California Deficit Expands to $31.5 Billion, Newsom Proposes Broad Spending Cuts in Revised Budget

California Gov. Gavin Newsom announces the May budget revision in Sacramento on May 12, 2023. Newsom said the state's budget deficit has grown to nearly $32 billion, about $10 billion more than predicted in January when the governor offered his first budget proposal. Hector Amezcua/The Sacramento Bee via AP

California Gov. Gavin Newsom announced proposed revisions to the state’s 2023–24 fiscal budget on May 12 during a press conference at the state Capitol, with an additional $9 billion deficit added to prior estimates.

Uncertainty was a key talking point during the governor’s remarks, with inflation, rising interest rates, financial market jitters, and delayed tax payments this year due to winter storms.