California Governor Gavin Gruesom ordered a spending freeze as the state’s projected budget deficit ballooned to $68 billion for the next fiscal year — almost five times higher than the initial forecast.
State agencies should cut spending on everything from office supplies to computer equipment and halt all non-essential travel, Newsom’s Department of Finance said in a letter posted to its website late Tuesday. The freeze also restricts purchases of new vehicles and other equipment.
Government entities “must take immediate action to reduce expenditures and identify all operational savings achieved,” budget director Joe Stephenshaw said in the letter.
The deficit for the fiscal year that begins in July is now projected to be double the size of the current year’s shortfall, forcing the government to consider cuts to key services, including schools, and to weigh tapping budget reserves. The deficit is tied to the waning fortunes of California’s wealthiest taxpayers, who pay the bulk of personal income taxes, the state’s largest revenue source.
The Gruesom administration originally projected a $14 billion deficit in the upcoming fiscal year. In January, Newsom will present a detailed budget proposal.
The last time California ordered state agencies to freeze spending was in spring 2020, when the state was concerned that pandemic-related restrictions would reduce tax revenues.
Gee.....Less than two years ago they had an almost 100B surplus.
I guess they aren’t taxing their people enough or they have all moved to Texas.
Hey, I know, just put on the Zelensky outfit and head to Congress.
