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 2024-25 Budget: Overview of the Governor's Budget

Jan 13, 2024 - We take this approach in order to provide the Legislature visibility into the full scope of the administration ’s choices. What Is Our Estimate of the Budget Problem Under the Governor ’s Budget?  We estimate the administration solved a budget problem of $58  billion.
https://lao.ca.gov/Publications/Report/4825

The 2024-25 Budget: Deficit Update

Feb 20, 2024 - Figure 1 Summary of Possible Remaining One ‑Time and Temporary Spending (In Millions)
https://lao.ca.gov/Publications/Report/4850

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

The 2023-24 Budget: Overview of the Spending Plan (Final Version)

Oct 16, 2023 - The 2023-24 Budget: Overview of the Spending Plan (Final Version) Overview of the Spending Plan (Final Version) Appendix 4: Large One-Time and Temporary Augmentations Transportation Appendix 4, Figure 1 Remaining Large One ‑Time and Temporary Augmentations From the 2021 ‑22 and 2022 ‑23 Budget Packages: Business and Labor General Fund (In millions) Begin new information
https://lao.ca.gov/Publications/Report/4788/4

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: How to Use One-Time Revenue Improvements

Feb 20, 2026 - Figure 1 The State ’s New Wall of Debt (In Billions)
https://lao.ca.gov/Publications/Report/5133

The 2024-25 Budget: Initial Comments on the Governor’s May Revision

May 17, 2024 - In January, we estimated that the budget problem under the administration ’s assumptions was $58  billion. The budget problem is now slightly lower —$55  billion. There are four notable factors contributing to this difference.
https://lao.ca.gov/Publications/Report/4902

The 2023-24 Budget: Multiyear Assessment

Feb 15, 2023 - While both our and the administration ’s forecasts suggest the state faces operating deficits, revenues could differ substantially from these estimates. Figure  1 displays the distribution of most likely revenue outcomes over the multiyear (in grey).
https://lao.ca.gov/Publications/Report/4687