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Politico: CA Stares Down $25B Deficit After Years Of Record Cash

Source: Politico

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.”