{"id":9041,"date":"2023-01-12T11:28:46","date_gmt":"2023-01-12T18:28:46","guid":{"rendered":"https:\/\/sandiegonewsdesk.com\/?p=9041"},"modified":"2023-01-12T11:33:45","modified_gmt":"2023-01-12T18:33:45","slug":"californias-budget-black-hole-where-did-the-97-5-billion-surplus-go","status":"publish","type":"post","link":"https:\/\/sandiegonewsdesk.com\/?p=9041","title":{"rendered":"California\u2019s Budget Black Hole: Where Did the $97.5 Billion Surplus Go?"},"content":{"rendered":"

The original story can also be read here<\/a>.<\/p>\n

By\u00a0Katy Grimes<\/span><\/span><\/h4>\n
A review of California Governor Gavin Newsom\u2019s State Budgets 2019-2023<\/h5>\n
\n

In June of 2022, the California legislature passed Gov. Gavin Newsom\u2019s $300 billion budget \u2013 the largest in state history.<\/p>\n

In June 2021, the California Legislature\u00a0passed<\/a>\u00a0Gov. Newsom\u2019s\u00a0$262.6 billion 2021-2022 budget.<\/p>\n

In June 2020, the California Legislature\u00a0passed<\/a>\u00a0Gov. Newsom\u2019s $202.1 billion state budget, confirming state spending for the 2020-2021 fiscal year.<\/p>\n

In May 2019, Gov. Gavin Newsom released his\u00a0revised budget<\/a>, highlighting the largest tax revenue windfall in California history. Gov. Newsom\u2019s\u00a0first budget approved in June of 2019<\/a>\u00a0contained a record number of local pork-barrel projects injected by individual legislators into California\u2019s largest state budget ever (at the time) of\u00a0$215 billion<\/a>. California Globe\u00a0covered in great detail<\/a>\u00a0this record making budget.<\/p>\n

For context, when Gov. Jerry Brown returned to office eight years earlier in 2011, his first state budget was $98 billion, and increased to $200 billion by 2018 \u2014 a 110 percent increase in eight years, with a population increase of just three million.<\/p>\n

In just his first five months in office, Gov. Newsom increased the state budget $5 billion \u2013 even with a tax revenue windfall.<\/p>\n

One year ago<\/a>\u00a0in November 2021 the Globe reported, \u201cCalifornia will have a $31 billion surplus next year,\u201d according to the 2022-2023 California state budget\u00a0Fiscal Outlook report<\/a>\u00a0compiled by the Legislative Analyst\u2019s Office.<\/p>\n

The tide completely turned in one year.<\/p>\n

By November 2022, the\u00a0Legislative Analyst\u2019s Office reported<\/a>\u00a0California revenue is $41 billion below expectations, likely resulting in a massive $25 billion shortfall in the 2023-2024 state budget. The LAO recommended lawmakers start cutting the budget as they begin the January session.<\/p>\n

The perfect storm for a recession may be upon us with high inflation, high taxes, high energy costs, high food costs, a sizable budget deficit, and now tens of thousands of big tech layoffs, which is the other issue California lawmakers and governor need to address, the Globe\u00a0reported<\/a>. Meta, Twitter, Salesforce and Amazon are all cutting thousands of staff. The potential for, or early economic ramifications to the cities and counties in which they reside, as well as the state, and the ripple effect these could have on startups and investment banks, looks to be immense.<\/p>\n

Apropos,\u00a0Gov. Gavin Newsom presented a\u00a0$297 billion 2023-2024 budget plan<\/a>\u00a0on Tuesday, just $3 billion less than last year, but with a projected deficit of $22.5 billion. That\u2019s down from a stunning $97 billion surplus last year. Where did the surplus go?<\/p>\n

The 2023-2024 budget is $82 billion more than\u00a0Newsom\u2019s first budget in 2019, which was $215 billion. And California is is not growing \u2013 the state is bleeding businesses and losing hundreds of thousands of residents to other states.<\/p>\n

In 2019, State Sen. Jim Nielsen noted that\u00a0the state budget was flush $21 billion in surplus revenue. \u201cBut that\u2019s not enough for some in the majority party,\u201d Nielsen said. \u201cThey want more. They want to raise taxes on water, fertilizer, dairy, tires, guns and businesses.\u201d Nielsen asked, \u201cWhy does the state need to raise taxes when there\u2019s $21 billion in surplus? They are spending their way into another crushing deficit that will harm the poor, blind and disabled, and squeeze the middle class once again.\u201d<\/p>\n

Sen. Nielsen was right \u2013 that spending was the pork-barrel projects injected by individual legislators into California\u2019s 2019-20 state budget.<\/p>\n

Responses to Gov. Newsom\u2019s 2023-2024 budget<\/strong><\/p>\n

Remember, last year California Democrats spent a historical\u00a0budget surplus of $97 billion<\/a>. \u201cCalifornia<\/a>\u00a0Governor Gavin Newsom said Friday that his state has a record $97.5 billion operating surplus, as high tax rates on its wealthiest residents mean he has more cash to fund liberal priorities such as education and health care,\u201d Bloomberg reported just last May. \u201cThat figure surpasses the staggering $38 billion that they had at their disposal during the previous budget season,\u00a0then<\/a>\u00a0considered the biggest.\u201d<\/p>\n

How exactly did the governor and State Democrats make a $125 billion swing in revenue in one year from budget surplus to budget deficit?<\/p>\n

\u201cWhere did that f-ing money go?\u201d one local taxpayer asked me Tuesday as we discussed the budget.<\/p>\n

According to Bloomberg,\u00a0Newsom\u2019s spending plans included:<\/p>\n