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California’s cities and schools face big budget gaps, few options

California's state budget is facing a structural deficit, meaning revenues are not keeping pace with mandated spending, a problem fiscal authorities have identified Part: 1.
An erroneously high revenue forecast in 2022 led to increased spending and the expectation of a budget surplus, contributing to the current financial strain Part: 2.
Gavin Newsom and the Legislature have used tactics like borrowing, creative accounting, and rainy day funds to temporarily address the gap between income and outgo Part: 1.
Los Angeles, San Francisco, and many school districts are experiencing financial difficulties due to stagnant revenues, inflation, declining enrollment, and the expiration of federal COVID-19 grants Part: 4, Part: 5.
With San Francisco facing an $876 million deficit and Los Angeles potentially overspending by several hundred million dollars, options for addressing the shortfalls include tax increases or spending reductions, though voters may resist tax hikes Part: 4, Part: 7, Part: 8.

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California’s cities and schools face big budget gaps, few options

California’s state budget is mired in what fiscal authorities call a “structural deficit,” meaning its revenues cannot keep up with spending mandated by current law. For several years, Gov. Gavin Newsom and the Legislature have papered over the chronic gap between income and outgo with gimmicks, including on- and off-budget borrowing and creative accounting, plus dips into “rainy day” funds set aside for emergencies. Those maneuvers merely postp…

2 months ago·Sacramento, United States

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