California’s Strong Revenue Trends Mask Looming Budget Risk

Jan 23, 2026 - These challenges would not be short-lived either. 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 2025-26 Budget: California's Fiscal Outlook

Nov 20, 2024 - Instead, much of the bounce appears to be tied to special forms of pay for high ‑income workers, such as bonuses and stock  compensation. Booming Stock Market Driving Income Growth. The recent run ‑up in the stock market, which appears tied to optimism surrounding artificial intelligence, is a primary driver of the rapid growth in pay to high ‑income workers.
https://lao.ca.gov/Publications/Report/4939

The 2022-23 Budget: Fiscal Outlook for Schools and Community Colleges

Nov 17, 2021 - The Legislature and Governor previously agreed to ramp up ongoing funding over the next four years —from $1 billion in 2021 ‑22 to about $5 billion by 2025 ‑26. The state could accelerate this schedule, which would give districts more certainty about their funding levels and potentially improve local planning for these  programs.
https://lao.ca.gov/Publications/Report/4473

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

Jan 12, 2026 - Ongoing, the Governor ’s spending ‑related solutions provide $5  billion in savings within a few years. Appendix 1 provides a list of the Governor ’s budget solutions. Generates $5.6 Billion School and Community College Settle‑Up Obligation in 2025‑26.
https://lao.ca.gov/Publications/Report/5101

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

May 17, 2025 - Revenues Lower by About $5   Billion. The May Revision downgrades the administration ’s revenue estimates by $5  billion. Revenues for prior and current years are up a total of $6  billion, primarily reflecting stronger ‑than ‑expect personal income tax collections which are running $4  billion ahead of prior projections as of April.
https://lao.ca.gov/Publications/Report/5044

The 2025-26 Budget: Overview of the Spending Plan

Oct 16, 2025 - In this publication we: provide an overview of the 2025 ‑26 budget package, give a brief description of how the budget process unfolded, and then highlight the major features of the budget approved by the Legislature and signed by the Governor.
https://lao.ca.gov/Publications/Report/5079

The 2021-22 Budget: Overview of the Spending Plan (Final Version)

Oct 27, 2021 - APS = Adult Protective Services; CFAP = California Food Access Program; Cal ‑OAR = California CalWORKs Outcomes and Accountability Review; COLA = cost ‑of ‑living adjustment; GF = General Fund; ARPA = Advanced Research Projects Administration; LCSAs = local child support agencies; FFPSA = Family First Prevention Services Act; DDS = Department of Developmental Services; MSSP=
https://lao.ca.gov/Publications/Report/4448/1

The 2021-22 Spending Plan: Other Provisions

Sep 23, 2021 - Under this program, CalOSBA will make grants of up to $250,000 to independent venues and related businesses whose operations were disrupted by the pandemic. Eligible businesses include those that organize, promote, produce, or host live concerts, comedy shows, sporting events, and theater productio ns.
https://lao.ca.gov/Publications/Report/4452

New Inflation Poses Not So New Budget Risk

Dec 15, 2022 - Inflation Risk Is Really a Revenue Risk Although high inflation often is most associated with rising prices and a higher cost of living, from a state budget perspective, the overriding worry is on the revenue side.
https://lao.ca.gov/Publications/Report/4653

Rethinking California's Reserve Policy

Apr 10, 2025 - This change need not occur immediately as it will take time for the state to build up reserves through future economic cycles. As such, we suggest the Legislature ask the voters to authorize a scheduled, phased‑in increase: 20 percent to take effect immediately after the next statewide election, 25 percent in 2030, and increasing by 5 percent every five years until the cap reaches a maximum of 50 percent in 2055.
https://lao.ca.gov/Publications/Report/5028