The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - This  is not a prediction of what will happen —state and federal laws and policies will change in the coming years —but rather serves as a baseline to help the Legislature understand its starting place.
https://lao.ca.gov/Publications/Report/5091

The 2025-26 Budget: California's Fiscal Outlook

Nov 20, 2024 - Similarly, the number of Californians who are unemployed is 25  percent higher than during the strong labor markets of 2019 and 2022. Consumer spending (measured by inflation ‑adjusted retail sales and taxable sales) has continued to decline throughout  2024.
https://lao.ca.gov/Publications/Report/4939

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

Jan 13, 2024 - While not all of these amounts represent lower state spending over the long term, they do result in savings today at a cost in the future. As a result, we count them as spending‑related solutions. We estimate the proposed budget includes about $3 billion in reversions.
https://lao.ca.gov/Publications/Report/4825

Despite Fiscal Forecasting Uncertainties, Multiyear Budget Planning Essential

May 27, 2021 - While events of the past year show that attempting to predict the future is a fool ’s errand, the value of multiyear fiscal estimates is not in their predictive precision. Rather, policymakers need insight on the condition of the state ’s underlying fiscal operations —annual revenues relative to expenditures —outside of any near-term surplus or deficit.
https://lao.ca.gov/Publications/Report/4443

The 2024-25 Budget: Multiyear Budget Outlook

May 23, 2024 - By pulling back substantially on one-time and temporary spending, as well as making some ongoing reductions, the Governor ’s May Revision shrinks the state ’s projected deficits from around $30  billion (our December 2023 estimates) to an average of less than $10  billion (our estimates today).
https://lao.ca.gov/Publications/Report/4907

California's Legislative Analyst's Office and the Value of Independence

Nov 15, 2024 - But since macroeconomic dynamics are multifaceted and context dependent, successfully predicting the scenario that will play out is virtually impossible. Consider as evidence that in just the last several years —during and after the COVID-19 pandemic —consensus macroeconomic forecasts have been wildly off from actual outcomes.
https://lao.ca.gov/Publications/Report/4938

The 2022-23 Budget: Multiyear Budget Outlook

May 24, 2022 - LAO Comments Adopting LAO Revenues Mitigates Budget Impacts of a Recession … Although predicting the next recession is impossible, economic indicators currently suggest a heightened risk of recession within two years.
https://lao.ca.gov/Publications/Report/4602

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

May 17, 2025 - We begin by reviewing the evolution of the budget condition, detailing how the outlook deteriorated from roughly balanced in January to a deficit today. Then, we summarize the proposals the Governor puts forward to address the budget problem.
https://lao.ca.gov/Publications/Report/5044

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