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

May 17, 2025 - Finally, although we have not previously recommended the Leg islature take decisive action to address the structural deficits, the state ’s persistent fiscal imbalance and the added downside risks —particularly from potential federal actions —suggest a need for a more proactive approach.
https://lao.ca.gov/Publications/Report/5044

The 2025-26 Budget: Overview of the Governor's Budget

Jan 13, 2025 - The Governor has signaled interest in changing the state ’s reserve policy by: (1)  increasing the cap on BSA required deposits from 10  percent of General Fund taxes to 20  percent of General Fund taxes, and (2)  excluding the state ’s reserve deposits from the state appropriations limit.
https://lao.ca.gov/Publications/Report/4951

Rethinking California's Reserve Policy

Apr 10, 2025 - In light of these developments, the Legislature has signaled an interest in making changes to the state ’s reserve policy. In addition, through this year ’s budget process, the Governor has proposed two changes to the state ’s rainy day fund that, if passed by the Legislature, would go before voters.
https://lao.ca.gov/Publications/Report/5028