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

Jan 13, 2024 - In addition, the Governor ’s budget includes $13  billion in reserve withdrawals, which represent nearly one ‑quarter of the total; $4  billion in cost shifts; and about $400  million in revenue ‑related solutions.
https://lao.ca.gov/Publications/Report/4825

The 2024-25 Budget: Overview of the Spending Plan

Sep 6, 2024 - Specifically, the budget cuts $400   million from the Active Transportation Program, $200   million planned for grade separation projects, and $75   million from the Highways ‑to ‑Boulevards Pilot Program.
https://lao.ca.gov/Publications/Report/4922

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

The 2025-26 Budget: Overview of the Spending Plan

Oct 16, 2025 - The spending plan includes two types of these loans: $550  million in loans allocated to specific funds ($150  million from the Unfair Competition Law Fund and $400  million from the Labor and Workforce Development Fund) and $1.5  billion in unallocated special fund loans, authorized through Control Section 13.40.
https://lao.ca.gov/Publications/Report/5079

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 2022-23 California Spending Plan: Other Provisions

Sep 27, 2022 - At this early stage, the administration estimates that this change could reduce state tax revenue by $400  million annually. Suspends Sales Tax on Diesel Fuel. The budget package suspends the General Fund portion of the sales tax on diesel fuel from October 2022 through September 2023.
https://lao.ca.gov/Publications/Report/4626

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 - This includes $2.3  billion —$1.9  billion in 2021 ‑22 and about $400  million in 2022 ‑ 23 —for activities such as actions to improve water conservation, drinking water supplies and projects, grants for repairs to community water systems, and steps to protect fish and wildlife from drought impacts.
https://lao.ca.gov/Publications/Report/4616

The 2022-23 Budget: Overview of the Governor's Budget

Jan 13, 2022 - The Governor proposes $800  million from the General Fund over two years —$400  million in 2022 ‑23 and 2023 ‑ 24 —to implement various efforts to improve forest health and make communities more resilient to future wildfires.
https://lao.ca.gov/Publications/Report/4492