California not long ago was reveling in a record budget surplus. Now the Legislature’s fiscal analysts are projecting a $25 billion deficit next fiscal year as tax revenues decline.
The nonpartisan agency on Wednesday put the Capitol on alert by recommending state lawmakers cut spending when they reconvene in January — and even hold back some already-budgeted funding in order to avoid the shortfall.
.... They also recommended paring back spending rather than dipping into reserves to balance the budget — “something we will consider,” said Assembly Budget Chair Phil Ting (D-San Francisco) in an interview Wednesday. “But at the end of the day,” he said, “if we feel we are going into a tougher economic climate, that’s what the reserve is there for.”