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 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 - Accordingly, we have adopted terminology that more transparently reflects the underlying natur e of these budget solutions, if not always their precise  mechanics.) Major categories of borrowing in the budget  include: Medi ‑Cal Maneuver ($4.4   Billion).
https://lao.ca.gov/Publications/Report/5079

The 2023-24 Budget: Multiyear Assessment

Feb 15, 2023 - Three of those —the recession in the early 1990s, the dot ‑com bust in the early 2000s, and the Great Recession —resulted in large revenue shortfalls and ensuing multiyear deficits, even for some years after each recession ended.
https://lao.ca.gov/Publications/Report/4687

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

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: Considering Inflation's Effects on State Programs

Nov 16, 2022 - Consequently, adjustm ents for increases in lease costs and OE &E are driven by legislative decisions. Lump Sums to Other Entities. In some other areas of the budget, the state provides lump sum amounts —sometimes referred to as block grants —to other entities of government, which those entities manage as part of their own budgets.
https://lao.ca.gov/Publications/Report/4647

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

Oct 16, 2023 - It requires each plan to coordinate homelessness funding and services across the region, assign specific roles and responsibilities to each party to the plan, and set forth key actions that each party will tak e to reduce and prevent homelessness.
https://lao.ca.gov/Publications/Report/4788

The 2022-23 California Spending Plan: The State Appropriations Limit

Sep 30, 2022 - Some costs for th e ongoing development and operation of larger IT systems (once completed as IT projects) also were excluded from SAL. (For example, some of the development and operations costs for the California Health Eligibility, Enrollment, and Retention System are considered SAL excludable.)
https://lao.ca.gov/Publications/Report/4631