 - (The payment made in 2018 ‑19 is part of the 2019 ‑20 budget package, but was attributed to 2018 ‑19 for budgetary purposes.) Chapter  33 specifies that these supplemental payments be apportioned based on a pension plan ’s share of the state ’s General Fund contribution to CalPERS.
https://lao.ca.gov/Publications/Report/4106

The 2019-20 Budget: California's Fiscal Outlook

Nov 14, 2018 - Under our growth scenario, General Fund revenues and transfers grow from $137. 5  b illion in 2018 ‑ 19 t o $159. 3  b illion in 2022 ‑23. This represents a moderate 3. 8  p ercent average annual growth rate over the period.
https://lao.ca.gov/Publications/Report/3896

The 2018-19 Budget: Repaying the CalPERS Borrowing Plan

Apr 4, 2018 - Altogether, we estimate the relieved loan repayment costs to total about $8. 5  m illion. As described below, these costs are shifted to other funds in 2018 ‑19 so that overall repayments from all other state funds remain at the planned level of $ 200  m illion.
https://lao.ca.gov/Publications/Report/3797