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

Jan 12, 2026 - Under two voter initiatives, the State Constitution requires the state to set aside a share of revenues for schools and community colleges (Proposition  98, 1988) and debt payments and reserve deposits (Proposition  2, 2014).
https://lao.ca.gov/Publications/Report/5101

The 2024-25 Budget: Proposition 2 Debt Payment Proposals

Mar 20, 2024 - Proposition 2 Proposition   2 Contains Annual Debt Payment Requirement. Proposition  2 created new rules regarding: (1)  deposits into the state ’s rainy ‑day fund and (2)  accelerating payments toward certain eligible debts.
https://lao.ca.gov/Publications/Report/4887

The 2026-27 Budget: California's Fiscal Outlook

Nov 19, 2025 - This is because constitutional spending requirements under Proposition  98 (1988) and Proposition  2 (2014) almost entirely offset revenue gains. Moreover, we estimate costs in other programs to be about $6  billion higher than anticipated.
https://lao.ca.gov/Publications/Report/5091

The 2025-26 Budget: Overview of the Spending Plan

Oct 16, 2025 - Proposition   98 “Settle Up ” ($1.9   Billion). Proposition  98 (1988) sets a minimum funding requirement for schools and community colleges based on formulas in the State Constitution. The state makes an initial estimate of this requirement when it enacts the budget, then revises this estimate over the following two years to reflect updated data.
https://lao.ca.gov/Publications/Report/5079

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

May 17, 2025 - Rebenching Proposition   98 for Wildfire ‑Related Property Tax Losses. The May Revision proposes rebenching the Proposition  98 minimum funding guarantee to account for property tax revenue losses resulting from the January 2025 Los Angeles wildfires.
https://lao.ca.gov/Publications/Report/5044

Rethinking California's Reserve Policy

Apr 10, 2025 - (Proposition  2 also created the Proposition  98 Reserve, which was discussed in the box previously.) After Proposition  2 was passed, the state saved significantly more in reserves, particularly when compared to the savings levels from the early 1980s through the early 2010s.
https://lao.ca.gov/Publications/Report/5028

The 2021-22 Budget: The Governor’s Proposition 2 Proposals

Apr 26, 2021 - The 2021-22 Budget: The Governor’s Proposition 2 Proposals The Governor ’s Proposition  2 Proposals Introduction Passed by voters in 2014, Proposition  2 changed budgeting practices concerning: (1)  reserves and (2)  debt payments.
https://lao.ca.gov/Publications/Report/4418

Reserves, Proposition 2, and the Budget Stabilization Account (Panel 1) [Publication Details]

May 7, 2025 - Reserves, Proposition 2, and the Budget Stabilization Account (Panel 1) [Publication Details] Translate Our Website This Google ™ translation feature provided on the Legislative Analyst's Office (LAO) website is for informational purposes only.
https://lao.ca.gov/Publications/Detail/5040

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

Nov 17, 2021 - Make Optional Proposition 98 Reserve Deposit. An additional one ‑time deposit into the Proposition 98 Reserve would increase the protection for ongoing programs in the event of an economic downturn, reducing the likelihood of cuts or deferrals.
https://lao.ca.gov/Publications/Report/4473

The 2025-26 Budget: Multiyear Budget Outlook

May 24, 2025 - Offsetting this, our projections for school and community college spending are higher, reflecting Proposition  98 (1988) formulas that typically increase (or decrease) with changes in revenue. Additionally, our estimates for spending in other areas —primarily health and human services programs —are somewhat higher than the administration ’s projections.
https://lao.ca.gov/Publications/Report/5052