"California's 2024-25 Budget Deficit Soars, Exceeding Newsom's Projections"

The LAO projects a $24 billion shortfall in revenue for 2022-2025, increasing the estimated deficit to $73 billion. The Legislature will need to find $15 billion in new budget solutions, including revenue increases, spending reductions, reserves, and cost shifts. The LAO recommends reviewing recent one-time and temporary spending for potential reductions, as this could provide a cushion for future budget problems and preserve other tools for addressing ongoing services. They estimate that the state could possibly pull back or reduce as much as $6.4 billion in 2023-24, $4.1 billion in 2024-25, and $5.1 billion in 2025-26 from one-time and temporary spending.