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

Nov 17, 2021 - K ‑12 Attendance Projected to Drop in 2021 ‑22, Rise Over the Following Four Years. The state did not collect school attendance data in 2020 ‑21 due to the pandemic and the temporary switch to remote learning.
https://lao.ca.gov/Publications/Report/4473

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

Oct 27, 2021 - Under the June 2021 b udget plan, the total required deposit is $4. 5 b illion —$1. 9 b illion in 2020 ‑21 and $2. 6 b illion in 2021 ‑22. The largest discretionary allocation of Proposition 98 funding is $12. 5 b illion to pay down the deferrals the state adopted as part of the June 2020 b udget plan.
https://lao.ca.gov/Publications/Report/4448

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 Budget: Overview of Proposition 98 Proposals [Publication Details]

Jan 27, 2022 - This analysis describes the overall structure of the Governor's plan for school and community college funding, including the major spending proposals and underlying estimates of the Proposition 98 minimum guarantee.
https://lao.ca.gov/Publications/Detail/4502

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

Sep 30, 2022 - 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. In particular, as of July 2022, the administration estimates 2020-21 ended with appropriations subject to the limit above the limit by $16  billion.
https://lao.ca.gov/Publications/Report/4631

The 2021-22 Budget: Initial Comments on the Governor’s May Revision

May 17, 2021 - Put another way, $12  billion  of spending in the May Revision is attributable to reserve withdrawals and borrowing from 2020 (see Figure  7). Figure 7 Governor Still Uses Budget Solutions Despite Historic Revenue Growth Budget Solutions From 2020 Maintained in 2021 May Revision (In Billions) Reserve Withdrawals Make Budget Stabilization Account withdrawal $7.8 Make Safety Net Reserve withdrawal 0.5
https://lao.ca.gov/Publications/Report/4432

The 2022-23 Budget: California’s Fiscal Outlook

Nov 17, 2021 - There are many reasons for this, including: the timing and amount of federal funds displacing non‑Proposition 98 General Fund spending and low growth in K‑12 average daily attendance.
https://lao.ca.gov/Publications/Report/4472