"A new state report warns that Gov. Gavin Newsom's plan to close a projected $2.9 billion budget shortfall fails to confront what it calls alarming multibillion-dollar deficits looming in the years ahead. The Governor and administration officials have acknowledged the downside risk to the state's revenue picture and the multi-year challenges facing the budget, the state's nonpartisan Legislative Analyst's Office wrote in the report."
"The report published Monday warns of rising spending commitments in the proposed budget, which counts on a $42 billion windfall from high-income taxpayers' stock market returns to balance the books this year a volatile revenue source that could evaporate in a financial downturn. Critics of Newsom, including San Jose Mayor Matt Mahan now considering a run for governor as Newsom reaches his term limit in 2026 were quick to pounce on the report."
Gov. Gavin Newsom's budget proposal seeks to close a projected $2.9 billion shortfall while not including material actions to address multiyear deficits. The state's nonpartisan Legislative Analyst's Office flagged alarming multibillion-dollar deficits looming in future years and noted downside revenue risks. The proposal counts on a $42 billion windfall from high-income taxpayers' stock market returns to balance the books, a volatile revenue source that could evaporate in a financial downturn. Spending commitments rise in the proposed budget as the total reaches $349 billion, up from about $320 billion. Lawmakers must negotiate changes and finalize the budget by mid-June.
Read at www.mercurynews.com
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