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

Whether or Not to Tap Reserves to Solve Estimated Budget Problem Emerges as Key Fiscal Decision Facing California’s Legislature

Apr 19, 2023 - Revenues increased by nearly 30 percent in 2020-21 and another 20 percent in 2021-22. In the course of allocating the historically large surpluses generated by the revenue surge, General Fund spending increased commensurately.
https://lao.ca.gov/Publications/Report/4762

The 2022-23 Budget: California’s Fiscal Outlook

Nov 17, 2021 - CalSTRS Experienced 27.2 Percent Investment Returns in 2020 ‑21. CalSTRS ’ next actuarial valuation —reflecting 2020 ‑21 investment returns, payroll growth, and other factors impacting CalSTRS ’ unfunded liabilities and required contribution rates —will not be available until the spring of 2022, and CalSTRS will set required contribution rates for 2022 ‑23 at that time.
https://lao.ca.gov/Publications/Report/4472

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 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

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 2022-23 California Spending Plan: The State Appropriations Limit

Sep 30, 2022 - That said, as the figure also shows, the May Revision left $3.4  billion in unaddressed SAL requirements in 2022-23. Final Budget Act. The final budget package does not reflect excess revenues across 2020-21 and 2021-22, nor does it include any unaddressed SAL requirements for 2022-23.
https://lao.ca.gov/Publications/Report/4631

The 2024-25 Budget: California's Fiscal Outlook

Dec 7, 2023 - Proposition   98 Reserve Could Cover Spending Above the Minimum Requirement in 2022 ‑23. Based on deposits the state made in 2020 ‑21 and 2021 ‑22, the Proposition  98 Reserve currently holds a balance of $8.1  billion.
https://lao.ca.gov/Publications/Report/4819

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

Nov 17, 2021 - For the upcoming budget cycle, the Legislature has nearly $20 billion to allocate for new commitments, including $10.2  billion in one ‑time funds related to 2020 ‑21 and 2021 ‑22 and $9.5 billion in ongoing funds related to 2022 ‑23.
https://lao.ca.gov/Publications/Report/4473

The 2021-22 Budget: The Governor’s Suspension Proposal

Jan 29, 2021 - This language was included in both the 2019 ‑20 and 2020 ‑ 21 b udget acts. How the Suspensions Work. Current law empowers the Department of Finance (DOF) to administer the suspension calculation. The formula is shown in Figure  1 .
https://lao.ca.gov/Publications/Report/4328