(TheIndependentStar.com) – In a painful testimony to the harm leftist financial policies are inflicting upon the United States, the Democrat-run state of California now faces a staggering budget deficit of $73 billion, which is much higher than the latest projection by Governor Gavin Newsom’s administration.
California’s financial shortfall will see an increase of $15 billion above earlier predictions made in January, as reported by the state Legislative Analyst’s Office.
This revision marks a significant jump from the previously anticipated deficit of $58 billion for the fiscal year 2024-25, based on revenue projections from Newsom’s initial budget plan, as detailed by CalMatters, cited by Newsmax.
The adjustment comes after the state Department of Finance reported that preliminary general fund revenues for January fell $5 billion short of the governor’s expectations.
In response to this escalating financial challenge, state Assembly Speaker Robert Rivas told journalists it was vital to address the budget deficit on the Democratic agenda.
He admitted it was inevitable to tap into state reserves, a measure already suggested in Newsom’s January budget proposition.
Despite this, Rivas advocated for a cautious approach toward utilizing the reserves, especially if the fiscal situation deteriorates further.
“We are very concerned about short-term fixes for long-term problems,” he stated.
Rivas assumed the role of speaker the previous summer shortly after an agreement was reached on the 2023-24 budget to manage a $30 billion deficit following years of significant surpluses.
He outlined his strategy to direct the oversight budget subcommittee he established in December to scrutinize state expenditures on housing.
On the topic of Governor Newsom’s dismissal of proposals to increase or introduce new taxes to enhance state revenue, Rivas remained noncommittal.
“We look at all of the strategies when it comes to ensuring that we have a balanced budget — there are many of those tools that are available,” he remarked.
Amid these developments, the state Department of Finance urged the legislature on Tuesday to implement plans for achieving $8 billion in savings to mitigate the deficit.
The governor is slated to present a revised budget proposal in May, followed by the final budget plan in June.
The state’s Republican caucus criticized the Democrats’ handling of the budget situation on Tuesday.
“It’s time for a course correction and a renewed commitment to responsible budgeting that puts the needs of our residents first,” said State Senator Roger Niello, vice-chairperson of the Senate budget committee.
