The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - The 2026-27 Budget: California's Fiscal Outlook Executive Summary Not Safe to Bet Artificial Intelligence ( AI) Fueled Exuberance Is Sustainable. Both the California and U.S. economies currently face significant headwinds.
https://lao.ca.gov/Publications/Report/5091

New Inflation Poses Not So New Budget Risk

Dec 15, 2022 - First, what is the main channel through which high inflation affects the state’s budget condition? Second, how exposed is the state’s cost structure to the effects of high inflation? The broader concerns related to inflation also give rise to an important question from the opposite direction: Should the Legislature consider whether its policy choices will influence the level or direction of inflation in the economy?
https://lao.ca.gov/Publications/Report/4653

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

Jan 12, 2026 - That said, recent budgets have set the SFEU bet ween $3.5  billion and $4.5  billion, so the Governor ’s budget proposal to set the balance to $4.5  billion is generally in line with recent policy.
https://lao.ca.gov/Publications/Report/5101

The 2022-23 Budget: California’s Fiscal Outlook

Nov 17, 2021 - Enhanced Federal Match for Home ‑ and Community ‑Based Services (HCBS). The ARP also included a temporary enhanced federal match rate for HCBS funded through the Medicaid program, which reduces the state ’s share of base program costs for these services by $3 billion.
https://lao.ca.gov/Publications/Report/4472

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 2021-22 Budget: Overview of the Governor's Budget

Jan 10, 2021 - Conclusion The pandemic has disrupted the lives and livelihoods of millions of Californians and continues to take the lives of thousands of Californians each month. In the spring of 2020, the Legislature faced an unprecedented challenge to respond to the pandemic and adopt a budget in the face of unprecedented economic uncertainty.
https://lao.ca.gov/Publications/Report/4309

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

May 17, 2025 - As we discuss later in this brief, the May Revision maintains a cost ‑of ‑living adjustment (COLA) and other spending increases for schools and community colleges despite the drop in funding. Baseline Spending Higher by $12   Billion.
https://lao.ca.gov/Publications/Report/5044

The 2023-24 Budget: California's Fiscal Outlook

Nov 16, 2022 - Assume Enhanced Federal Match for Medicaid Ends Midway Through 2022 ‑23. Medicaid is an entitlement program whose costs generally are shared between the federal government and states. In 2020, Congress approved a temporary 6.2  percentage point increase in the federal government ’s share of cost for most state Medicaid programs.
https://lao.ca.gov/Publications/Report/4646

The 2023-24 Budget: Considering Inflation's Effects on State Programs

Nov 16, 2022 - As a result, there are three general mechanisms for these spending adjustments, all of which require different levels of legislative input. Formulaic Adjustments. Cases in which program spending is adjusted by certain factors, like a cost ‑of ‑living adjustment (COLA).
https://lao.ca.gov/Publications/Report/4647

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

Nov 17, 2021 - To address high living costs for students, the state could increase ongoing funding for financial aid (such as by augmenting funding for the Student Success Completion Grant, which supports eligible low ‑income students attending college full time) or provide one ‑time or ongoing funds to support food and housing insecure students.
https://lao.ca.gov/Publications/Report/4473