$20.7 Billion Deficit Projected for 2010-2011 Budget

The Legislative Analyst's Office (LAO) has released its report on the 2010-2011 state budget outlook, warning of continued state budget deficits:

Our forecast of California's General Fund revenues and expenditures shows that the state must address a General Fund budget problem of $20.7 billion between now and the time the Legislature enacts a 2010–11 state budget plan. The budget problem consists of a $6.3 billion projected deficit for 2009–10 and a $14.4 billion gap between projected revenues and spending in 2010–11. Addressing this large shortfall will require painful choices—on top of the difficult choices the Legislature made earlier this year.

The report states:

[T]he scale of the deficits is so vast that we know of no way that the Legislature, the Governor, and voters can avoid making additional, very difficult choices about state priorities. … In the coming years, major state spending programs will have to be significantly reduced. Policymakers will also need to add revenues to the mix.

The report includes forecasts for budget years through 2014-2015. The assumptions the LAO relied upon for its projections include no pay increases for state workers, increased spending on certain programs such as CalWorks and in-home support services, no increased funding for higher education, and a $2 billion increase in prison spending.

Links

• The 2010-11 Budget: California's Fiscal Outlook (Legislative Analyst's Office)
  • Video summary of LAO's Higher Education forecast
  • Summary of 2010-2011 Budget Outlook
  • California's Fiscal Outlook: The 2010-11 Budget [PDF]
• State budget drowning in red ink for next year (San Francisco Chronicle)
• California faces a projected deficit of $21 billion (Los Angeles Times)
• The Master Plan at 50: Assessing California's Vision for Higher Education (Legislative Analyst's Office)
  • Summary of The Master Plan at 50: Assessing California's Vision for Higher Education