The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - As shown in Figure  1 , many signs of an overly exuberant stock market are present today: measures of whether stocks are “expensive ” are at historically high levels, investors are borrowing more to buy stocks, and households are more invested in the stock market than they have been in at least 70  years.
https://lao.ca.gov/Publications/Report/5091

Fiscal Outlook Addendum: CalPERS

Nov 18, 2015 - Fiscal Outlook Addendum: CalPERS Fiscal Outlook Addendum: CalPERS On November 18, after the Fiscal Outlook was finalized, the CalPERS board approved a proposal to gradually lower the system's 7.5 percent long-term annual earnings assumption ("discount rate") and investment risk profile.
https://lao.ca.gov/Publications/Report/3308

The 2019-20 May Revision: Opportunity Zones

May 11, 2019 - In addition, investors that maintain their investment for at least ten years will not be taxed on any capital gains earned on their Opportunity Zone investment. Various Government Programs Help Californians Afford Housing.
https://lao.ca.gov/Publications/Report/4038

The 2025-26 Budget: California's Fiscal Outlook

Nov 20, 2024 - One path is falling interest rates and expansion of money available for lending and investment. A key driver of California ’s economic slump over the last two years has been the Federal Reserve ’s efforts to tamp down inflation by raising interest rates and shrinking how much money is available for lending and investment.
https://lao.ca.gov/Publications/Report/4939

The 2024-25 Budget: Proposition 2 Debt Payment Proposals

Mar 20, 2024 - Revenues from investment returns vary significantly year to year depending on market performance; however, CalPERS assumes an annual return of 6.8  percent. Employee and Employer Contributions to “Normal Cost. ” The normal cost is the amount actuaries determine must be contributed to the system in a given year to fund the benefit earned by state employees in that year.
https://lao.ca.gov/Publications/Report/4887

The 2019-20 Budget: Structuring the Budget: Reserves, Debt and Liabilities

Feb 5, 2019 - Specifically, if the state transfers these funds to a pension system, the system ’s board can invest the funds, likely earning a higher rate of return than the funds would earn invested as state reserves.
https://lao.ca.gov/Publications/Report/3925

New Inflation Poses Not So New Budget Risk

Dec 15, 2022 - A decelerating economy —with or without a recession —combined with reduced capital gains from real estate or financial investments diminishes the state ’s revenue outlook. Already, we estimate that in the current budget window —spanning 2021-22 through 2023- 24 —tax revenues will be $41  billion lower than what the 2022-23 Budget Act assumes.
https://lao.ca.gov/Publications/Report/4653

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

Jan 12, 2026 - That said, recent budgets have set the SFEU bet ween $3.5  billion and $4.5  billion, so the Governor ’s budget proposal to set the balance to $4.5  billion is generally in line with recent policy.
https://lao.ca.gov/Publications/Report/5101

California’s Strong Revenue Trends Mask Looming Budget Risk

Jan 23, 2026 - These firms have invested heavily in building out data centers and on extraordinary pay packages for their key employees. This spending, along with gains to investors, has turbo-charged state income tax receipts.
https://lao.ca.gov/Publications/Report/5104

An Extraordinary Moment in California's Fiscal History

Apr 11, 2019 - In our 2018 November fiscal outlook, we estimated that in order to cover the budget problem associated with a moderate recession without cutting programs or raising taxes, the state would require budget reserves of $25 billion.
https://lao.ca.gov/Publications/Report/4003