California’s Strong Revenue Trends Mask Looming Budget Risk

Jan 23, 2026 - The disagreement is not about whether revenues are currently strong or even whether the market conditions giving rise to them are susceptible to a downturn. Rather, the issue is whether a wait-and-see approach suffices or whether this long-standing risk to California ’s finances should be incorporated into the state ’s budget assumptions from the start.
https://lao.ca.gov/Publications/Report/5104

The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - Figure 3 General Fund Condition Under Fiscal Outlook (In Millions)
https://lao.ca.gov/Publications/Report/5091

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

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

The 2026-27 Budget: Overview of the Governor's Budget [Publication Details]

Jan 12, 2026 - On January 9, 2026, Governor Newsom’s administration presented its proposed state budget to the California Legislature. In this report, we provide a high-level summary and our initial analysis of the Governor’s budget based on our preliminary review (as of January 10). Assembly Budget Handout (PDF) Senate Budget and Fiscal Review Handout (PDF)
https://lao.ca.gov/Publications/Detail/5101

The 2026-27 Budget: Overview of the Governor's Budget

Jan 12, 2026 - This  higher revenue assumption substantially improves the budget condition relative to our forecast and is the main driving difference between our estimates of the deficit. Higher Spending Estimates Erode Some of the Budget Improvement.
https://lao.ca.gov/Publications/Report/5101

The 2025-26 Budget: Initial Comments on the Governor's May Revision

May 17, 2025 - Overall, our assessm ent of the state’s budget condition for 2025‑26 is very similar to that of the administration’s assessment—namely, since January, when the budget was roughly balanced, a budget problem has emerged.
https://lao.ca.gov/Publications/Report/5044

The 2025-26 Budget: Initial Comments on the Governor's May Revision

May 17, 2025 - On May 14, 2025, Governor Newsom presented a revised state budget proposal to the Legislature. This annual proposed revised budget is referred to as the May Revision. In this brief, we provide a summary of and comments on the Governor’s revised budget, focusing on Governor’s proposals for and the overall condition of the state General Fund—the budget’s main operating account.
https://lao.ca.gov/Publications/Report/5044/2

The 2025-26 Budget: Initial Comments on the Governor's May Revision

May 17, 2025 - On May 14, 2025, Governor Newsom presented a revised state budget proposal to the Legislature. This annual proposed revised budget is referred to as the May Revision. In this brief, we provide a summary of and comments on the Governor’s revised budget, focusing on Governor’s proposals for and the overall condition of the state General Fund—the budget’s main operating account.
https://lao.ca.gov/Publications/Report/5044/1

The 2025-26 Budget: Initial Comments on the Governor's May Revision [Publication Details]

May 17, 2025 - On May 14, 2025, Governor Newsom presented a revised state budget proposal to the Legislature. This annual proposed revised budget is referred to as the May Revision. In this brief, we provide a summary of and comments on the Governor’s revised budget, focusing on Governor’s proposals for and the overall condition of the state General Fund—the budget’s main operating account.
https://lao.ca.gov/Publications/Detail/5044