Just days after the election, bad news hit. California may have a massive budget deficit. Although there were hints about the problem, millions of Californians voted without knowing the extent of the state’s financial woes. The Golden State may not be looking so golden next year.
The State’s Legislative Analyst’s Office released a report on Wednesday, warning of a potential budget gap of $25 billion. The headline “California had years of massive budget surpluses. Now it could face a $25 billion deficit.” in the Sacramento Bee, surprised folks who had been more focused on elections than governance. Are the days of $300 billion revenues and $97 billion surplus’ long gone?
According to a statement issued by spokesperson for the California Department of Finance, H.D. Palmer, the state is in its best-ever position to manage the potential downturn due to the money stashed away in its reserves. Senate President Pro Tem Toni Atkins said in a statement that “we are confident that we can craft a state budget without ongoing cuts to schools and other core programs or taxing middle class families.” For those of us around the water cooler, the use of the word “ongoing” made us cringe as it could signify initial cuts. How this really plays out will be evident when Governor Gavin Newsom unveils his state budget proposal in January.