Rethinking California's Reserve Policy

Apr 10, 2025 - Although the state had surpluses that totaled over $100 billion across 2021‑22 and 2022‑23, Proposition 2 required only a about $10 billion to be saved over a similar period. Further, since 2023‑24, the Legislature has addressed $82 billion in budget problems (with more in deficits likely to emerge in the coming years), but at its largest, the BSA balance reached only $23 billion.
https://lao.ca.gov/Publications/Report/5028

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

May 17, 2025 - For context, the comparable revisions in the prior two budget cycles were $2  billion (2023 ‑24) and $2.7  billion (2022 ‑23). The increase is primarily driven by higher costs in the Medi ‑Cal program, which are projected to exceed January estimates by $10  billion over the three ‑year budget window: roughly $2  billion in 2024 ‑25 and $8  billion in 2025 ‑26.
https://lao.ca.gov/Publications/Report/5044

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

Jan 13, 2025 - The Governor ’s budget does not propose any significant policy changes to the already ‑adopted budget solutions, but some of the assumed savings are now lower —totaling $23  billion for 2025 ‑26. Two key areas where these savings have eroded are in the managed care organization (MCO) tax package and reductions to state operations.
https://lao.ca.gov/Publications/Report/4951