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

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

The 2023-24 Budget: State Appropriations Limit Estimates

Feb 1, 2023 - Our recent estimates suggest there is an 80 percent chance that revenues will be lower than Governor’s budget projections in 2022-23. Lower revenues in 2022-23 also likely would mean lower revenue projections for 2023-24.
https://lao.ca.gov/Publications/Report/4667

The 2025-26 Budget: Undertaking Fiscal Oversight

Feb 24, 2025 - Although the Legislature solved sizeable deficits over the past few years, totaling over $80  billion, those solutions largely only impacted one-time and temporary programs supported by the one-time, post-pandemic revenue surge.
https://lao.ca.gov/Publications/Report/4983

The 2022-23 California Spending Plan: Other Provisions

Sep 27, 2022 - If the worker (or a family member) tests positive for COVID-19, the law requires employers to provide up to an additional 40 hours (for a total of 80 hours) of sick leave if needed. Increased Weekly PFL and DI Benefits.
https://lao.ca.gov/Publications/Report/4626

The State Appropriations Limit

Apr 21, 2021 - The state ’s appropriations subject to the limit fell substantially during the dot ‑com bust in the early 2000s and again during the Great Recession due to the significant decline in state revenues during those downturns.
https://lao.ca.gov/Publications/Report/4416

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 2022-23 Budget: Overview of the Spending Plan

Oct 12, 2022 - First, it includes a total of $900 million from the General Fund on a one ‑time basis over three years —$80 million in 2021 ‑22, $320 million in 2022 ‑23, and $500 million in 2023 ‑ 24 —for various departments to implement a package of proposals focused on wildfire prevention and improving landscape health.
https://lao.ca.gov/Publications/Report/4616

The 2023-24 California Spending Plan: Other Provisions

Nov 8, 2023 - Relative to 2022-23, this reflects a decrease of roughly $80  million General Fund and an increase of 34 positions. Most of the decrease in General Fund relative to the prior year is a result of one-time funding provided in 2022-23.
https://lao.ca.gov/Publications/Report/4814

Rethinking California's Reserve Policy

Apr 10, 2025 - In March of 2004, on the heels of the dot ‑com bust, voters passed Proposition  58, which created the Budget Stabilization Account (BSA). In the 2006 ‑07 budget, the Legislature deposited $472  million into the BSA and in 2007 ‑08 deposited $1.5  billion.
https://lao.ca.gov/Publications/Report/5028