California could face a $25 billion budget deficit in 2023–24, despite raking in a record-setting $98 billion budget surplus this year, according to an analysis that comes days after midterms election, in a state where the Democratic party enjoys a supermajority.
“The budget problem is mainly attributable to lower revenue estimates, which are lower than budget act projections from 2021–22 through 2023–24 by $41 billion. Revenue losses are offset by lower spending in certain areas,” said the nonpartisan Legislative Analyst’s Office (LAO) of California in its annual fiscal outlook (pdf). The estimated numbers look dismal especially when the analysis has not factored in the inflation or an economic recession.
