California is grappling with a significant budget crisis due to a substantial revenue decline, resulting in a record $68 billion budget deficit.
The state is experiencing an exodus of people and businesses to Republican-run states, further exacerbating the financial strain.
The non-partisan Legislative Analyst’s Office (LAO) report highlights the exponential growth of the deficit, emphasizing the need to tap into cash reserves and reduce spending on schools and community colleges. (Trending: Democrat Accused Of Blocking Release of Jeffrey Epstein Flight Logs)
The report also suggests the state must consider increasing revenue, cutting spending, or a combination of both for a long-term solution.
Additionally, the state experienced its first-ever population decline in 2020 due to COVID-19 lockdowns.
Governor Gavin Newsom’s office emphasizes the need for fiscal responsibility and plans to introduce a balanced budget proposal to address the challenges and protect vital services.
“Federal delays in tax collection forced California to pass a budget based on projections instead of actual tax receipts. Now that we have a clearer picture of the state’s finances, we must now solve what would have been last year’s problem in this year’s budget,” Newsom’s communications director Erin Mellon said.
“In January, the Governor will introduce a balanced budget proposal that addresses our challenges, protects vital services and public safety, and brings increased focus on how the state’s investments are being implemented, while ensuring accountability and judicious use of taxpayer money,” she added.
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