After months of wildly different projections, Gov. Gavin Newsom and the nonpartisan Legislative Analyst’s Office appear to be on the same page about the size of the state’s budget deficit. Earlier this year, the governor estimated that figure at $38 billion, while the LAO said it could be as high as $73 billion. Now that taxes have been collected and the state revenue picture is clearer, the LAO and Newsom appear to agree on the figure of about $27 billion. LAO has not yet released its exact projected deficit. “We generally think it’s about right,” legislative analyst Gabe Petek told KCRA 3 on Friday. “I think the main difference you might still have in terms of substance is that we have an estimate of the income slightly lower than that of the governor, but it is within a reasonable range of difference We think that the legislators should be aware that there is a risk of decline if they follow the governor’s income estimates. acknowledged that both numbers made the budget process even more complicated than was already anticipated in a year when the state is cash-strapped. “That shouldn’t be a problem now,” he said. HD Palmer, a spokesperson for Newsom’s Department of Finance, said: “There is not much clarity between us and the legislative analyst on the scope of the problem. LAO released its first analysis of the spending plan on Friday. update from the governor, showing the governor’s proposal solves a $55 billion budget problem, as opposed to the $27.6 billion figure Newsom announced last week. Petek noted that the numbers differ primarily because of how the two offices account for education spending. “We believe the governor’s proposal gives the state a better fiscal footing going forward,” Petek said, noting that the spending plan limits the use of state reserves while reducing spending on temporary programs. In its analysis, LAO also supported the governor’s proposal to create a new fund to temporarily hold additional funds. California’s deficit comes after consecutive years of large budget surpluses. “Saving a portion of these rising revenues, rather than spending or obligating them immediately, can provide the state budget with an important cushion to deal with declining revenues,” the LAO noted in its report . Palmer said the proposal would likely be presented as a budget bill. Budget bills can be debated, passed and come into effect immediately during budget negotiations before the new fiscal year in July. Lawmakers have until June 15 to pass a state spending plan. See more coverage of California’s top stories here | Download our app.
After months of wildly different projections, Gov. Gavin Newsom and the nonpartisan Legislative Analyst’s Office appear to be on the same page about the size of the state’s budget deficit.
Earlier this year, the governor estimated that figure at $38 billion, while the LAO said it could be as high as $73 billion.
Now that taxes have been collected and the state’s revenue picture is clearer, the LAO and Newsom appear to agree on the figure of about $27 billion. LAO has not yet released its exact projected deficit.
“We generally think it’s about right,” legislative analyst Gabe Petek told KCRA 3 on Friday. “I think the main difference you might still have in terms of substance is that we have an estimate of the revenue slightly lower than the governor’s, but it is within a reasonable range of difference. We think the legislature should be aware that there is a downside risk if they follow the governor’s revenue estimates.
Lawmakers acknowledged that both numbers made the budget process even more complicated than already anticipated in a year when the state is cash-strapped.
“This should not be a problem now,” said HD Palmer, a spokesperson for Newsom’s Department of Finance. “There’s not a lot of clarity between us and the legislative analyst as to the scope of the problem.”
LAO released its first analysis of the governor’s updated spending plan Friday, showing the governor’s proposal addresses a $55 billion budget problem, as opposed to the $27.6 billion figure Newsom announced last week . Petek noted that the numbers differ primarily because of how the two offices account for education spending.
“We believe the governor’s proposal gives the state a better fiscal footing going forward,” Petek said, noting that the spending plan limits the use of state reserves while reducing spending on temporary programs.
In its analysis, LAO also supported the governor’s proposal to create a new fund to temporarily hold additional funds. California’s deficit comes after consecutive years of large budget surpluses. “Saving a portion of these rising revenues, rather than spending or obligating them immediately, can provide the state budget with an important cushion to deal with declining revenues,” the LAO noted in its report .
Palmer said the proposal would likely be presented as a budget bill. Budget bills can be debated, passed, and come into effect immediately during budget negotiations ahead of the new fiscal year in July.
Lawmakers have until June 15 to pass a state spending plan.
See more coverage of California’s top stories here | Download our app.
News Source : www.kcra.com
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