Gov. Gavin Newsom’s (D-CA) administration is set to climb out of a $2 billion deficit hole with the help of substantial government cuts and higher-than-projected revenue for the state.
The administration, with Newsom absent during the wildfire crisis, laid out the details of the governor’s 2025-2026 budget proposal on Friday.
The new proposal will give the state a $363 million budget surplus. The primary drivers of the newfound surplus were a $9.4 billion tax revenue windfall and an elimination of 6,500 vacant positions, saving $1.2 billion. It will not cut any major programs like Newsom’s free universal “transitional kindergarten.”
California Director of Finance Joe Stephenshaw blamed past inaccurate tax revenue projections on an IRS tax filing delay “which impacted our ability to accurately forecast and understand where revenues were headed.”
Stephenshaw…
