Budget ‘windfall’ in California as economy weathers virus

Business

California’s nonpartisan Legislative Analyst Gabriel Petek display’s a copy of his office’s upcoming budget forecast, Wednesday, Nov. 18, 2020 in Sacramento, Calif. Petek’s forecasting that the state will have a one-time $26 billion windfall in its next budget year, but warned the windfall is solely the result of the state overestimating the $54 billion budget deficit in the current spending plan. (AP Photo/Rich Pedroncelli)

SACRAMENTO, Calif. (AP) โ€” The coronavirus has had less economic effect on California than state lawmakers had feared.

The result is an anticipated $26 billion windfall for state lawmakers to spend next year.

A report Wednesday by the nonpartisan Legislative Analyst’s Office says the state’s anticipated $54.3 billion budget deficit will be lower. That gives the state some one-time money to spend next year.

But the report warns that California’s recurring spending commitments are still higher than the state’s projected revenue. That gives the state a small operating deficit of $2.6 billion in 2021-22 that could grow to $17 billion by 2024-25.

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