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

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 2023-24 California Spending Plan: Other Provisions

Nov 8, 2023 - Chapter 53 of 2023 (SB 124, Committee on Budget and Fiscal Review) Green Bank Financing. Authorizes I ‑Bank to spend future federal funding that the state might receive through the Climate Catalyst Revolving Loan Fund program.
https://lao.ca.gov/Publications/Report/4814

Rethinking California's Reserve Policy

Apr 10, 2025 - That is: the state will face revenue downturns in the future, but we can ’t predict when those will occur or how big they will be. This makes the state ’s reserve policy more like an individual saving for retirement.
https://lao.ca.gov/Publications/Report/5028

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

Sep 30, 2022 - Chapter  53 of 2022 (AB  182, Committee on Budget) created the Learning Recovery Emergency Fund, a special fund to assist schools and community colleges in the long-term recovery from the COVID-19 pandemic.
https://lao.ca.gov/Publications/Report/4631

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

Oct 27, 2021 - In addition, the budget agreement includes $ 515 m illion ongoing General Fund beginning in 2022 ‑ 23 t o revamp the MCS program. The revamped program results in a significant increase in the number of MCS recipients and MCS award  amounts.
https://lao.ca.gov/Publications/Report/4448

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

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

Jan 29, 2021 - Under its own revenue forecast, assuming the suspensions were operative, the administration estimates operating deficits would grow from $7. 6  b illion in 2022 ‑ 23 t o $11. 3  b illion in 2024 ‑25.
https://lao.ca.gov/Publications/Report/4328